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FSC to rate borrowers on scale of 1 to 1,000

Jan 31,2018
The Financial Services Commission will overhaul its credit rating system to provide more precise measurement of borrowers’ credibility.

The regulator said Tuesday that the new system will rate borrowers on a scale of 1 to 1,000, a departure from the current scale of 1 to 10.

With the change, the FSC expects that some 2.4 million borrowers will see their interest rates go down by 1 percentage point on average.

Since the current system can clump 3 to 10 million people into one group despite varying levels of credibility, critics say some borrowers go through unfair assessments when they apply for a loan.

The new system will be implemented in the second half of this year, the FSC said.

By Park Eun-jee