Shinhan Financial Group to Provide Up to KRW 3 Million to Young People Who Diligently Repay Their Debts

[Financial News] Shinhan Financial Group is launching an inclusive-finance program that will return part of their repayments to young customers who have diligently repaid their loans. The group plans to provide up to KRW 3 million per person to help young people enter society and achieve financial independence.
According to financial industry sources on the 3rd, Shinhan Financial Group is pursuing a program to encourage young people to make diligent repayments by using KRW 20 billion of the KRW 100 billion it contributed to the Microfinance Foundation in March. About 10,000 people are expected to benefit over the course of eight years.
Eligible recipients are customers who took out youth loans, such as the Youth Future Connection and Youth Operating Funds loans, from the Shinhan Microfinance Foundation on or after April 1 and are currently repaying them without delinquency. Delinquency status will be checked at the end of each quarter, and recipients will receive up to KRW 300,000 per payment for a maximum of 10 payments, totaling up to KRW 3 million.
The Youth Future Connection loan is designed for unemployed people aged 19 to 34 and young people within one year of starting employment or a business who are in the bottom 20% of the credit-score range or belong to the lower-income bracket. It covers job-preparation expenses, certification fees, startup costs, and early settlement expenses. The loan carries an annual interest rate of 4.5% and has a maximum limit of KRW 5 million. Rather than considering only an applicant’s current income and financial transaction history, the program comprehensively evaluates the purpose of the funds, employment or business-startup plans, and willingness to repay. The initiative is intended to give another opportunity to young people who may have struggled to receive adequate consideration under conventional, standardized screening by existing financial institutions.
The Shinhan Microfinance Foundation will begin accepting applications on the 4th and plans to start paying the support funds to eligible recipients on October 12.
On March 27, shortly after his reappointment was confirmed, Jin Ok-dong, chairman of Shinhan Financial Group, signed an agreement with the Financial Services Commission (FSC) and the Korea Inclusive Finance Agency to support young people and overcome regional crises. He subsequently decided to make an additional KRW 100 billion contribution to the Shinhan Microfinance Foundation. This was the first decision by any of the 38 microfinance institutions in Korea to make an additional contribution since the Microfinance Foundation was established in 2009. Of that amount, KRW 20 billion will be used for the current youth-support program, while KRW 80 billion will fund low-interest loans for financially vulnerable groups, including young people, low-income households, and small business owners.
Jin Ok-dong, chairman of Shinhan Financial Group, said, "Many young people who receive loans through the Shinhan Microfinance Foundation have difficulty crossing the threshold into the mainstream banking sector." He added, "I wanted to return the efforts of those who continue to repay their loans diligently, rather than letting the support end with the loan, and help them build assets on their own."

[email protected] Seo Ji-yoon Reporter