Due to COVID-19... Card Loan Interest Rate Differential Application Prevention System Delayed by 2 Months

Delays in IT Development Due to COVID-19 Spread
Telephone Marketing Plans Proceed as Scheduled

[Asia Economy Reporter Ki Ha-young] The establishment of a system to prevent differential interest rates on card loans, which was intended to stop the practice of applying lower interest rates to new customers, has been delayed by about two months. This delay is due to disruptions in system development caused by the spread of the novel coronavirus infection (COVID-19).

The Credit Finance Association announced on the 3rd that the implementation of some measures to improve card loan practices will be postponed. The establishment of the system to prevent differential interest rates and the comparative disclosure of loan interest rates will each be delayed by two months. However, measures to strengthen financial consumer protection related to telephone marketing and internal control enhancements will be implemented as originally planned.

Previously, financial authorities and the card industry had prepared improvement measures for card loan practices in December last year and planned to implement them sequentially starting from April this year.

However, the industry explained that due to the spread of COVID-19, card company employees have been working remotely and dispersed, and manpower has been intensively allocated to financial support tasks for customers affected by COVID-19, causing difficulties in system development.

A Credit Finance Association official said, "We are focusing on the development and stable operation of related IT systems so that the small business and SME support program, which has been in effect since the 1st, can be carried out quickly and effectively," adding, "We ask for your understanding that the implementation is inevitably postponed as part of efforts to overcome COVID-19."