Hana Bank said on Thursday it has launched a small credit loan product, the Pension Living Expense Loan, to support customers receiving public pensions during temporary cash shortfalls.

The Pension Living Expense Loan targets recipients of four major public pensions: the National Pension, Government Employees Pension, Private School Teachers Pension and Military Pension. It was designed to meet demand among older people for small living expenses and to improve access to financial services.

The product has a single limit of 500,000 won and can be used without a separate, complex limit calculation. It applies a fixed annual interest rate of 1.0 percent, and the loan term is 3 years. It operates as an overdraft-style account that can be used as needed to cover unexpected expenses such as utility bills and hospital fees.

Repayment is structured to be linked to the pension-receiving account, and it also considered financial consumer protection, including reducing inflows into high-interest loans. People scheduled to begin receiving a pension can also use the loan from the start of pension payments after advance consultation and screening.

Chief Executive Ho-sung Lee said, "Demand for small living-expense funds among pension recipients is increasing." He added, "We will continue to provide tailored financial products and services so that customers with low access to financial services are not exposed to high-interest loans."