Financial Social Mix

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Good morning all : )

 As new things pop up, there are ‘trends’ from time to time. Those trends are represented by iconic features in fashion, music, food, technology, and so on. Even though it should not be regarded as a mere flow of trend, there is a ‘common theme’ of the time shared by policy makers. And the common theme is usually reflected in policy measures. ‘Social mix’ is what is being discussed a lot these days, as an idea of ‘balanced societies’. It seeks to create communities with a blend of people across different housing tenures and income levels.

 Korea, since 2004, has been implementing this idea of social mix. For example, when building apartments, it is mandatory that a certain proportion of the construction should include small-sized apartments which can be leased to low-income households. With an increasing perception of the importance of social mix, it is said that it is time to implement ‘financial social mix’. This idea is consistent with the Chairman of FSC, Mr. Kim Seok-Dong’s saying. He mentioned that, “The major financial holding companies should pursue not only profits but also a better community. This can be done by those companies’ contributions and efforts to maintain and balance our society.”

 Then what would be such efforts and contributions? Financial industries can design and make financial products which can help stabilize the lives of low-income households. Examples? A financial product encouraging more domestic savings and an insurance system with a reasonable monthly payment.

These kinds of financial products will help low-income households improve their financial capabilities. There are already some products available, such as ‘Seoul Hope Plus Account’ and ‘Insurance for My kids’. Seoul Hope Plus Account offers financial assistance for low-income households’ start-up businesses, residence, and education. Insurance for My kids provides medical expenses in case of serious diseases suffered by low-income households’ children. These products are popular among low-income households, receiving positive feedbacks. It is expected that more of financial social mix products will synergize FSC’s policy measures for low-income households and microcredit system. This is a step towards more stable and vigorous society. 

Cheers,
Frank

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