South Korea Activates Pension Collateral Loan System to Prevent Early Withdrawal by 60,000 Houseless Residents

According to South Korean financial authorities on July 12, the government is activating a collateral loan system for retirement pensions to prevent early withdrawals by approximately 60,000 apartment-seeking residents. Currently, 82% of early pension withdrawals are by houseless individuals seeking to purchase homes or secure deposit funds for leases.

Data from the National Data Platform shows that early withdrawals are primarily for home purchases (56.5%), lease deposits (25.5%), and personal bankruptcy proceedings (13.1%). Early pension withdrawals typically result in significantly lower retirement income: annuity recipients average 148.91 million Korean won, while lump-sum withdrawals average only 18.33 million won.