Mid-to-low credit borrowers who had exhausted their entire annual-income credit loan limits secured an average of more than 9 million won in living funds through the mid-rate living stability loan launched late last month.
According to online loan brokerage platform Finda on the 9th, the average loan execution amount for borrowers of SBI Savings Bank's mid-rate living stability loan from June 29 to July 7 was 9.05 million won.
The mid-rate living stability loan is an exceptional product not subject to annual-income limit regulations, allowing borrowers in the bottom 50% of credit scores to borrow up to 10 million won. Six savings banks, including SBI Savings Bank, offer the product. A financial industry official said, "Many borrowers have essentially received the full limit, so satisfaction in the field is high."
Market interest is gradually increasing. From June 29 to July 7, the number of inquiries into SBI Savings Bank's living stability loan limits on Finda averaged 514 per day. This represents 5.3% of the total number of inquiries into SBI Savings Bank's overall personal credit loan limits during the same period. This week (the 6th and 7th), the daily average number of limit inquiries was 615, up 3.3% from last week's weekday average of 595.
The market assesses that the product is playing a role in easing the funding difficulties of vulnerable borrowers who stood at the boundary of the formal financial system. As raising funds has become difficult amid reduced credit loan limits, the exemption from annual-income limit regulations and the relatively low interest rate are drawing a positive response from real demand, according to the explanation. In fact, the upper interest rate is 15.27%, about 1 percentage point lower than the 16.15% of existing products. A savings bank official said, "It is still early after the launch, but the response is favorable," adding, "Since we plan to list on additional loan brokerage platforms, demand is expected to grow further."
