President Yoon Suk Yeol said Thursday the government will ease the loans criteria for young families as part of efforts to boost the country’s dismally low birthrate.
Under the plan, the government will raise the threshold for home purchase and rental loans for a newly married couple with a newborn child from a combined income of 130 million won (US$96,400) or less to a combined 200 million won or less, making more families eligible.
The government will also raise the threshold for a newlywed couple’s “jeonse” loan from a combined annual income of 75 million won to 100 million won — twice the 50 million won limit for a single individual — and the threshold for a grant for low-income double-income families from a combined annual income of 38 million won to 44 million won — twice the 22 million won limit for a single individual.
Jeonse refers to a unique Korean system in which tenants give landlords a large returnable deposit instead of paying monthly rent.
“It has become commonplace for people to postpo
ne their marriage registrations in order to take out a loan,” Yoon said during a government meeting reviewing the implementation of policies discussed during a total of 24 government-public debates on people’s livelihood issues since the start of the year.
“Recently, young people pointed out the criteria for some of the government’s assistance projects were in fact acting as a penalty for getting married for newlywed couples,” he added. “We will change this completely.”
South Korea has seen a growing trend of young people forgoing marriage or having children amid changing social norms and high costs of living.
Last year, the number of babies born in the country dropped 7.7 percent on-year to an all-time low of 229,970.
The total fertility rate, or the average number of children a woman is expected to have in her lifetime, also hit a record yearly low of 0.72, far below the 2.1 needed to maintain a stable population.
Source: Yonhap News Agency