Health ministry boosts Silver Loan budget by 8.5 billion won to keep lending through year-end

The health ministry said Tuesday it will add 8.5 billion won ($6.38 million) to a state-backed emergency loan program for older pension recipients after the National Pension Fund Management Committee approved the increase, ensuring the scheme runs without interruption through the end of the year.

The budget for the program, known as the Silver Loan, will rise to 62.5 billion won ($46.9 million) from 54 billion won ($40.5 million). The committee, chaired by Health Minister Jung Eun-kyung, made the decision at its seventh meeting of 2026.

The Silver Loan offers emergency living funds to pension recipients aged 60 and older, covering rental deposits, medical bills, funeral costs for a spouse and disaster recovery. Borrowers may take out up to twice their annual pension payout, capped at 10 million won ($7,507) in actual expenses. The interest rate for the fourth quarter of 2026 is 3.21 percent a year, with a 6.42 percent annual rate on overdue payments. Since the program began in 2012, it had lent 630 billion won ($473 million) to 115,446 people through July, and 498 billion won ($374 million), or 99.3 percent of the 502 billion won ($377 million) that has fallen due, has been repaid.

The committee also approved a revision to the fund's proxy-voting guidelines that incorporates changes to the Commercial Act. Under the new rules, the National Pension Service will vote in favor of share buyback plans put to shareholders' meetings when they are consistent with the purpose disclosed at the time of acquisition and are specific and reasonable enough to support long-term shareholder value. The fund will apply the same test to proposed articles of association that set out exceptions allowing a company to hold or dispose of its own shares to meet business objectives.

The committee received a report on detailed follow-up measures for a monitoring system for trustee responsibility activities, which it approved at its sixth meeting, and discussed procedures and criteria for assessing the stewardship work of the National Pension Service and domestic equity managers.