More than 2.3 million people have applied for the Youth Future Savings account, which offers an interest effect of up to 19.4 percent annually. The Financial Services Commission (FSC) and the Korea Inclusive Finance Agency said Friday that about 2.343 million people applied to enroll during the application period from Nov. 22 to this month's third day.
Of these, about 80,000 applied under small business owner eligibility. By age group, young people aged 30 to 34 accounted for the largest share of applications.
According to the FSC, eligibility screening will take place over three weeks from Friday until the 24th. Screening results will be individually communicated to applicants on the 24th.
Those who pass the screening will be able to open accounts over a two-week period from the 27th to the 7th of next month. After opening an account, holders can freely deposit from 1,000 won to 500,000 won each month.
The Youth Future Savings account is a newly created policy financial product designed to address the shortcomings of the Youth Leap Account. The maturity was shortened to three years from the previous five years, and government contributions were expanded to up to 12 percent from the previous 3 to 6 percent. Adding the 5 percent base interest rate provided by banks and preferential rates of 2 to 3 percent set by each institution, a maximum interest rate of 7 to 8 percent applies.
When government contributions and tax exemptions on interest income are factored in, the actual enrollment effect is similar to signing up for a simple-interest savings product yielding 13.2 to 14.4 percent annually for the general type, and 18.2 to 19.4 percent annually for the preferential type.
Detailed information on enrollment screening and related matters can be checked through the Youth Future Savings webpage or the Korea Inclusive Finance Agency's youth finance call center (1397, then press 3). The second round of Youth Future Savings applications is scheduled to take place around December this year.
