Seoul: South Korea's household credit growth decelerated in the fourth quarter of 2025 due to stricter lending regulations, although the total outstanding amount hit a new peak, as indicated by central bank data released on Friday. Outstanding household credit amounted to 1,978.8 trillion won (US$1.36 trillion) by the end of December, marking an increase of 14 trillion won from three months prior, based on preliminary data from the Bank of Korea (BOK).

According to Yonhap News Agency, this figure is the highest since the BOK began collecting this data in 2002. It also signifies the seventh consecutive quarterly rise, even though the growth rate decreased for the second successive quarter. Household credit encompasses credit purchases and loans provided to households by financial institutions.

Specifically, household loans totaled 1,852.7 trillion won at the end of December, reflecting an 11.1 percent increase from three months earlier. Within this, mortgage lending grew by 7.3 trillion won to 1,170.7 trillion won, a slowdown from a 12.4 trillion-won rise in the preceding quarter. Credit purchases increased by 2.8 trillion won on a quarterly basis to 126 trillion won, a slight deceleration from a 2.9 trillion-won increase in the third quarter, according to the data.

BOK official Lee Hye-young stated at a press briefing, "As the government has been emphasizing strict management of household lending since the beginning of the year, household debt is unlikely to increase sharply for the time being." The official also noted, "But uncertainties remain high, given the slight increase in housing transactions toward the end of last year and the resumption of lending operations by financial institutions at the start of the year."

The government has enacted several measures to address the overheated housing market and control household debt. Under a comprehensive policy package introduced in October, 21 additional districts in Seoul were designated as speculative zones, subjecting all 25 districts in the capital to stricter regulations. Lending rules were also tightened, reducing the cap on mortgage loans to as low as 200 million won, compared to the 600 million-won limit set in June.

For the entire year of 2025, household credit rose by 56.1 trillion won, or 2.9 percent, from the previous year, marking the fastest growth since 2021, as per the data.