South Korea’s first internet-only lender, K bank, saw a hike in term deposits in January backed by an inflow of new customers, bucking the trend of a money exodus other commercial banks are experiencing.
K bank’s savings stood at 4.5 trillion won ($4.02 billion) at the end of January, adding 750 billion won from the previous month, in a record monthly growth for the company. Another internet-only bank, Kakao Bank, saw an increase of 112 billion won during the same period.
The inflow of deposits comes in contrast to the five commercial banks -- KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup -- which saw a deposit decline of 5.5 trillion won combined, and 670 billion won for recurring saving accounts.
The 5-year-old online-only lender provides an interest rate as high as 1.3 percent for one-year deposits and up to 1.8 percent for one-year installment savings. This compares with other lenders which give less than 1 percent for interest, officials said.
K bank was relaunched in July after an almost 15-month hiatus. The lender has 2.47 million customers, with a record high increase of 280,000 in January.
“It is a combination of our efforts: we resumed housing loans and credit loans and offer attractive interest rates. Partnering up with crypto exchange Upbit also helped,” a K bank official said.