'Cheongnyeon Doyak Account' Early Termination Rate Reaches 11%... Budget Also Carried Over 300 Billion Won

1.43 Million Subscribers with Over 160,000 Mid-Term Cancellations
Annual Budget Increased, 1.1 Trillion Won Allocated Over 3 Years
Rep. Kim Hyunjung "Questioning Policy Effectiveness, Additional System Improvements Needed"

The Financial Services Commission's youth-tailored policy, the ‘Youth Leap Account,’ is reportedly not being properly implemented. The Youth Leap Account is a policy-type financial product designed to support the mid- to long-term asset formation of young people, funded by the Financial Services Commission’s contribution to the Korea Inclusive Finance Agency. It allows flexible monthly deposits up to 700,000 KRW within a 5-year (60 months) maturity period, providing up to 6% government contributions monthly and tax exemptions on interest income.

According to data submitted to Kim Hyun-jung, a member of the National Assembly’s Political Affairs Committee from the Democratic Party of Korea, by the Financial Services Commission and the Korea Inclusive Finance Agency on the 24th, the number of Youth Leap Account subscribers reached 1,438,000 as of August this year. However, 161,000 of them terminated their accounts early, resulting in an early termination rate of 11.2%.

Despite this high termination rate, the budget for the Youth Leap Account has been increased annually. The budget was set at 367.81 billion KRW in 2023, 368.211 billion KRW in 2024, and 375 billion KRW in 2025, totaling 1.111 trillion KRW over three years.

Rep. Kim pointed out that the biggest issue is the questionable effectiveness of the policy, with a large portion of the budget remaining unspent and carried over. In 2023, 303.22 billion KRW of the Youth Leap Account budget was carried over, and in 2024, approximately 284.3 billion KRW is expected to be carried over.

In response to a written inquiry from Rep. Kim’s office regarding the expected trend of new subscribers to utilize the carryover amount, the Financial Services Commission replied, “The number of subscribers is not a project goal” and “Subscription performance is not managed to exhaust the remaining (carryover) amount.”

Rep. Kim stated, "Despite questions being raised about the policy’s effectiveness due to increasing early terminations and shortfalls in new subscriptions, the Financial Services Commission has not even discussed measures to increase new subscriptions to utilize the carryover budget." She added, "The National Assembly Budget Office pointed out that the budget remaining with the Korea Inclusive Finance Agency, including carryover amounts and recovered funds, should be returned to the national treasury without separate processing, but no significant action has been taken so far." She further emphasized, “Prompt institutional improvements are necessary to help young people build assets.”