Korea Federation of Banks and Korea Inclusive Finance Agency to Completely Overhaul Stepping Stone Loan... "Support for Diligent Repayers"

The Korea Federation of Banks and the Korea Inclusive Finance Agency announced on December 24 that they will completely overhaul the support system for the “Stepping Stone Loan,” a bank credit loan product for diligent policy inclusive finance borrowers.

This reform is part of the introduction of the “Credit Build-Up System,” which was reported during the “Financial Services Commission Work Report” on December 19. Through this change, financially vulnerable groups who faithfully repay their policy inclusive finance loans will be able to access bank credit loans more easily.

With this reform, the Korea Inclusive Finance Agency and the banking sector have relaxed the eligibility requirements for the Stepping Stone Loan and simplified the application process. Those who have used policy inclusive finance products diligently for at least two years, or have used them for at least six months and fully repaid the principal and interest within the past three years, and are selected through the “Integrated Credit Evaluation Model for Inclusive Finance,” will be eligible to apply for the Stepping Stone Loan.

Eligible policy inclusive finance products include Workers’ Sunshine Loan, Sunshine Loan Youth, Sunshine Loan Bank, Sunshine Loan 15·17, Special Guarantee for Lowest Credit Borrowers, and Sae Hope Hall Credit Loan. In line with the “Credit Build-Up” initiative, diligent repayers of the newly established “Microfinance Livelihood Fund for Financially Vulnerable Groups,” which will be launched in the first quarter of next year, will also be eligible for support.

To improve convenience, the Korea Inclusive Finance Agency will operate a dedicated “Stepping Stone Loan Platform” within the “Inclusive Finance Connect” application (app), allowing users to check their eligibility in real time, verify which banks offer the loan, and complete the application process in one stop. By applying for Stepping Stone Loan support through the “Inclusive Finance Connect” app, users can instantly verify their eligibility without submitting additional documents, check available banks, and make a preliminary application.

However, specific conditions such as loan limits and interest rates will vary depending on each bank’s internal review. Even if a bank appears as available in the preliminary review results within the “Inclusive Finance Connect” app, the final approval may change depending on credit information updates and the bank’s internal review outcome.

After preparing system integrations and IT developments for the Stepping Stone Loan reform, the banking sector will begin with IBK Industrial Bank of Korea from December 24, and all participating banks are scheduled to complete the rollout by the first quarter of next year.

Cho Yongbyoung, Chairman of the Korea Federation of Banks, stated, “With this reform of the Stepping Stone Loan, we expect that diligent policy inclusive finance borrowers will be able to settle into the banking sector more actively. The banking sector will continue its efforts to ease the financial burden on low-income and vulnerable groups, including through the activation of the Stepping Stone Loan.”

Lee Jaeyeon, President of the Korea Inclusive Finance Agency, said, “This reform of the Stepping Stone Loan is expected to substantially improve financial accessibility for diligent policy inclusive finance borrowers by expanding eligibility and simplifying application procedures. We will continue to enhance our policies to support the financial stability and self-reliance of low-income individuals.”