Loans to Active-Duty Soldiers from Illegal Lenders Surge to 24.2 Billion Won in Three Years

The amount that active-duty soldiers borrowed from moneylenders (non-bank lenders charging high interest) while serving in the military has surged from 350 million won to 24.2 billion won over the past three years. According to the Financial Supervisory Service on the 15th, the value of loans extended to active-duty soldiers by the top 30 registered moneylenders under the Financial Services Commission grew from 350 million won at the end of 2022 to 24.2 billion won at the end of 2025. The FSS analyzed that reckless handling of funds during high-risk investments such as online gambling and virtual assets was one of the main drivers behind the rising debt.

In response, financial authorities, seeing a growing number of soldiers incurring excessive debt through high-risk investments such as online gambling and virtual assets, have decided to impose the same restrictions on general credit loans to active-duty soldiers in the moneylending sector as those applied by banks and savings banks. The restriction will be incorporated into the standard business practices guide of the Korea Money Lending Finance Association and operated as industry self-regulation.

Secured loans and small emergency loans will remain under the current standards to meet urgent needs such as family living expenses and medical costs. Banks and savings banks—secondary financial institutions—can offer emergency loans of up to 3 million won to active-duty soldiers, while the moneylending sector can provide emergency loans of up to 1 million won to borrowers aged 29 or younger.

Financial education targeting military personnel will also be strengthened. The FSS plans to expand one-on-one financial counseling, step up preventive education on gambling and debt-fueled investing, and increase promotion of policy financial products available to active-duty soldiers.