Economic Crisis: The Rise of High-Interest Card Loans

Ordinary people are increasingly relying on high-interest card loans due to the dire economic situation.

### The Dire State of the Economy and Its Impact on Loans
The economy is in a **severe downturn**, causing ordinary people to struggle and resort to loans for survival. Loan availability has decreased due to regulations, leading to a rise in **high-interest card loans** as the only option for many. The surge in card loans is reminiscent of the **dangerous situation before the IMF crisis** in South Korea, resulting in a **risky cycle of defaults**.

### The Surge in Card Loans and Cash Services
Card loans and cash services are becoming increasingly popular, with a record **44.7 trillion won in loans issued**. The high interest rates for these services, reaching **up to 17%**, are causing financial strain for borrowers. The current economic situation for self-employed individuals and ordinary citizens is **worse than during the 2008 financial crisis and the COVID-19 pandemic**, leading many to resort to these high-interest options.

### The Dilemma of High Interest Rates and Rising Debt
High interest rates are leading people to take out loans, creating a **cycle of borrowing to pay off debt**. The Bank of Korea is in a dilemma, as lowering interest rates could **raise housing prices**, while not lowering them leaves ordinary people in a **risky situation**. Credit card loans and delinquencies are increasing, with projections showing a rise to **44 trillion won by August 2024**, and the overdue amount has **doubled to 1.3 trillion won**, indicating a **worsening financial situation**, particularly for the **next generation**.

### Economic Challenges and Rising Delinquency Rates
Interest rates have been lowered to prevent a recession, but this may lead to **higher housing prices** and a **challenging economic situation**. Credit card delinquency rates have been steadily increasing since 2021, with a current rate of **3.8%**, raising concerns for the financial sector. The high business closure rate among self-employed individuals and the unfavorable economic indicators suggest that **caution is needed** when taking on loans or making significant purchases.

### Promoting Affordable Coffee and Mindful Spending
Filling granaries with food is essential for **getting through the barley season**. The speaker encourages reflecting on both **large and small everyday expenses**. Time Coffee is offering a decaffeinated stick for **200 won per cup**, providing an affordable alternative to **expensive coffee**.

### Economic Crisis: The Surge of Card Loans and Financial Strain
* 📉 The economy is in a dire state, forcing ordinary people to **rely on loans** as money flow has **significantly decreased**.
* 💳 Loan accessibility has tightened, leading many to turn to card loans despite their **high interest rates**, which can **reach up to 17%**.
* 📊 "Currently, card loans and cash services have reached a **historic high of 44 trillion 700 billion won**, indicating a **concerning trend reminiscent of past financial crises**."
* 📈 The delinquency rates are alarming, with overdue amounts projected to reach approximately **1.3 trillion won by August 2024**, doubling from previous years.
* 👥 The next generation, particularly those in their 2030s, is facing **severe financial challenges**, which could lead to a **wave of bankruptcies**.
* ⚖ The Bank of Korea is in a dilemma, needing to **balance interest rates to prevent further economic decline** while avoiding a **spike in housing prices**.
* 💡 In light of these circumstances, individuals are urged to be **cautious with loans and spending**, avoiding unnecessary expenses and focusing on **financial stability**.
* ☕ As a small initiative, affordable options like the **decaffeinated stick at Time Coffee** are promoted to encourage **mindful spending** in everyday life.

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