April 19, 2024

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[THE INVESTOR] Korean credit card firms saw their card loans soar nearly 17 percent on-year in the first half of the year as tougher bank loan screenings forced borrowers to resort to them, industry data showed on Sept. 11.

The country’s seven stand-alone card firms -- Shinhan, KB Kookmin, Woori, Hana, Samsung, Hyundai and Lotte -- extended 20.85 trillion won (US$18.50 billion) in the January-March period, up 16.7 percent from a year earlier.

The figure marks a sharp increase from the 2.8 percent on-year gain recorded during the same period a year earlier.

All of the seven credit card companies posted on-year increases in card loans during the six-month period, with Woori Card posting the biggest rise of 28 percent.

Hyundai came next with 23.6 percent, followed by Hana with 20.3 percent and Samsung with 19.5 percent. KB Kookmin was the sole credit issuer to register a single-digit growth rate with 5.5 percent.

Market watchers attributed the sharp first-half increase to local banks’ stricter loan screenings in line with the government’s push to rein in soaring apartment prices.

Also responsible were credit card issuers’ efforts to jack up card loans to offset falling income due to a government decision to cut credit card fees for small merchants, they said.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)