Business · Economy · 2 hrs ago
Delinquency on South Korea’s Emergency Loan Reaches 44.3%
South Korea’s emergency loan program is meant to help people who cannot easily borrow from mainstream lenders avoid illegal private lenders.
44.3% of the loan balance was overdue at the end of September, up from 11.7% in 2023.
Borrowers aged 20 or younger had the highest delinquency rate, at 50.7%.
The program lends up to 1 million won for urgent expenses to people with low incomes or poor credit.
From next year, the government plans to replace it with a scheme provisionally called the K-Minsaeng Jikim Loan, open to people in the bottom half of the credit-score range regardless of income.
The planned loan would offer up to 1 million won at 4.5% interest, with another 1 million won available to borrowers who repay reliably.
Some critics worry that removing the income limit could leave less support for people with the lowest incomes, while officials say it would also cover people facing unexpected hardship.
Delinquency on South Korea’s emergency loan program reached 44.3% at the end of September.
Of 314 billion won in outstanding loans, 139.1 billion won was overdue.
Borrowers aged 20 or younger had the highest delinquency rate, at 50.7%.
The program provides loans of up to 1 million won to people who may struggle to access mainstream finance, aiming to keep them from turning to illegal lenders.
The government plans to revise the program next year, while some have warned that widening eligibility could reduce support available to low-income borrowers.
- Who
- Borrowers in South Korea’s Emergency Loan program. Those aged 20 or younger had the highest delinquency rate.
- What
- The program’s delinquency rate reached 44.3%.
- When
- At the end of September. The figures were reported on November 4, 2026.
- Where
- South Korea.
- Why
- The program is intended to provide emergency funds to people with low incomes or low credit scores who struggle to use mainstream finance, and to help prevent them from turning to illegal lenders.
People concerned about support for low-income borrowers
Financial authorities
Eligibility
People concerned about support for low-income borrowers
They worry that removing income limits could reduce the support available to low-income people who need it most.
Financial authorities
Authorities say the program is fundamentally emergency funding for low-income and low-credit borrowers.
Access
People concerned about support for low-income borrowers
They warn that broadening eligibility could leave less capacity for those most in need.
Financial authorities
Authorities say income requirements were removed so people facing unexpected circumstances, such as disasters or illness, would not be excluded.
The program’s delinquency rate was 11.7%.
The delinquency rate rose to 32.2%.
The delinquency rate reached 37.8%.
The delinquency rate stood at 42%.
The delinquency rate reached 44.3% at the end of the month.
The government plans to overhaul the program as the tentatively named K-Minjung Support Loan.
- Overall delinquency rate
- 44.3% at the end of September
- Overdue balance
- 1.391 trillion won out of 3.14 trillion won in outstanding loans
- Highest age-group rate
- 20 or younger: 50.7%
- Loan limit
- Up to 1 million won under the current program
- Planned replacement
- K-Minjung Support Loan, tentatively named, next year
What people are saying
Basically, this is emergency funding for low-credit and low-income borrowers who have difficulty using mainstream finance.
However, we removed the income requirement so as not to exclude people facing unexpected special circumstances such as disasters or illness.