Kiwoom Securities offers 4.0% interest rate on promissory notes to mark pension launch

By Jung Yoon-hee, The Herald Business

Kiwoom Securities announced Tuesday it will hold a special sale of one-year fixed-term promissory notes for individual customers to mark the launch of its pension business.

Through the promotion, individual customers can temporarily subscribe to the one-year fixed-term product at a preferential pre-tax annual interest rate of 4.0%, up from the standard rate of 3.6%.

Total sales are capped at 100 billion won ($64.8 million), and the event may end early if the limit is reached. Customers who redeem early will receive 30% of the contracted rate if they hold the product for between one and 90 days, or 50% of the contracted rate if they hold it for more than 90 days.

Kiwoom Securities has offered a range of interest rate products — including on-demand and fixed-term options — since launching its promissory note business in December last year. Its on-demand product, available for terms of one to 365 days, carries a pre-tax annual rate of 2.7% and has attracted customers looking to park investment funds or put short-term idle cash to work.

The firm officially entered the pension market on June 1, becoming the 47th pension service provider in the country. Leveraging its non-face-to-face online platform, it aims to capture a 10% share of the pension market and rank fifth in the industry by accumulated reserves by 2035.

With the pension launch broadening its reach among individual customers, Kiwoom Securities plans to sharpen the competitiveness of its existing interest rate products and respond more actively to customer demand for fund management. The firm intends to address short-term cash management needs through its on-demand product while using the current one-year fixed-term promotion to offer more competitive financial products.

"This special sale is an event to temporarily offer a preferential interest rate on our existing one-year fixed-term product to mark the launch of our pension business," a Kiwoom Securities official said. "We will continue to meet customers' fund management needs through competitive financial products."