The Korea Times

'Inclusive finance' backfires as lower-credit borrowers receive better rates than higher-credit individuals

A government-initiated lending policy is backfiring against its purpose of supporting low-income borrowers as it also rewards those with low credit scores, industry officials said Monday. They said the policy, part of “inclusive finance” efforts, wrongly treats low-income and low-credit-score borrowers alike, even though low-credit borrowers may just be delinquent or inconsistent in repayment rather than low in earnings. Under the circumstances, these low-credit borrowers receive more favorable borrowing rates than those with higher credit scores, despite falling short on key credit assessment criteria, including repayment history and outstanding balances. Many intended beneficiaries of "inclusive finance" have credit scores between 651 and 700, placing them third-lowest of nine groups as defined by the Korea Federation of Banks, according to industry officials. Scores of 951 to 1,000 are the highest, while 600 or below is the lowest. Data compiled by the federation in October showed three of the four major commercial banks — KB Kookmin, Hana and Woori — charged higher rates for

Nov 24, 2025By Yi Whan-woo

'Inclusive finance' backfires as lower-credit borrowers receive better rates than higher-credit individuals

Economy

Weak won lifts exporter stocks, weighs on import-reliant firms in stock market

An increasingly weak won is expected to split the stock market, boosting exporters who earn more from stronger dollars while squeezing manufacturers that rely on imported raw materials and therefore face lower margins, analysts said Sunday. They forecast that stocks in semiconductors, automobiles, shipbuilding, defense and other export-oriented sectors are likely to benefit as the Korean currency remains in the 1,400-won range per dollar, a key psychological threshold. The won closed at a seven-month low of 1,475.6 per dollar on Friday. In semiconductors, beneficiaries include Samsung Electronics and SK hynix, which together account for more than one-fourth of the benchmark KOSPI’s market capitalization and earn about 80 to 90 percent of their revenue overseas. Their profits are expected to remain strong as global demand for DRAM and NAND flash stays robust through the fourth quarter. Automakers Hyundai Motor and its sister company Kia also face a favorable outlook for currency-driven revenue growth. “For every 10-won increase in the annual average exchange rate, combined operating pro

Nov 23, 2025By Yi Whan-woo

Weak won lifts exporter stocks, weighs on import-reliant firms in stock market

Policy

Gov't push for low car insurance premiums creates dilemma for insurers as profits fall

Non-life insurers are facing a car insurance dilemma, as their need for higher premiums to grapple with falling profits clashes with the government’s shared growth initiative, industry officials said Thursday. The government wants to keep premiums low because car insurance has a heavy influence on the consumer price index and affects more than 25 million subscribers — nearly half of Korea’s population. For non-life insurers, however, this strategy has become unsustainable, as they struggle with declining profits while premiums remain largely unchanged. A total of 31 non-life insurers nationwide posted a combined net profit of 6.46 trillion won ($4.39 billion) from January to September, a 19.6 percent drop from a year earlier. The year-on-year decline was largely driven by the car insurance sector, where the five largest insurers — Samsung Fire & Marine Insurance, DB Insurance, Meritz Fire & Marine Insurance, Hyundai Marine & Fire Insurance and KB Insurance — posted a combined loss ratio of 93.2 percent, up 7.1 percentage points from last year. In the third quarter alone, car ins

Nov 21, 2025By Yi Whan-woo

Gov't push for low car insurance premiums creates dilemma for insurers as profits fall

