Ruling Party and Political Affairs Committee Discuss Household Debt... "It Is True That Concerns of Real Demanders Persist"

[Asia Economy Reporter Jeon Jin-young] The Democratic Party of Korea and the Financial Services Commission held a party-government consultation on the 25th to discuss supplementary measures for household debt management at the standing committee level.

On the morning of the same day, members of the Democratic Party's Political Affairs Committee and Financial Services Commission Chairman Ko Seung-beom held a party-government consultation on household debt management at the National Assembly and discussed these matters.

Kim Byung-wook, the ruling party secretary of the Political Affairs Committee, explained the purpose of the meeting in his opening remarks, saying, “The Political Affairs Committee and the Financial Services Commission held this party-government consultation to include measures that protect actual borrowers such as jeonse loans and balance payment loans while preventing the risk of financial instability in the additional household debt measures.”

[Image source=Yonhap News]

Kim said, “So far, the government has made various efforts to manage the pace of household debt increase and improve the quality of household debt, such as monitoring the increase in household loans, expanding the introduction of the Debt Service Ratio (DSR), and implementing total volume regulations,” but added, “However, concerns about actual borrowers, such as jeonse funds and the suspension of balance payment loans, have continued during the household debt management process.”

Chairman Ko said, “Household debt is currently very concerning in terms of its size and growth rate compared to the real economy, and I worry that it may become the biggest potential factor for our economy due to the deepening financial imbalance.”

He added, “In the process of managing household debt, we have made special efforts to protect vulnerable groups and actual borrowers and to maintain balance as much as possible. If the policies created this time are implemented without any setbacks, I expect that the impact can be minimized even if external shocks such as asset price adjustments occur in the future.”