Credit card loans hit all-time high this year

SEOUL, Nov. 20 (Yonhap) — Outstanding credit card loans have risen sharply to reach an all-time high as of end-October amid tight lending regulations by banks and weak domestic demand, data showed Wednesday.

Outstanding loans extended by nine major credit card firms amounted to 42.22 trillion won (US$30.25 billion) as of end-October, the largest amount ever, according to the data from the Credit Finance Association.

The figure had been on a constant increase to reach a record high of 41.83 trillion won as of August before falling to 41.69 trillion won the following month.

The growth came as cash-strapped people turned to card firms to borrow money as banks have raised loan interest rates and tightened lending recently in line with the government’s call for strictly managing loans to curb surging household debts.

“Self-employed people and small businesses, in particular, have suffered difficulties and taken out card loans amid sagging private consumption,” a card firm official said.

Retail sales, a gauge of private spending, shed 0.4 percent from a month before in September. On an on-year basis, retail sales sank 2.2 percent, the seventh straight monthly fall, government data showed.

graceoh@yna.co.kr
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