IBK launches flat-rate loan for low-credit borrowers at 4.9%

Industrial Bank of Korea said Friday it has launched the "IBK Chakhan Geumri Inclusive Loan," a lending product that applies a flat annual interest rate of 4.9% to low- and mid-credit borrowers.

The bank has set aside 1 trillion won ($694 million) for the program, targeting borrowers whose personal credit scores fall in the bottom 50%.

Customers aged 34 or younger receive a preferential rate reduction of 0.2 percentage points, bringing their rate down to 4.7% per year. Individual loans are capped at 20 million won and must be repaid in installments within 10 years.

Financial authorities had earlier announced the product at a policy briefing at Cheong Wa Dae in mid-July, framing it as part of the government's inclusive finance initiative.

"This product was designed to meaningfully ease the interest and repayment burden on low- and mid-credit customers who genuinely need access to finance," a bank official said. "We will continue to expand inclusive finance efforts that improve customers' access to financial services and reduce their cost burden."