Household debt growth caps should apply only to housing-related loans so that young adults and vulnerable borrowers are not shut out of the financial system, a researcher argued.
Lee Sung-bok, a senior research fellow at the Korea Capital Market Institute, said policies aimed at curbing lending and those aimed at expanding inclusive finance are competing for the same limited supply of credit. He spoke at the 2026 Capital Future Vision Forum, hosted by the Korea Credit Card Association on the 19th at the Bank Hall in Seoul's Jung district.
"A bold decision is needed to limit the scope of the volume caps to housing-related loans," Lee said. "There are young adults who need funds even though they do not fall in the bottom 50% of credit scores, and there are also vulnerable borrowers who could lower their interest burden by using collateral."
Suh Ji-yong, a professor at Sangmyung University who also chairs the Korea Credit Card Association, proposed introducing a "second look" program that would give rejected loan applicants another round of review. "Repayment capacity should be reassessed using account cash flows and recurring income or sales," he said. "Borrowers who have run into trouble because of falling income or sales need support before they fall behind on payments."
Lee Dong-chul, chairman of the Korea Credit Finance Association, which is a separate body from the Korea Credit Card Association, said the capital finance industry is playing a growing role in supporting industrial growth and widening access to financial services. He stressed the need to update regulations in line with changes in the industry.