Empowering the Vulnerable: Financial Services Commission Unveils ‘Benefit to Benefit’ Initiative with 0.5% Interest Rate Cut

Additional related benefits provided to those related to finance, employment and welfare

Interest rate reduction benefits for small living expenses loans for lease membership subscribers

Providing credit consultation and debt management to users of the employment support system through complex support

A ‘benefit on benefit’ has been added to help vulnerable groups become self-reliant as quickly as possible. Interest rate reduction benefits (0.5%p) are provided for small living expenses loans and credit and debt management consulting.

Last June, the Financial Services Commission published the ‘Complex Financial, Employment and Welfare Support Scheme (Combined Support Scheme)’ in conjunction with related organisations. As part of strengthening the complex support scheme, related organizations will implement ‘a plan to reduce interest rates on small living expenses loans for welfare membership subscribers and a plan to strengthen financial support for users of the employment support system through complex support’ from the 28th . .

First, if the user of the Small Living Expenses Loan from the Korea Inclusive Finance Agency subscribes to the welfare membership of the Ministry of Health and Welfare, a reduction in the interest rate (0.5%c) is provided on the small living expenses loan.

The small living expenses loan is a system introduced in 2023 to support the urgent livelihood needs of vulnerable groups and reduce exposure to illegal private financing. As it targets vulnerable and low-income groups, customers using small living expenses loans have a high probability of receiving welfare services and a high need for receiving them. However, there are realistic difficulties for citizens who are busy with their livelihoods to take care of welfare services one by one. Accordingly, through this improvement to the system, customers using small living expenses loans will be encouraged to register for welfare membership so that they do not miss out on welfare services due to ignorance.

Starting from the 28th, customers who apply for a small living expenses loan through the Microfinance Integration Support Center will receive a 0.5% interest rate reduction by submitting a ‘welfare confirmation membership subscription’. Confirmation of welfare membership can be issued at the administrative welfare center (community centre) of each local government.

In addition, customers receiving employment assistance from the Ministry of Employment and Labor through the Microfinance Integration Support Center or the Microfinance app ‘Itda’ will also be able to use the Credit and Debt Management Consulting provided by the Korea Inclusive Finance Agency .

Credit consulting and debt management is a service where financial experts, such as credit advisers and financial welfare advisers, check the credit score and debt status of the person being consulted every month (up to 6 months) and provide tailored solutions. 1:1 tailoring to improve financial life. Previously only policy microfinance users such as employee sunshine loans and small living expenses loans could use consultation. However, with this improvement to the system, if you are receiving employment support from the Ministry of Employment and Labor through the Microfinance Integration Support Centre, you can now use consultation without using policy microfinance.

The Korea Inclusive Finance Agency plans to inform those who are eligible about the credit and debt management consultation system through notification messages (text messages). It is expected that, by expanding the scope of consultation provided, the unemployed and the disadvantaged will be able to obtain significant support in employment and financial life.

Meanwhile, the Financial Services Commission plans to review compound support performance in 2024 with related institutions in December and publish plans for the promotion and development of compound support in 2025. The plan will include expanding complex support inflow channels and expanding services complex support.
Jose Ilbo / Correspondent Lee Min-jae myfinkl@joseilbo.com