A sign at a Seoul bank advertising low interest rates for households and individuals. (Yonhap)
SEOUL, Sept. 23 (Korea Bizwire) — The use of non-face-to-face bank loans that can be applied for simply through several clicks online is on a steady rise.
The outstanding balance of non-face-to-face loans at the nation’s 18 commercial banks as of the end of June 2021 totaled 111.8 trillion won (US$94.4 billion), an almost threefold increase from 39.4 trillion won in late 2017, according to the data released by Rep. Min Hyung-bae of the ruling Democratic Party compiled by the Financial Supervisory Service.
The outstanding balance of non-face-to-face loans has been on an upward trend, rising from 49.3 trillion won in late 2018 to 67.1 trillion won in late 2019 and 99.4 trillion won in late 2020.
During the same period, the number of such loans shot up by about 220 percent from about 1.8 million cases to about 5.8 million cases.
Among the nation’s 18 commercial banks, internet-only bank Kakao Bank ranked first in terms of the balance of non-face-to-face loans at 23.1 trillion won.
The biggest weapon of non-face-to-face loans is simplicity. Customers can borrow money online without having to visit a bank branch.
Amid the COVID-19 pandemic, customers are increasingly showing preference for non-face-to-face transactions. In addition, interest rates on non-face-to-face loans are lower than on face-to-face loans due to competition among banks.
J. S. Shin (js_shin@koreabizwire.com)
