SEJONG, Oct. 31 (Korea Bizwire) – The number of college graduates who failed to pay back their student loans jumped nearly eight times in three years, data showed Monday, in the latest sign of financial trouble for young South Korean workers.
Under the student loan program that began 2010, college graduates are required to pay back their loans in case they earn more than 18.56 million won (US$16,000) a year.
Last year, a total of 86,715 college graduates were obliged to start paying back their loans.
Among them, 7,912 college graduates defaulted on those loans last year, compared with 1,104 people in 2012, according to data compiled by the National Tax Service.
Last year, outstanding student loan debt stood at 6.55 billion won.
The development underscores difficulties facing college graduates in paying back their loans even if they get jobs.
The number of those unemployed with a bachelor’s degree reached 315,000 as of end-September, accounting for a record 32 percent of the entire jobless population of 985,000, according to data by Statistics Korea.
It marked the first time that the figure topped the 300,000 mark since 1999, when the statistics office started to compile such data.
More than 70 percent of high school graduates went on to university in 2014, the highest college attendance rate among members of the Organization for Economic Cooperation and Development, a group of 34 mostly rich nations.