The Democratic Party of Korea has begun work to enact the National Basic Financial Security Act (Basic Finance Act) to introduce financial fundamental rights that would provide low-interest loans to low-income people and partially support indemnity health insurance premiums.
According to the financial and political sectors on the 7th, Democratic Party lawmaker Min Byung-deok will hold a forum on the 10th to enact the Basic Finance Act and begin full-fledged work to introduce the bill. The forum will assess the economic and social effects of realizing financial fundamental rights and discuss legislative and policy tasks.
Kim Sang-bong, a Hansung University professor, will deliver the keynote on the effects of introducing financial fundamental rights. Kim conducted the study by carrying out a commissioned project ordered by the Credit Counseling & Recovery Service (CCRS). The forum will be attended by Chairperson Kim Eun-kyung of the CCRS, who led the enactment of the Basic Finance Act; You Kyung-won, a Sangmyung University professor with the CCRS-launched Financial Fundamental Rights Research Group; Han Jae-joon, an Inha University professor; and others.
The Basic Finance Act presents five core values of financial fundamental rights: the right to access, the right to survival, the right to a fresh start, the right to self-reliance, and the right to asset building. To implement these, four basic finance pillars—basic counseling and debt counseling, basic insurance, basic lending, and basic saving—are planned. The bill also includes a plan to launch a tentatively named Financial Rights and Interests Agency by integrating the Korea INclusive Finance Agency (KINFA) and the CCRS.
Specifically, basic financial products such as basic lending and basic insurance are expected to be introduced. For basic lending, a plan is under discussion to provide long-term loans of up to 10 million won at annual interest rates of 2%–3% to the bottom 30% by income. For basic insurance, the direction under review is to lower medical costs for low-income people through public indemnity insurance in which KINFA and others shoulder part of the premiums.
The forum is also expected to discuss ways to secure funding for introducing basic finance. Earlier, Chairperson Kim Eun-kyung suggested that, to secure funding, it is necessary to expand those obligated to pay KINFA contributions to include the financial investment industry and the virtual asset industry.