Per-capita bank household loans for borrowers in their 30s exceeded 100 million won for the first time on record last year, as high interest rates and rising housing costs continue to drive up debt levels among younger Koreans.
The outstanding bank loan balance per borrower in their 30s stood at 102.18 million won ($73,600) as of the end of last year, according to data the Bank of Korea (BOK) submitted to Rep. Park Sung-hoon of the People Power Party on the National Assembly's Strategy and Finance Committee. The figure rose 3.82 million won from a year earlier, marking the highest level since the central bank began compiling the data in 2013.
Loans for borrowers in their 30s have increased for two consecutive years. The per-capita balance grew from 93.5 million won at the end of 2023 to 98.36 million won at the end of 2024, before surpassing the 100 million won threshold last year. The trend reflects the combined impact of housing demand and living-cost burdens.
In contrast, per-capita loan balances for borrowers in their 20s continued to decline. The figure fell 2.88 million won from the previous year to 30.47 million won last year, extending a downward trend that has persisted for four consecutive years since the end of 2021.
The BOK attributed the decline largely to tighter lending regulations. Stricter debt service ratio (DSR) rules have reduced borrowing capacity for people in their 20s, who earn relatively less, the central bank said. Borrowers in their 20s tend to rely more heavily on unsecured credit loans than mortgage loans, making them more vulnerable to rising interest rates and tightened regulations, the BOK added.
Loan balances rose across other age groups. Per-capita debt for borrowers in their 40s climbed 5.22 million won over the year to 117 million won, hitting a record high and extending a three-year streak of increases since 2022.
Borrowers in their 50s and 60s also saw modest increases. The per-capita balance for those in their 50s edged up 890,000 won to 96.83 million won, while the figure for those in their 60s rose 270,000 won to 81.31 million won. Debt expansion was evident across nearly all age groups.
Average per-capita bank household loan balances across all borrowers also reached a record high. The figure stood at 91.52 million won at the end of last year, up 2.81 million won from the previous year.
"With a high exchange rate, high inflation, and mounting pressure for rate hikes, household debt is becoming a structural risk that could shake the national economy," Rep. Park said. "Preemptive risk-management strategies are urgently needed to prevent people in their 30s from sinking into a debt trap and losing economic dynamism."
