Gwangju Bank Launches 'Prime Plus Loan,' a Mid-to-Low Credit Customer Mid-Interest Rate Personal Loan

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] Gwangju Bank (President Song Jong-wook) announced on the 27th that it has launched a mid-interest rate credit loan called ‘Prime Plus Loan’ for middle- and low-credit customers.

The ‘Prime Plus Loan’ provides loans of up to 50 million KRW at reasonable interest rates not only to middle- and low-credit borrowers who cannot overcome the high loan thresholds of banks but also to high-credit borrowers who have practical repayment ability but cannot have a limit calculated due to existing loan amounts.

This product, expected to become a groundbreaking model for mid-interest rate loans in the primary financial sector through institutional measures that can fulfill President Song Jong-wook’s priority project of inclusive finance while satisfying risk management, can be applied for anytime via mobile (smart banking, mobile web banking) by salaried workers, and the repayment period can be freely selected within a maximum of 5 years. There is no prepayment penalty.

Through the ‘Prime Plus Loan,’ Gwangju Bank expects to identify the financial needs of consumers who have not been included in the primary financial sector and to embrace middle- and low-credit customers into the primary financial sector by calculating appropriate limits and interest rates within a manageable risk range.

In particular, the ‘Prime Plus Loan’ actively introduced a new evaluation model using machine learning techniques that secure risk discrimination by utilizing various data items through joint product development with an external credit rating agency.

Thus, the plan is to simultaneously achieve the two goals of practicing inclusive finance for middle- and low-credit customers and strengthening risk management.

Jo Jeong-min, Head of Digital Business Division at Gwangju Bank, said, “Through the launch of the ‘Prime Plus Loan,’ we differentiated it from existing products by thoroughly identifying the repayment ability of financially marginalized groups through detailed market analysis and the latest evaluation techniques,” adding, “We expect it to become a new model for mid-interest rate products in the primary financial sector, and we will continue to do our best to develop financial products that embrace middle- and low-credit customers and the common people and meet the diverse needs of financial consumers.”