Prime Borrowers' Non-Bank Loans Up Before DSR Tightening

Significant changes are being detected in the domestic loan market ahead of the introduction of the 3rd phase stress DSR (Debt Service Ratio) in July. Particularly noteworthy is the unusual phenomenon of high-credit borrowers, who previously preferred primary financial institutions, turning their attention to secondary financial institutions. According to a recent analysis by fintech company Finda, the number of loan agreements from secondary financial institutions by high-credit borrowers with credit scores of 900 or higher surged by 40.4% in just one week after the announcement of the 3rd phase stress DSR implementation plan. For users with a perfect credit score of 1000, secondary financial institution loan agreements increased by 150%, and the agreement amount soared by 600%, showing an extreme concentration. This is analyzed as a result of many banks proactively responding to the strengthening of DSR regulations by raising their loan thresholds. Consequently, high-credit borrowers strategically moved to secondary financial institutions where they could secure relatively higher loan limits. Notably, the increase rates for high-credit borrower loan agreements and limit inquiries were prominent in the insurance and credit card sectors. In contrast, medium-to-low credit borrowers with credit scores ranging from 400 to 700 focused on primary financial institution loans, showing increases of 5.8% in the number of agreements and 12.8% in the agreement amount, respectively. Finda interpreted this phenomenon as consumers moving beyond the stereotype of simply taking out loans that match their credit scores, and instead seeking out loans with more favorable conditions through personalized strategies. Going forward, once the 3rd phase stress DSR is fully implemented, the importance of 'loan limits' is expected to be highlighted in the loan market, just as much as 'interest rates'. Financial consumers are entering a period where they must make more strategic and wise loan decisions by comprehensively considering their DSR capacity and required loan limits, rather than simply chasing low interest rates. Fintech companies like Finda are expected to play a key role in assisting these decisions by providing DSR calculators and AI loan prediction services. Thus, the loan market appears set to become more diversified as regulatory changes and consumers' strategic judgments interact in complex ways.