According to financial sector sources on Sunday, a total of 1.9 million people have opened the Youth Hope installment savings account for five days since February 21, when the savings scheme was launched. The total number of applicants across all banks is likely to reach around 2 million. This number is more than five times higher than the government’s initial estimate (380,000).
As demands for savings have grown, criticism is mounting of the government failing to forecast demand accurately, while controversy continues to escalate over the fairness of the policy. Only people between the ages of 19 and 34 who earned 36 million won (26 million won net income) or less last year are eligible to open a Youth Hope Installment Savings Account.
Thus, job seekers who have no income and those who landed their first job last year and who therefore cannot prove their income do not have the right to open the account. On the contrary, foreigners who earn taxable income while residing in Korea for 183 days or more are allowed to open the account if they meet the requirements.
With this in mind, some young Koreans have urged the government to “expand the scope of beneficiaries to other Korean citizens instead of foreigners,” while others wonder, “Does the government have the enough taxpayers’ money to support even foreigners? Someone indeed posted a critical comment on the policy giving more preferential benefits to foreigners on the presidential office website on Thursday. “Korea should generously give money to young foreigners with my taxpayers’ money. Young people who have actually paid taxes are not allowed to get the support,” said the person who identified himself as a 34-year-old office worker. The comment won consent from 10,600 netizens on Sunday.
“Most foreigners are allowed to open most tax-exempt savings plans under the ‘Special Tax Advantage Restriction Act’, including the special housing purchase deposit for young people”, said a government official. The government is considering a plan to give young people who got their first job last year a chance to open the Youth Hope Installment Savings Account from July.