South Korea’s Financial Services Commission (FSC) has opened consultation on proposals to tighten property lending limits and payment risk controls for specialized credit finance companies while easing restrictions on their rental businesses. Building on the December 2025 property project finance reforms, the proposal would cap lending to the real estate and construction sectors separately at 30% of credit assets. A new combined ceiling of 50% would cover property project finance and lending to both sectors, alongside the existing 30% limit on property project finance loans, including debt guarantees. Card companies would have to assess payment gateway providers when entering into or renewing contracts and quarterly during the contract term. Assessments would cover settlement failures and illegal transactions, including providers’ financial condition, regulatory compliance and external management of settlement funds. Companies would have to act on the findings, potentially declining contracts or renewals or terminating existing agreements. The proposal addresses settlement and transaction risks against a backdrop of broader scrutiny of payment gateways, whose cybersecurity and consumer safeguards the FSC reviewed in September. For rental businesses, the aggregate cap, measured by quarterly average balances, would increase from leasing assets alone to leasing assets plus installment finance assets, with the installment finance contribution capped at the amount of leasing assets. Limits for individual asset categories would be abolished, but entry into the short-term rental market would remain prohibited. Specialized credit finance companies offering rentals also plan to support smaller car rental operators through expanded credit lines, principal repayment deferrals and referrals for temporary replacement vehicles. The FSC plans to complete the amendments by the first quarter of 2027.
South Korea’s Financial Services Commission proposes tighter property lending limits and payment gateway checks alongside relaxed rental business caps
South Korea’s Financial Services Commission is consulting on separate 30% lending caps for real estate and construction, plus a 50% combined ceiling including property project finance. Card companies would assess payment gateways at contract signing, renewal and quarterly, taking action where risks warrant. Rental business caps would be eased while the ban on short-term rentals remains, with amendments targeted for completion by the first quarter of 2027.