Economy

NTS chief underscores global tax cooperation in OECD-hosted meeting

National Tax Service (NTS) Commissioner Lim Kwang-hyun underscored the importance of international cooperation in recovering uncollected taxes during a OECD-hosted meeting of top tax officials in South Africa, the NTS said Thursday. Lim stressed that recovering all tax debts, including those owed by delinquent and evasive individuals, along with properly managing overdue taxes, is critical for achieving tax justice. He made the remarks at the 18th Plenary Meeting of the OECD Forum on Tax Administration (FTA) in Cape Town, attended by 54 countries and multinational financial institutions, including the International Monetary Fund, highlighting Korea’s push for fair and transparent taxation under the Lee Jae Myung administration. These enforcement measures include investigation, seizure and auction of overseas assets held by delinquent taxpayers that are difficult to access domestically. “Commissioner Lim emphasized the importance of achieving tax justice through delinquent tax management and collection cooperation,” the NTS said. The agency noted that the issues Lim raised were among

Nov 20, 2025By Yi Whan-woo

NTS chief underscores global tax cooperation in OECD-hosted meeting

Economy

Nearly half of SMEs seek more foreign workers amid labor shortages

More than four out of 10 small and medium-sized enterprises (SMEs) in Korea want to hire more foreign workers and see the maximum annual quota raised, a survey showed Wednesday. The survey, conducted by the Korea Employers Federation (KEF), comes as SMEs increasingly struggle to secure domestic labor, with more than six out of 10 saying they rely on foreign workers to fill the gap. The poll covered 312 companies with fewer than 300 employees in the manufacturing, construction and service sectors. These areas are heavily reliant on manual labor and have been hiring foreign workers under the Employment Permit System with E-9 visas. Among the 312 firms, 45.2 percent said future quota for foreign workers should be higher than this year's, which currently stands at 130,000, down from an all-time high of 165,000 in 2024. Another 43.6 percent said the quota should remain the same, 8.3 percent said it should decrease and 2.9 percent supported removing the cap entirely. By industry, 46 percent of manufacturing firms and 48 percent of construction firms said the number of E-9 visa workers should be

Nov 19, 2025By Yi Whan-woo

Nearly half of SMEs seek more foreign workers amid labor shortages

Policy

Korea's alternative stock exchange faces foreign investor complaints over 15% trading cap

Nextrade, Korea’s first alternative stock exchange, is facing complaints from foreign investors over a rule that limits trading volume, industry officials said Wednesday. Under the regulation set by the Financial Services Commission, Nextrade cannot account for more than 15 percent of the total trading volume on the Korea Exchange (KRX). The rule is designed to ensure that Nextrade, which launched in March, challenges the KRX’s nearly 70-year monopoly without expanding excessively or creating unnecessary market competition. Nextrade has gained a competitive edge over the regular KRX market by offering longer trading hours — from 8 a.m. to 8 p.m. — giving investors greater flexibility than the standard weekday window of 9 a.m. to 3:30 p.m. However, the 15 percent cap rule has become a stumbling block for investment, as Nextrade does not transparently or promptly share how close it is to the cap or which stocks may be temporarily removed, according to industry officials. They said this lack of transparency is especially challenging for foreign investors, who face language and other

Nov 19, 2025By Yi Whan-woo

Korea's alternative stock exchange faces foreign investor complaints over 15% trading cap

Economy

Economic toll of ‘resting’ young people deepens

A woman surnamed Paik says her heart breaks to see her son, who is in his late 30s and has a master’s degree, give up on finding employment after quitting several jobs due to a poor job fit, low salaries and other reasons. “He's wasted almost his entire 30s at home, years that could have been financially productive if he had been working,” said Paik, who asked to be identified only by her surname. When asked whether her son felt any pressure to find a job by comparing himself with his schoolmates, Paik said that some of them had also stopped trying, which only reinforced his decision to remain idle. The grim reality facing Paik’s son and his peers is reflected in the rising number of Koreans in their 20s and 30s who have given up looking for work long-term instead of building careers and advancing financially. These Koreans are categorized as “resting” individuals, separate from unemployed people — those who are willing to work but have no jobs — who are still considered “economically active.” Resting individuals are also distinguished from people whose careers are on

