Helping Re-entrepreneurs and Youth Credit Recovery... Introducing 'Financial Safety Block'

Authorities Announce Amendments to Credit Information Regulations
Also Promote Introduction of Secure Financial Transaction Blocking System

Measures to restrict the sharing of past disadvantageous information for credit recovery of diligent re-entrepreneurs with high motivation for a fresh start are being promoted. Additionally, a 'Financial Transaction Safe Blocking (Opt-Out)' service will be introduced to prevent voice phishing damage.

On the 28th, the Financial Services Commission held a 'Credit Information System Improvement Meeting' at the Bankers' Hall in Jung-gu, Seoul, chaired by Vice Chairman Kim So-young, where they announced ▲ amendments to credit information laws to support credit recovery for re-entrepreneurs and youth ▲ and plans to promote a financial transaction safe blocking system.

Kim So-young, Vice Chairman of the Financial Services Commission, is delivering opening remarks at the 'Dialogue between the FSC 2030 Advisory Group and the Financial Sector' held on the 24th at the Seoul Jung-gu Community Financial Promotion Agency. Photo by Kang Jin-hyung aymsdream@

First, the authorities will begin improving systems to support credit recovery for re-entrepreneurs and youth. For re-entrepreneurs, if they pass the 'Diligent Management In-depth Evaluation' operated by the Small and Medium Business Corporation, the sharing of negative credit information with financial institutions will be restricted. The Diligent Management In-depth Evaluation refers to a system that assesses efforts to prevent business closure and readiness for a fresh start, providing benefits such as preferential interest rates to those who pass.

Additionally, the authorities will promote awarding credit score bonuses to youth who have maintained Youth Leap Accounts for a long period. Personal credit evaluation companies will be able to utilize Youth Leap Account information concentrated at the Credit Information Center so that youth who maintain these accounts long-term will automatically receive credit score bonuses.

A financial transaction safe blocking service to prevent voice phishing damage will also be introduced. Currently, even if consumers request blocking of financial transactions due to concerns about voice phishing, other financial companies cannot verify this. Going forward, all financial companies will be able to check whether a consumer has preemptively blocked financial transactions when conducting new loans, card issuance, and other financial transactions. Accordingly, the amendment includes provisions allowing the 'preemptive financial transaction blocking information' applied for by consumers to be shared and utilized through the Credit Information Center for system implementation.

Alongside this, institutional improvements related to data utilization will be undertaken. Grounds will be established for information providers to impose disadvantages if MyData operators fail to pay information transmission fees, and credit card merchant recruitment work will be added to the concurrent businesses that MyData operators can engage in.

Furthermore, the scope of financial disorderly persons will be expanded to promote sound financial order. Currently, unfair trading actors under the Capital Markets Act are not included among financial disorderly persons registered with the Credit Information Center, so there are no restrictions on their financial transactions. The amendment includes unfair trading actors under the Capital Markets Act as financial disorderly persons, allowing financial companies to utilize this information during loan screening, card issuance, and other processes.

The amendment to the Enforcement Decree of the Act on the Use and Protection of Credit Information containing these details will undergo legislative notice until May 7, and the amendment to the Credit Information Business Supervision Regulations will undergo regulatory change notice until April 9. The Financial Services Commission plans to expedite related procedures to enable the amendments to be implemented within the first half of the year.

Vice Chairman Kim stated, “The credit information system improvement measures discussed today are timely and meaningful as they can help policy beneficiaries such as re-entrepreneurs, youth, and the elderly, who may be more socially and economically vulnerable in difficult economic conditions,” adding, “We will promptly proceed with follow-up measures for the announced plans so that policy beneficiaries can quickly receive benefits.”