Three Internet Banks Surpass 30% Share in Mid- and Low-Credit Loans, Pledge to Strengthen Lending
Based on New Loans: KakaoBank 45.6%, Toss Bank 34.5%, K Bank 33.6%
Inclusive Finance Expands Through Advanced Credit Evaluation Models
The three internet banks—KakaoBank, K Bank, and Toss Bank—surpassed a 30% share of mid- and low-credit loans in the first quarter of this year as well. Each bank plans to strengthen lending to mid- and low-credit borrowers, as well as small business owners, by advancing their credit evaluation models based on non-financial data and expanding policy finance initiatives.
According to the Korea Federation of Banks and the three internet banks on May 22, the proportion of new unsecured loans to mid- and low-credit borrowers in the first quarter was 45.6% for KakaoBank, 34.5% for Toss Bank, and 33.6% for K Bank. Based on the three-month average balance, Toss Bank recorded 34.7%, KakaoBank 32.3%, and K Bank 31.9%.
The three internet banks intend to gradually expand their mid- and low-credit loan portfolios by advancing their credit evaluation models. KakaoBank provided KRW 450 billion in unsecured loans to mid- and low-credit borrowers in the first quarter of this year. Since its launch, KakaoBank’s cumulative mid- and low-credit lending has reached approximately KRW 16 trillion. The bank stated that, by refining its data-based credit evaluation models, the share of new loans to mid- and low-credit borrowers this year exceeded 45%.
Since its launch, Toss Bank has supplied unsecured loans to a cumulative total of 358,484 mid- and low-credit borrowers. The bank explained that in the first quarter of this year, 35% of mid- and low-credit borrowers received additional points through its proprietary alternative credit evaluation model. Among them, 72% of borrowers under the age of 35 benefited from these additional points, contributing to the discovery of young people previously excluded from the credit system.
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Since its launch, K Bank’s cumulative supply of unsecured loans to mid- and low-credit borrowers reached KRW 8.66 trillion as of the first quarter. In addition, K Bank supplied KRW 245 billion in private sector mid-rate loans in the first quarter, the highest among internet banks. A K Bank representative stated, “Our continued efforts to expand financial support for mid- and low-credit borrowers and individual business owners have led to tangible improvements in credit quality. We will further strengthen our role in inclusive finance by advancing our credit scoring system (CSS) and expanding tailored products going forward.”
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