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Finance
Small business credit scores to factor in sales, trading areas; 16 banks to apply 2.2 trillion won
A new credit scoring system for small business loan screening will start operating from late August, evaluating future growth potential using data such as sales, local trading areas, employment and online activity in addition to the owner’s past financial history. The scope will expand from 7 banks and 1.8 trillion won to 16 banks and 2.2 trillion won. Authorities also plan to use the model for a dedicated loan product and future guarantee reviews.
Finance
Mid-rate livelihood stability loan launched for mid-to-low credit borrowers, up to 10 million won
South Korea has launched a mid-rate livelihood stability loan for mid-to-low credit borrowers in the bottom 50 percent of credit scores. The unsecured loan allows up to 10 million won per borrower across all financial institutions. Initial providers include six savings banks. Interest rates range from 5.9 percent to 15.27 percent, depending on borrowers’ credit profiles and lenders’ systems. Borrowers must agree not to buy a home for 1 year or until full repayment.
Finance
Toss launches credit loan for sole proprietors with IBK Savings Bank
Viva Republica, operator of Toss, said on Monday it will launch a credit loan for sole proprietors with IBK Savings Bank using Toss Soho Score. The companies signed a memorandum of understanding to cooperate on advancing data-based credit assessment for sole proprietors. The new loan applies the Soho Score model, developed with Korea Credit Data, to an external financial institution for the first time, combining it with IBK Savings Bank’s existing credit scoring system.