South Korea's Financial Services Commission reviewed preparations to introduce a dedicated credit assessment system for small businesses and sole proprietors, known as SCB, across the banking sector and gather views on related credit infrastructure reforms. The main outcome was an expansion of the pilot from seven banks and KRW 1.8 trillion of loans to 16 banks and KRW 2.2 trillion, with phased rollout from late August 2026 depending on each bank's readiness. The system uses nonfinancial data such as sales, business sector and commercial area information to assess future growth potential, with higher growth scores allowing an uplift from the existing credit bureau rating and better loan terms such as approval, pricing and limits. The commission said SCB will also be incorporated more widely beyond the initial bank pilot. It is preparing to use SCB in dedicated Saetdol loans for individual business owners targeted for launch in October 2026, and in regional credit guarantee foundation guarantee screening and assessment from 2027. Supporting regulatory changes to the supervision rules for credit information businesses and banks' loan underwriting guidelines for individual business owners are due to be completed in August, alongside an SCB operating guideline covering use of SCB in loan screening and staff liability protection when the ratings are used reasonably. The meeting also discussed whether the five-year registration and sharing period for public information on personal bankruptcy and discharge should be shortened, following earlier changes for individual rehabilitation debtors who faithfully performed repayment plans. Views were mixed, with some participants supporting a shorter period to help discharged debtors return to economic activity more quickly, while others urged caution given the legal and economic differences from rehabilitation and the longer retention periods used in many foreign jurisdictions. The commission said it will continue reviewing the issue through further discussions with related bodies and experts.
South Korea Financial Services Commission2026-07-27
South Korea Financial Services Commission expands small business credit scoring pilot to 16 banks, broadening use across KRW 2.2 trillion of lending
South Korea's Financial Services Commission expanded the pilot for its small business credit assessment system to 16 banks and KRW 2.2 trillion of lending, with rollout from late August 2026. The AI-based model uses nonfinancial data to capture growth potential and is set to be extended to individual business owner Saetdol loans from October 2026 and regional credit guarantee assessments from 2027. The commission also began further review of whether to shorten the five-year retention period for public bankruptcy and discharge information.