Bank Card Rates Begin to Decline Before Deadline

More commercial banks will be lowering credit card rates to comply with an order by the Fair Trade Commission.

Seoul Bank said Thursday that it would lower rates on credit card cash advances from a maximum of 25 percent to 23.4 percent, effective next Thursday. The bank's new rate on overdue balances will be 3.5 percentage points lower, it said.

Chohung Bank and Hana Bank will also lower card rates applied to cash advances, installment sales and overdue balances, they said.

Industrial Bank of Korea also announced this week that it would lower its rates, effective Friday.

The moves follow an order by the Fair Trade Commission in March for credit card companies to cut rates. The companies have until May 27 to comply.

Chohung will lower rates on cash advances by up to 2.45 percentage points and rates on installment sales by a maximum of 1.5 percentage points, to take effect May 26, it said.

The credit card divisions of Samsung and LG said they are reviewing the range of rate cuts to be made. H&CB and Hanvit Bank also said their rate cuts will be equivalent to those of competitor banks.

By contrast, Kookmin Card and Foreign Exchange Card, which were excluded from the antitrust regulator's order last month, are reportedly not considering changes.

by Choi Hyeon-chul