Mutual Savings Bank(상호저축은행, "Savings bank") is a category of Korean financial institution.

A Mutual Savings Bank is a financial institution chartered by a state or a local authority to provide a safe place for people to save their hard-earned money and invest that money in loans or mortgages, etc. Also, you can become a member of such banks and earn dividends by subscribing to their common fund. However, in Korea, unlike other countries, you can't become a member of mutual savings banks.

Mutual Savings banks in Korea offer financial services as commercial banks do. Hence, it is okay to call them 'mini-sized commercial banks from the perspective of personal clients. But they're not good at dealing with foreigner customers because most of them don't offer foreign exchange and English services. Also, each savings bank has only a few branches around the country so you might be able to visit only nearby savings banks. If you're a Korean citizen, you can open an account from any savings bank with SB톡톡 application.

Korean people use savings banks for one of two purposes.

The first one is to get a personal loan easily. You can get a larger amount of personal loan from a savings bank, and they offer loans to people with a lower credit score. So if your loan application is rejected from all commercial banks, a savings bank could give you another chance. But you must be informed that they'll charge a huge amount of interest. It will bring a huge impact on your credit score as well.

The second reason is to save their money with higher interest rates on it. They also offer a higher interest rate on their savings accounts, compared to the commercial banks. Since their savings accounts are protected by KDIC, this might be a good option for saving your money.

Although they work like major commercial banks, their legal status is totally different from the commercial banks. For example, the 'separation of industrial and financial capital' does not apply to them.

Their budget is quite small, such that they use the shared banking network and offer the same check card products. If you want to transfer your money into a savings bank account using an ATM or internet banking, you can just choose '상호저축은행' in the bank list or use the KFTC Code 050 or 50 regardless of actual their name.

So are they safe? Can you trust them?". Well, the answer to these questions differs for each savings bank. But overall, it's unsafe as compared with ordinary banks. There were many cases in which savings banks were shut down due to their financial fraud and management problems. Basically, your deposits will be insured by KDIC. But it will take at least 2~3 months if you need to get it back through them and it's limited up to 50 million KRW per institution. So it would be better to save your money in giant savings banks like 'OK Savings Bank', 'Welcome Savings Bank', or savings banks owned by big companies like 'KB Savings Bank', 'Hana Savings Bank', 'SBI Savings Bank' or 'Shinhan Savings Bank'.

About card products of savings banks

Some savings banks offer check cards called "SB check card" and co-branded credit cards from KB card.

One of the unique features of some SB check cards is that they offer more benefits if you have a larger amount of money in your savings account. For example, SB HI check card and SB 톡톡 check card offer cash back benefits on all purchases. Its default cash back rate is 0.3%, but if you save over 5 million KRW in a savings account and maintain it, the cash back rate will be increased to 1%.

To find Korean information about SB check cards, you can find them here.

They have common check card products and we're going to introduce some of them on this page. Some savings banks have their own check card products.