Nov 18, 2025By Yi Whan-woo

Economic toll of ‘resting’ young people deepens

Policy

Korean elite’s double standard in home ownership persists: surveys

Lawmakers and high-ranking bureaucrats in both central and municipal governments own multiple homes despite the deepening housing crisis, according to recent surveys. The findings reflect the persistent double standard of Korea’s elite, as tighter regulations make it hard for ordinary citizens to buy homes, while those in power remain largely unaffected. According to data from corporate tracker Leaders Index, Tuesday, 48.8 percent of 2,581 central and local government officials of Grade 4 or higher, along with their family members, own two or more homes, and 17.8 percent hold three or more. Central government officials held the highest average number of homes per person at 1.89, followed closely by municipal governors at 1.87. Local council members and officials at public institutions or government-funded think tanks held around 1.71 homes each, while members of the National Assembly owned an average of 1.41 homes. Among municipal governors, Cho Seong-myung, head of Seoul’s upscale Gangnam District, had the highest number of homes at 42. Rep. Park Min-kyu of the ruling Democratic Party

Nov 18, 2025By Yi Whan-woo

Korean elite’s double standard in home ownership persists: surveys

Policy

Shareholder meetings remain heavily concentrated despite efforts to spread dates

Shareholder meetings of more than 90 percent of listed companies in Korea still heavily overlap, despite a government-led campaign to spread the dates and encourage greater participation, according to a report released Monday. The report, authored by Korea Capital Market Institute researcher Hwang Hyun-young, found that 96.4 percent of the 2,583 companies with December fiscal year-ends held their meetings between March 20 and 31 this year. Notably, over 60 percent of these meetings occurred on just three working days — March 26, 28 and 31. The findings come as financial authorities have urged companies to disperse meeting dates to give shareholders more time to participate in decision-making. To this end, authorities have implemented policies such as offering incentives to promote dispersion and operating voluntary compliance programs. “Even with these initiatives, the concentration of shareholder meetings at the end of March persists, casting doubt on the effectiveness of the measures,” Hwang said. She compared the situation with the United States, where 74 of the 100 largest compan

Nov 18, 2025By Yi Whan-woo

Shareholder meetings remain heavily concentrated despite efforts to spread dates

Banking & Finance

Hanwha’s non-life insurer faces costly claims after E-Land warehouse fire

Hanwha General Insurance faces potentially costly claims after a massive fire at a warehouse where it serves as a primary insurer, with damages estimated in the hundreds of billions of won, according to industry officials Monday. The non-life insurance arm of Hanwha Group said it is “assessing the situation,” declining to provide further details about the blaze at E-Land Fashion’s logistics center in Cheonan, South Chungcheong Province, on Saturday. Industry officials, however, reckon that it could result in sizable claims, noting that the logistics center is one of Asia’s largest and serves as the central hub of retail giant E-Land’s fashion business. The facility spans from a basement level to four floors aboveground, covering 193,210 square meters — equivalent to 27 football fields. It can accommodate 150 trucks at once and handle up to 50,000 boxes, storing more than 11 million clothing items. Fire authorities confirmed there were no casualties, but most of the inventory is believed to have been destroyed in the blaze. “Hanwha General Insurance takes on a costly responsib

Nov 17, 2025By Yi Whan-woo

Yi Whan-woo

Read more

'Inclusive finance' backfires as lower-credit borrowers receive better rates than higher-credit individuals

Weak won lifts exporter stocks, weighs on import-reliant firms in stock market

Gov't push for low car insurance premiums creates dilemma for insurers as profits fall

NTS chief underscores global tax cooperation in OECD-hosted meeting

Nearly half of SMEs seek more foreign workers amid labor shortages

Korea's alternative stock exchange faces foreign investor complaints over 15% trading cap

Economic toll of ‘resting’ young people deepens

Korean elite’s double standard in home ownership persists: surveys

Shareholder meetings remain heavily concentrated despite efforts to spread dates

Hanwha’s non-life insurer faces costly claims after E-Land warehouse fire

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