List of bad credit risks includes 855 teens

Among teenagers who have been working for less than a year or who have not yet joined the workforce, 855 were listed as bad credit risks in a recent study. The number did not include middle and high school students who failed to pay their cell phone bills.

Among people in their 20s, 255,775 were judged as uncreditworthy, meaning that they would be blocked from having dealings with banks.

Data provided by the Korea Federation of Banks and analyzed by Korea Management Consulting and Credit Rating Corporation (KMCC) on Sunday put the number of overall credit delinquents at 2,429,857 nationwide as of Mar. 7. The largest number (829,398) were found to be in their 40s, followed by those in their 30s (735,888) and those in their 50s (354,577). Most of the 253,336 people in their 60s with bad credit ratings were retired.

Most of those in their teens and 20s with bad credit ratings were blamed for free spending on credit cards. Only a few of them received loans or were on installment financing to pay for their schooling.

Korean law provides that only income-earners and those 18 years of age or older are eligible to obtain credit cards, but the stipulation is rather loose and not effectively applied. By far the largest numbers of credit cards are issued to girls in their late teens who are fresh from high school and working at their first jobs, said an official of a credit card company. He added they are neither mature nor knowledgeable enough to control their desire to make impulse purchases.

Sung Dong-Ki esprit@donga.com