Even Lowest Credit Score Holders Can Get Credit Cards... Haetsalron Card Launches on the 27th

Even Lowest Credit Score Holders Can Obtain Credit Cards Within Their Repayment Capacity

[Asia Economy Reporter Park Sun-mi] Starting on the 27th, with the launch of the policy-based low-income financial product, the Haetsalron Card, even individuals with the lowest credit scores will be able to receive and use credit cards within their repayment capacity.

According to the Financial Services Commission on the 25th, the Haetsalron Card, designed to improve payment convenience for vulnerable low-income groups and allow them to enjoy credit card benefits such as points, will be released starting on the 27th. On the 27th, six card companies including Lotte, Woori, Hyundai, KB Kookmin, Samsung, and Shinhan Card will launch the card first, and Hana Card is scheduled to launch it by mid-November.

The eligible users are vulnerable low-income groups who meet the following criteria: completion of three mandatory Haetsalron Card education courses, annual disposable income of 6 million KRW or more, and a personal credit score in the bottom 10% or lower while not currently holding a personal credit card as of the guarantee application date. Based on the borrower's repayment willingness index and creditworthiness, the guarantee review will assign a guarantee amount up to 2 million KRW, and the card usage limit will be set lower than the guarantee limit considering unauthorized payments (such as transportation and communication fees).

However, the use of long- and short-term card loans (card loans, cash services), installment period restrictions (maximum 6 months), and certain categories such as entertainment and gambling industries are restricted. Since the card is issued with a guarantee, increasing the usage limit is also not possible.

After applying for a guarantee through the Korea Inclusive Finance Agency and undergoing a review, a guarantee agreement is signed, and the applicant can choose one of the seven affiliated card companies to apply for card issuance. Except for restrictions in line with the purpose of the policy-based low-income financial product (such as limitations on long- and short-term card loans), the usage method is the same as a regular credit card.

A financial authority official advised, "From the perspective of risk management by the Korea Inclusive Finance Agency and card companies, if deemed necessary due to occurrences such as delinquencies, the usage limit of the Haetsalron Card may be reduced or card usage may be suspended."