Regional Banks Also Planning 'Joint Loans' Launch
Foreign Currency Services in Preparation
CEO Hong Min-taek "Mortgage Loans Must Be Launched, but Timing Is Undecided"
Hong Min-taek, CEO of Toss Bank, held a press conference on the 5th at the Conrad Hotel in Yeouido, Seoul, introducing management performance and other matters. Photo by Hyunmin Kim kimhyun81@
Toss Bank announced on the 5th that it will launch a jeonse and wolse deposit loan. Having mainly handled unsecured loans so far, Toss Bank is expanding its scope by introducing the jeonse and wolse deposit loan.
On the morning of the same day, Toss Bank held a press conference at the Conrad Hotel in Yeouido, Seoul, stating, "We have introduced the first-ever internet-only bank service that allows customers to apply for the jeonse deposit return guarantee entirely online in a one-stop process."
Launch of Jeonse and Wolse Deposit Loan... Interest Rates as Low as 3.32% per Annum
The Toss Bank jeonse and wolse deposit loan consists of general, youth, and multi-child special categories. Toss Bank offers customized proposals based on income, age, and family composition.
The general category is available to anyone and offers loans up to 88% of the rental deposit, with a maximum loan amount of 222 million KRW. However, income and debt ratios are applied. The youth category targets individuals aged 34 or younger who are also non-homeowners. Loans are available up to 90% of the rental deposit, with a maximum of 200 million KRW.
Toss Bank is the first internet-only bank to introduce a ‘multi-child special loan.’ This is for customers with two or more minor children, offering loans up to 88% of the rental deposit, with a maximum of 222 million KRW. The loan limit and benefits are provided regardless of income or debt levels.
The interest rates are 3.32?5.19% for the general and multi-child special loans, and 3.42?4.06% for the youth loan.
Park Shingeon, Product Owner (PO) of Toss Bank, held a press conference on the 5th at the Conrad Hotel in Yeouido, Seoul, introducing the Jeonwolse deposit loan product. Photo by Hyunmin Kim kimhyun81@
From Jeonse Keeper Guarantee to Registration Change Alerts
This loan introduces ‘Toss Bank Care,’ which includes the Jeonse Keeper Guarantee and registration change alerts.
Previously, the jeonse return guarantee required a guarantee fee ranging from tens of thousands to hundreds of thousands of KRW. However, the Jeonse Keeper Guarantee, introduced through a partnership between Toss Bank and the Housing Finance Corporation (HF), applies a guarantee fee of 0.02?0.04%. For example, for a deposit of 200 million KRW, the minimum guarantee fee for two years is about 80,000 KRW. Additionally, up to 100,000 KRW of the guarantee fee will be supported until the end of the year, allowing customers to experience free enrollment during this period. The coverage of the Jeonse Keeper Guarantee has been expanded to include detached houses, villas, and multi-family houses.
Moreover, notifications are provided via the Toss app whenever there is a change in the property owner's financial information. After a contract is signed with the landlord, if there are any changes related to the house you live in or will live in, you will receive alerts. From changes in ownership to mortgage execution and provisional seizure, Toss Bank expects that tenants will be able to respond quickly by having a clear overview of changes surrounding their residence.
Launch of Joint Loans, Foreign Currency Services, and Child Services
Hong Min-taek, CEO of Toss Bank, also revealed three upcoming services. He explained, "We are preparing a joint loan service where Toss Bank and partner banks each handle 50% of the loan, in a win-win model with regional banks." In addition, Toss Bank plans to launch foreign currency services and ‘child services.’
Regarding concerns from financial authorities about the increase in household loans, CEO Hong said, "Jeonse and wolse deposit loans and mortgage loans are fundamentally different in nature. Jeonse and wolse loans are provided for residential purposes, so they are products focused on actual demand."
He added, "Housing issues for young people in their 20s and 30s are a very serious social problem and this is an opportunity to address it. We are closely monitoring the increase in household debt that the market is concerned about and will proceed while considering various factors such as the pace of loan execution."
Regarding the future launch of mortgage loans, he stated, "We will launch when the market environment is ready. The specific timing has not yet been determined."
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