The Future of Inclusive Finance: Designing Technology and Systems Together

The South Korean stock market is drawing global attention. The KOSPI index has surged sharply since the beginning of the year, surpassing the 8,000 mark for the first time in history, with daily fluctuations reaching double the levels of previous years. While rising corporate values and increased stock investments by citizens are certainly positive developments, they also bring discomfort and anxiety. There is a sense of alienation, as if one is falling behind in a celebration that everyone else is enjoying, and a feeling of futility as daily labor seems diminished. Moreover, the thought that artificial intelligence (AI) could someday replace jobs raises concerns about the stability of salaries.

The foundation of our economy lies in household income and corporate profits. Without this foundation, rising asset prices will eventually deflate like bubbles, exacerbating polarization. The role of inclusive finance and productive finance is to help ensure that household income and corporate profits grow together and that opportunities are opened fairly. Now is a crucial time for this role to be more important than ever.

In this regard, I warmly welcome the government's initiative for a 'transformative shift towards inclusive finance.' In March, the Financial Services Commission announced tailored financial support measures for youth, vulnerable groups, and local communities. In April, it introduced measures to promote mid-interest loans. In May, the 'Inclusive Finance Strategy Promotion Team' was launched, declaring plans to redesign the principles of the financial system, including credit evaluation, fund intermediation, and incentives. The policies are robust and consistent, including the introduction of new loans for self-employed individuals, interest rate reductions for Sunshine Loans, a doubling of microfinance supply, and the provision of 4.3 trillion won for social solidarity economy organizations, along with measures to curb long-term and excessive collections. This approach is significant as it targets structural issues rather than merely providing symptomatic relief.

The online investment-linked finance (OIF) industry was born with the mission of inclusive finance. Over the past decade, it has quietly met the funding needs of low-to-moderate credit borrowers, small business owners, and young entrepreneurs who have been overlooked by traditional financial institutions. During this time, the industry has attracted nearly 500 billion won in venture investments, focusing on developing alternative credit evaluation models and user-friendly automated platforms. After a lengthy period of technological accumulation, it was designated as an innovative financial service in July 2024, and since June 2025, savings banks have participated as investors in OIF, leading to rapid growth in mid-interest loans.

The government has also explicitly recognized the role of OIF. The mid-interest loan promotion plan announced in April includes provisions to grant the same incentives for mandatory ratios and limits on mid-interest loans linked to savings bank OIF investments, aiming to expand the supply of mid-interest loans to 500 billion won this year. Although it took time to get started, the industry was well-prepared, and results are quickly becoming evident. This is being regarded as a model case where market validation and policy support are closely aligned.

For OIF to better realize inclusive finance, institutional support is essential. No matter how excellent a credit evaluation model is developed, if it does not lead to actual funding connections, it remains merely a theoretical validation. This is why the amendment of the Online Investment-Linked Finance Act (OIF Act) is urgently needed this year. Since its passage in the National Assembly in 2019, the OIF Act has not been amended once in seven years. It is imperative to reflect the industry’s experiences and the changing market environment in the regulatory framework. Adjustments to institutional investor regulations, easing self-calculated investment restrictions, and refining investor protection systems must be established to ensure that the government's promise of a 'transformative shift towards inclusive finance' can be fulfilled on the ground.

Looking further ahead, the future of inclusive finance will unfold in a landscape quite different from today. Elon Musk predicts that a universal basic income era will emerge amid the abundance created by AI. As the nature of work and lifestyles fundamentally change, current credit evaluation models will no longer be valid. Existing methods based on regular salaries and real estate ownership do not adequately apply to non-traditional income earners such as gig workers, platform laborers, and small business owners. Research and development on redesigning credit evaluation systems and models must proceed in tandem.

Another crucial aspect is the innovation in financial infrastructure brought about by Web3 and digital assets. Soon, a significant portion of lending and investment will occur across borders within the digital asset ecosystem. We must prepare for this change to ensure that global liquidity flows into our real economy, supporting the production activities of small business owners and SMEs. If we are unprepared, the South Korean economy risks becoming a marginalized area excluded from the liquidity of the digital asset era.

Inclusive finance cannot be realized through technology or systems alone. To ensure that the government's transformative shift towards inclusive finance does not end as a one-time slogan, institutional reforms in related industries such as OIF, redesigning credit evaluation systems, and upgrading infrastructure for the digital asset era must proceed concurrently. In this journey, OIF will play its part as a crucial pillar.