Korea seeks to toughen pension eligibility for foreign residents as loophole found

The government is tightening regulations on the national pension following concerns that a legal loophole could let foreign residents unfairly secure old-age pension benefits.

It is considering limiting a retroactive payment system only to foreign nationals whose countries also provide reciprocal measures to Koreans in those nations.

The controversy emerged recently as some foreign nationals were found to have applied for the retroactive payment system in the national pension scheme.

The retroactive payment system allows both Korean and foreign subscribers to pay missed premiums in one lump sum, covering up to 119 months, to fill contribution gaps. This qualifies them for a lifelong monthly pension once their contribution period exceeds 120 months.

Recently, a news outlet reported on a case in which a foreign national worked in Korea for just one month and still secured a lifelong old-age pension by taking advantage of the loophole.

Foreign nationals aged 18 to 59 who work at a domestic company or run their own business can join the National Pension Service (NPS) schemes. As of last year, the number of subscribers was roughly 490,000.

Foreign applicants making any number of pension back-payments nearly tripled in just two years, from 530 in 2023 to 1,517 in 2025, and reached 994 in the first half of 2026, according to data submitted by the NPS to Rep. Kim Kyo-heung of the Democratic Party of Korea.

A government probe after the report found only three cases of foreign applicants participating in the one-month enrollment, 119-month retroactive payment scheme. The health ministry announced Wednesday that of the three foreign nationals who fit the pattern, only one, an ethnic Korean non-national who lived in Korea for the entire retroactive payment period, currently receives a pension.

Although the number is small, many said the issue exposed broader flaws in how the system is run.

This prompted President Lee Jae Myung to order countermeasures on Tuesday.

“Giving this kind of benefit to foreigners seems unusual. We have no obligation to offer retroactive payment when other countries don't offer it to our nationals,” Lee said at a Cabinet meeting Tuesday.

Relevant government organizations presented measures to close the loophole.

Under the new measures that took effect Monday, foreign nationals' retroactive payments are not allowed for any months during which they were not in Korea. While the previous regulation counted the period they held residency status, the new rule will count how many months they "actually stayed" here. A month will be counted only when they stayed for at least 15 days. The NPS will verify the duration through the applicants' entry and exit records.

The government is also seeking to change the law to recognize retroactive payments only for nationals of countries where Koreans there are allowed to make similar payments, as Lee ordered. It has not yet specified a timeline or which countries would be affected.

Kim Sung-joo, head of the NPS, said the system needs revision but cautioned against discrimination toward foreign nationals.

“What matters is not nationality but premium payment and contribution period. Foreigners should not be excluded outright, nor given special treatment on that basis alone,” he wrote on social media, adding that he hopes this controversy does not lead to hatred toward foreign residents or any specific country.