"Nullity of principal and interest of illegal loan contracts such as collection of evil" passed the plenary session.

An amendment to the Loan Business Act, which strengthens the management and supervision of the loan business and punishment of illegal private finance, passed the National Assembly plenary session.

The amendment stipulated that existing unregistered lenders and brokers are illegal private financial companies and brokers to block illegal private financial crimes targeting ordinary people and vulnerable groups, such as illegal debt collection.

In addition, the equity capital requirements required for loan registration have been raised from more than 10 million won to more than 100 million won.

It also includes grounds for illegal collection of malicious crimes such as sexual exploitation, human trafficking, assault, and intimidation during the loan contract process, or invalidating the principal and interest of illegal loan contracts whose loan interest rate is more than three times the legal maximum interest rate (20% per year).

The amendment will take effect six months after the promulgation.