Household Debt Nears W1,000 Trillion

The amount of household debt in Korea has swelled close to W1,000 trillion (US$1=W1,063).

According to data released by the Bank of Korea on Friday, third-quarter household debt stood at W991.7 trillion. It has grown by around W20 trillion every fourth quarter as real estate transactions and car purchases rise. Also, more people have recently taken out loans due to government attempts to stimulate the housing market with tax cuts and other support.

These factors are leading economists to predict total household debt will exceed W1,000 trillion before the end of this year.

Household loans from banks and other financial institutions increased W11.6 trillion, while credit-card purchases and installment payment obligations rose by W500 billion.

But household debt increased at a slower pace than in the previous quarter, when it rose W17.1 trillion. The main reason behind the drop is a decline in purchases of homes after tax cuts for new home buyers ended in June.

Read this article in Korean