South Korean households are struggling with mounting debt, with the number of financially-distressed borrowers increasing sharply.

According to data obtained by Representative Park Sung-hoon of the ruling People Power Party from the Bank of Korea on Monday, the loan amount for those under 30 reached 496.3 trillion won ($368.75) in the second quarter of 2024, up 24.9 percent from five years ago.

The increase was the second highest among all age groups, after those above 60 (29.5 percent).

“As the pandemic has led to an employment crisis, more people in their 20s and 30s are taking out loans to make ends meet,” said Kang Sung-jin, an economics professor at Korea University.

“As loan delinquency rates rise, the accumulated pressure is likely to persist for an extended period,” he added.

An analysis of data from the central bank and the Bank for International Settlements (BIS) also showed that the debt of small business owners increased by 76.2 percent over the past five years to 365.4 trillion won as of the end of the first quarter.

Jeonse or long-term rent deposits also jumped 37.7 percent in five years to 1,006.7 trillion won in 2023, according to estimates by Maeil Business Newspaper and the Federation of Korean Industries.

Jeonse deposits are debts that landlords owe tenants and must return when the lease ends. They are not included in official household debt statistics because they are private financial transactions.

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