To borrow money, Koreans go online

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To borrow money, Koreans go online

Published: 05 Apr. 2021, 16:38

A loan department at KB Kookmin Bank in Seoul in January 2021. [YONHAP]

Koreans are increasingly turning to online banking -- even to borrow money.

The number of loan applications made online, including on mobile banking apps, increased 39.4 percent last year, from 15,000 per day in 2019 to 21,000 last year, according to data from the Bank of Korea on Monday.

Compared to 10,000 daily in 2017, the number of loan applications online has more than doubled.

The amounts applied for jumped 151.5 percent from 192.5 billion won ($170.7 million) per day in 2019 to 484.2 billion won last year. In 2017, the amount was 103 billion won per day.

Banks have been actively promoting the ease of borrowing online and the coronavirus has discouraged people away from face-to-face interactions, even to borrow money. The emergence of internet-only banks has hastened the trend.

The number of internet banking users -- those subscribing to internet banking services offered by 18 local banks and the Korea Post -- has gradually increased from 135 million in 2017 to 170 million in 2020.

As internet banking grows, fewer people are visiting brick-and-mortar bank branches or using automatic teller machines (ATMs) for simple banking services like deposits, withdrawals and transfers.

Internet banking accounted for 65.8 percent of those three basic transactions in 2020, data from the central bank showed. Visiting offline branches accounted for a mere 7.3 percent and using ATMs 21.6 percent.

In 2017, internet banking accounted for 45.4 percent, ATMs 34.7 percent and offline branch visits 10 percent.

BY KIM JEE-HEE [[email protected]]