Youth Leap Account Interest Rate Tentatively 5.5~6.5%... Industrial Bank of Korea Offers the Highest Rate

Final Interest Rate to Be Announced on the 12th

The preliminary interest rates for the ‘Youth Leap Account,’ set to launch in mid-month, have been determined at an annual rate of 5.5% to 6.5%. The highest rate offered was 6.5% by Industrial Bank of Korea (IBK). The final interest rates will be announced on the 12th after comparison among banks.

Kim So-young, Vice Chairman of the Financial Services Commission, is making an interim announcement on the 'Recruitment of Institutions Handling Youth Leap Accounts and Operational Directions' at the Government Seoul Office in Jongno-gu, Seoul, on the 7th. Photo by Yoon Dong-joo doso7@

On the 8th, the Korea Federation of Banks made the first public announcement of the tentative interest rates for the Youth Leap Account set by 11 banks, including the five major commercial banks (KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup). The base interest rate (fixed for 3 years) ranged from 3.5% to 4.5%, and the preferential interest rate based on income was 0.5%, with no differences among banks. The income-based preferential rate applies if ▲total salary is 24 million KRW or less ▲comprehensive income subject to tax standard is 16 million KRW or less ▲year-end settlement business income is 16 million KRW or less. The bank-specific preferential rates were set between 1.5% and 2.0%.

The Youth Leap Account is a policy financial product designed to help young people accumulate a lump sum of up to 50 million KRW at maturity by depositing 700,000 KRW monthly for five years. Eligible applicants are youths aged 19 to 34 with individual income of 60 million KRW or less and household income at or below 180% of the median. This policy financial product was pledged by President Yoon Suk-yeol during his presidential campaign to support asset formation among the youth. It will be sold by 12 banks, including the five major commercial banks, IBK, SC First Bank, and regional banks such as Busan, Gwangju, Jeonbuk, Gyeongnam, and Daegu Banks.

The highest interest rate was offered by IBK. Adding the base rate, income-based, and bank-specific preferential rates results in 6.5%. Six banks?Kookmin, Shinhan, Hana, Woori, Nonghyup, and Gyeongnam?offered 6.0%, Busan and Daegu Banks offered 5.8%, and Gwangju Bank offered 5.7%. SC First Bank did not disclose rates as it plans to start sales next year.

The rates announced on this day are not final. The banking sector plans to announce the final rates on the 12th after comparing and adjusting rates among banks.