The Korea Credit Union Federation has launched a three-year, lump-sum savings mutual-aid product that offers a fixed annual compound rate of 4% if held to maturity, aiming to help customers set aside goal-based funds despite interest-rate swings.
The federation said May 7 it introduced the non-dividend “Shinhyup 4U Savings Mutual Aid.” Customers pay the contribution once at enrollment and receive the fixed 4% annual compound rate if they keep the contract through the three-year term. Savings mutual aid is a savings-type mutual-aid product in which members pay set amounts and receive a payout at maturity, similar to insurers’ savings policies.
For example, a 55-year-old man who pays a one-time contribution of 50 million won would receive 54,718,000 won before taxes at maturity after three years, for an expected refund rate of 109.4%.
The product also includes coverage. If the policyholder dies, the death benefit is paid as 3% of the basic lump-sum contribution plus the accumulated contract balance at the time of death. Customers may make up to 12 midterm withdrawals a year, up to 50% of the surrender value.
Customers can convert the maturity payout into an annuity through the “Non-dividend Annuity Conversion Rider II.” Eligible ages range from 15 to 80, with a minimum lump-sum contribution of 1 million won. The federation cautioned that surrendering early could result in a payout below the amount paid in.
Separately, Chairman Ko Young-cheol and Son Seong-eun, the federation’s executive in charge of credit and mutual-aid business, signed up as the first and second customers at Hanwoori Credit Union on May 7 to mark the launch. “Even as volatility in financial markets increases, the purpose of this product is to help customers build goal-based funds in a stable way and prepare for retirement planning,” Ko said. “We will continue to introduce products that raise practical financial benefits for members and customers.”
* This article has been translated by AI.
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