Banks expand services for foreign residents

The entrance to Jeonbuk Bank's financial center, set up exclusively for foreign nationals, in Suwon, Gyeonggi Province / Courtesy of Jeonbuk Bank

By Anna J. Park

There are more than 2 million foreign nationals residing in Korea, and banks are expanding the number of financial services available to this burgeoning demographic group to secure a new niche market for future growth.

Most major commercial banks have been providing diverse lineups of financial products to foreign customers, ranging from mortgage loans to savings accounts that are also available to local customers.

But several lenders are now offering foreign nationals even more.

Jeonbuk Bank, for instance, has been granting credit loans exclusively to foreign workers from 12 developing countries, including Nepal, Myanmar, Cambodia, Sri Lanka and Mongolia.

The regional bank, which began providing credit loans to foreign workers in 2016, has been expanding the service, setting up branches exclusively for foreign customers in Suwon, Gyeonggi Province, in 2018 and in Seoul's Dongdaemun District later. The branches are open even on weekends for the convenience of foreign workers, many of whom find it hard to visit banks during work hours on weekdays. They can borrow a maximum of 20 million won ($16,400) at an annual interest rate of 11 percent to 15 percent.

A total of 8,949 foreign customers have received the loans from the bank, with the total amount of extended loans standing at around 57.6 billion won.

“Jeonbuk Bank has been prioritizing the provision of necessary services for financially alienated foreign customers, rather than granting loans to foreign workers who belong to large conglomerates,” an official from the bank told The Korea Times. “The bank also plans to launch credit cards developed exclusively for foreign customers,” he added.

Woori Bank also operates a branch catering to foreign nationals in Ansan, Gyeonggi Province. Given that the region has a large population of foreign workers, the branch operates on weekdays as well as on Sundays for the convenience of customers. The bank also operates five branches, including in Gwanghwamun and Gimhae, which support foreign customers on Sundays.

The bank has also focused on younger foreign customers between 18 and 25 years of age, waiving their ATM transfer fees.

Other major banks like Shinhan and KB Kookmin also provide a range of loan and savings products for foreign customers. A Shinhan Bank official explained that foreign customers are able to enjoy almost the same scope of financial products from the bank, as long as they meet the qualifications for each product.