Korean credit card spending up to KRW 540 T in 2011

Increase in card loans pushed South Korea's credit card spending to KRW540 trillion or US$478.5 billion in 2011.

This transpired as local banks cut back on retail lending in line with the government's move to curb snowballing household debts, reports Yonhap News.

Last year's total is the second-largest spending figure, after 619.1 trillion won tallied in 2002, when the country was hit by a credit card bubble.

Borrowing cash from credit card companies is easier than from a bank as the loan evaluation and qualification process is generally simpler.

Experts said last year's card spending increase is directly related to the government's announcement in August to compel banks to limit loans to individuals and households. The move caused people who needed money to turn to other means to borrow money.

 South Korea's total household credit that includes bank loans and credit purchases has been on the rise and stood at 892.5 trillion won or US$773.7 billion as of end-September last year.