Business · Economy · 3 hrs ago
Living costs drive record share of loans among South Korea’s poorest
South Korea’s poorest households increasingly borrowed to cover living costs last year, according to national statistics.
Among households in the lowest fifth by assets, 45.3% of unsecured loans were for living costs, the highest share since records began in 2017.
The lowest-income fifth also reached a record, with 38.2% of unsecured loans used for living costs.
The pattern differed among wealthier households, where business funding was a more common reason for borrowing.
Unsecured loans usually carry higher interest rates than loans backed by property or other collateral.
Experts warn that repayment costs could push financially vulnerable borrowers into deeper debt or toward informal lenders.
Experts say stronger policy support is needed to reduce reliance on these loans; no specific next steps are given.
The share of unsecured loans used for living expenses reached record highs among South Korea’s lowest asset and income groups.
Among households in the lowest asset fifth, 45.3% of unsecured loans were for living expenses last year, the highest share since records began in 2017.
The figure for the lowest income fifth was 38.2%, also a record.
Unsecured loans typically carry higher interest rates than secured loans, raising concerns about repayment pressure on vulnerable borrowers.
Experts warned that people borrowing for basic expenses could fall deeper into debt or turn to private lenders.
- Who
- Households in the lowest 20% by assets and income.
- What
- Record shares of their unsecured loans were used for living expenses.
- When
- Last year, according to data reported on November 2, 2026.
- Where
- South Korea.
- Why
- The loans were used to meet living costs; the sources do not state a more specific cause.
This story does not have two clearly opposing sides.
Statistics on loan purposes began, and 33.4% of unsecured loans among the lowest asset fifth were for living expenses.
The living-expense share among the lowest asset fifth first exceeded 40%, reaching 41.9%.
The share reached 45.3% for the lowest asset fifth and 38.2% for the lowest income fifth.
Maeil Business reported the figures, citing data from the national statistics portal.
- Lowest asset fifth
- 45.3% of unsecured loans were for living expenses last year
- Lowest income fifth
- 38.2% of unsecured loans were for living expenses last year
- Lowest asset fifth record
- Highest share since statistics began in 2017
- Asset second fifth
- 32.5% of unsecured loans were for living expenses
- Asset third fifth
- 27.3% of unsecured loans were for living expenses