9 Out of 10 New "Sajangnim Real Estate Secured Loan" Customers in May Received Annual Interest Rates of 3% or Lower
Average Annual Interest Savings of 480,000 KRW Per Customer
2 Out of 3 Loans Executed Within 5 Days of Application
K Bank's real estate loan product for individual business owners, "Sajangnim Real Estate Secured Loan," has surpassed a cumulative transaction amount of 300 billion KRW just one year after its launch.
On July 3, K Bank announced that its real estate secured loan product for individual business owners, "Sajangnim Real Estate Secured Loan," is marking its first anniversary.
Launched in July last year, "Sajangnim Real Estate Secured Loan" is designed to provide operating funds to individual business owners who possess a business registration certificate. For new loans, the maximum limit per case is 500 million KRW, while refinancing existing operating fund loans allows for a maximum of 1 billion KRW per case. The maximum limit per customer is 1 billion KRW.
The key strength of "Sajangnim Real Estate Secured Loan" is that it offers one of the industry’s lowest interest rates and can be conveniently accessed non-face-to-face. Based on these advantages, the product has provided substantial financial benefits to small business owners and self-employed customers in financial blind spots, surpassing a cumulative transaction amount of 300 billion KRW in just over a year since its launch.
In particular, the interest rate is the most significant advantage. According to new loans issued in May, 46% of customers received loans at an annual interest rate in the 2% range, and 44% received loans at an annual rate in the 3% range. This means that 9 out of 10 customers secured funding at an annual interest rate of 3% or less.
The low interest rates have translated into reduced interest burdens for self-employed individuals. According to the Korea Federation of Banks, as of May, K Bank’s average interest rate for secured loans was 3.7% per annum, which is 0.73 percentage points lower than the average of 4.43% per annum among four major commercial banks. K Bank’s internal analysis found that customers of the "Sajangnim Real Estate Secured Loan" are saving approximately 480,000 KRW in annual interest per person on average.
With the launch of "Sajangnim Real Estate Secured Loan," self-employed customers at K Bank can now receive loans without long waiting times. Two out of three customers had their loans executed within five days of application, and nine out of ten within ten days.
Of the 300 billion KRW in total transactions, 47% was executed in livelihood-based sectors such as wholesale and retail, accommodation, and food services. By customer age group, those in their 40s accounted for the highest proportion at 50%, followed by those in their 50s (30%) and those in their 30s (13%).
K Bank is working to further advance the "Sajangnim Real Estate Secured Loan" by introducing an Automated Valuation Model (AVM), including small-scale apartments with fewer than 50 units such as single-building apartments as eligible collateral, and expanding the scope of collateral to include non-residential real estate such as commercial properties.
A K Bank representative stated, "With our simple non-face-to-face application process and competitive interest rate structure, we aim to be a reliable financial partner for our Sajangnim customers," adding, "We will continue to develop our products to meet the diverse needs of Sajangnim customers in the future."
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