Minister Choi Kyo-jin of the Ministry of Education asked the Korea Student Aid Foundation to prepare measures so that young people do not become credit delinquents after graduating from college due to arrears on student loan repayments.
The Minister said on Jan. 8 at the Korea Student Aid Foundation in Daegu, while conducting a briefing on agencies under the Ministry of Education, that "we need to consider safeguards so that college students who received student loans do not become credit delinquents the moment they take their first step into society because their loan repayments fall into arrears."
In response, Korea Student Aid Foundation Chair Bae Byung-il said, "There are currently about 1.5 million student loan borrowers, and 97,000 delinquent debtors who are in arrears for more than six months, or about 6%, and among them, those flagged for credit caution (credit delinquents) number about 5,300, or 0.3%," adding, "(Compared to other countries) the actual arrears rate is quite low."
Bae said, "For income-contingent student loans repaid after employment, repayment is only possible after getting a job and earning a certain income, so there is no concept of arrears, but for standard repayment student loans, there is an arrears issue," and added, "We are putting in place programs such as partnering with various institutions in the financial sector to provide interest support."
The Korea Student Aid Foundation reported it will maintain a low-interest stance for college student loans this year. The lending rate for student loans for the first semester of the 2026 academic year was frozen at 1.7%. This rate has been maintained for five years since the first semester of 2021. For 4,952 long-term borrowers in vulnerable groups in arrears, the foundation, private financial companies, and local governments will jointly provide about 2.4 billion won in support.
It also decided to expand eligibility for interest exemptions for income-contingent loans (ICL). Currently, support is provided to those in student aid brackets 1–5, but a legal revision will be pursued to provide support to brackets 1–6 regardless of time limits. The student aid brackets are determined from 1–10 based on "recognized income," which reflects income as well as assets such as real estate, financial asset holdings, and automobiles, and liability circumstances.
Meanwhile, the Ministry of Education will begin agency briefings on Jan. 8 with the Korea Student Aid Foundation, the Korea Education and Research Information Service (KERIS), the Korea Advancing Schools Foundation (KASFO), and the National Research Foundation of Korea (NRF), and receive briefings from public and affiliated agencies for three days through Jan. 12. The briefings will be livestreamed on the Ministry of Education channel on YouTube.