Kakao Pay "Refinancing Loans Can Save Up to 2.9 Million KRW in Annual Interest"

Implementation of Credit Loan Refinancing Service at the End of May
Average Annual Interest 700,000 KRW · Interest Rate Reduced by up to 14%p

Kakao Pay announced on the 29th that financial consumers who refinanced their loans through its platform saved an average annual interest of 700,000 KRW. Some consumers reportedly saved up to 2.9 million KRW annually.

In May of this year, Kakao Pay joined the refinancing loan infrastructure policy aimed at reducing the interest burden on financial consumers and has partnered with the most first-tier financial institutions among platforms. Currently, it introduces refinancing loan products from a total of 29 financial companies, including 12 banks, 9 savings banks, 4 card companies, and 4 capital companies.

As a result of cooperation with various financial companies, including the five major commercial banks, Kakao Pay explained that the actual interest burden on financial consumers has significantly decreased. One financial consumer who switched from a card company loan to a commercial bank loan through Kakao Pay enjoyed an interest rate benefit lowered by 14 percentage points, from 19.9% to 5.9%.

The platform offers the ‘My Loan Limit’ service, which allows users to compare loan products from multiple financial companies via KakaoTalk or the application (app) without needing to visit financial institutions in person. For new loans, users can view 150 products, including 113 unsecured loans, 16 jeonse (key money deposit) loans, 9 mortgage loans, and 11 auto-secured loans. Policy-based loans for low-income households, such as the Buttimgok Jeonse Fund Loan, and bank rental deposit loans are also available for review.

Since its launch, approximately 6.4 million people, equivalent to 22% of South Korea’s total economically active population, have used this service over 3 years and 5 months. The cumulative number of loan comparison transactions performed is about 28 million. The number of loan products introduced reaches approximately 3 billion.

Kakao Pay plans to enhance consumer benefits in upcoming refinancing services for mortgage and jeonse fund loans through algorithm advancement and expansion of partnerships. Kakao Pay stated, “Following unsecured loan refinancing, we will sequentially launch refinancing services for mortgage and jeonse fund loans, focusing on increasing tangible benefits for financial consumers across all loan types.”