Chasing a bit more interest with a savings-bank special-rate deposit in Korea, the same worry surfaces: “what if it goes under?” The usual answer is “you're covered to ₩100 million, so just split it ₩100 million at a time.” This article answers three questions — exactly how much fits at one institution, what falls outside protection, and what to check before signing.
1. The principal that fits at one institution is not ₩100 million. The cap covers “principal and stipulated interest combined,” so at 3.5% a year the ceiling is ₩96.62 million. The higher the rate, the lower that ceiling goes.
2. Three things fall outside. Subordinated bonds (a bond, not a deposit), deposits where you also hold a loan (the balance after set-off is what counts), and institutions outside the deposit insurer's remit (mutual finance and the post office run under different statutes).
3. Three checks are enough before you sign. Is it a deposit or a bond / do you hold a loan there / do you already have money there.
Each of the three, worked through below.
For the after-tax proceeds of a high-rate product → compare by rate in the deposit and savings maturity calculator.
How much fits at one institution — less as the rate rises
The first line of the Korea Deposit Insurance Corporation's coverage page reads: “only up to ₩100 million per person, principal and stipulated interest combined, is protected; any excess is not.” Because the test is principal plus interest rather than principal alone, putting in ₩100 million of principal pushes all of the interest outside protection.
So the number you actually need is “how much principal brings the maturity value to exactly ₩100 million.”
| Contract rate | Principal reaching ₩100m with interest | On ₩100m of principal |
|---|---|---|
| 3.0% a year | ₩97,087,379 | ₩3,000,000 of interest unprotected |
| 3.5% a year | ₩96,618,357 | ₩3,500,000 unprotected |
| 4.0% a year | ₩96,153,846 | ₩4,000,000 unprotected |
| 4.5% a year | ₩95,693,780 | ₩4,500,000 unprotected |
| One-year simple interest before tax, calculated by us. The harder you chase special rates, the lower your principal ceiling goes. | ||
Which also breaks “₩300 million means three institutions.” At 3.5% the ceiling is ₩96.62 million each, so three take ₩289.86 million — leaving ₩10.14 million and a need for a fourth institution (our calculation). Splitting ₩300 million four ways at ₩75 million each is simpler.
This calculation is on the conservative side. “Stipulated interest” in the source text is the lesser of the contract interest and the rate the Corporation determines, so protected interest can come in below the contract figure. That would leave more room for principal, but the figure is only set once a failure happens. The only number you can plan around in advance is the contract rate, so that is what we used.
The unit of application also trips people. The source says the cap is “not a limit per product type or per branch, but the total amount one depositor can have protected within the same financial institution,” and it counts foreign currency deposits inside the same ₩100 million. Spreading accounts across branches of the same bank changes nothing.
A deposit where you also owe money is counted differently
One sentence in the source: “where the depositor has a loan with that institution, the loan is first repaid out of the deposit (set-off) and protection applies to the remaining deposit.”
| Situation | The usual arithmetic | As the source has it |
|---|---|---|
| ₩80m on deposit only | ₩80m protected | ₩80m protected (the same) |
| ₩80m on deposit + ₩30m loan | “Cap is ₩100m, so ₩80m is safe” | ₩50m after set-off is what is protected |
You are not worse off. The loan disappears with it, so net worth is unchanged. What changes is how much of the cap you are using. In that example the cap consumed is ₩50m rather than ₩80m, which means another ₩50m at the same institution would still be protected.
The source stops there, though. Which loan is set off first, and whether arrears change it, are not on the page. Running deposits alongside a loan is covered in repay the loan or save.
What is not protected — products with similar names
At a savings bank, what actually decides it is the product's name rather than the rate. The mutual savings bank column of the coverage table, carried as written:
| Protected | Not protected |
|---|---|
| Ordinary and savings accounts, time deposits, instalment savings, credit instalments, cover bills | Bonds issued by the savings bank (subordinated bonds and the like) |
| DC and IRP balances held in protected products | DB retirement pension balances |
| Protected products held inside an ISA | — |
| Cashier's cheques issued by the savings banks' federation | — |
The time deposits and instalment savings you go looking for sit in the protected column. The one to watch is the subordinated bond — a savings bank sells it at a higher rate, and it is a bond rather than a deposit, so it is not protected. Placed next to a deposit on rate alone, it is an entirely different instrument.
Other names confuse in the same way — a securities firm CMA is not protected, while a merchant bank CMA is. The comparison is tabulated in where to park an emergency fund. The difference between deposits and instalment savings is in deposits vs instalment savings.
Some depositors are excluded outright, and the source names them — central and local government (including state schools), the Bank of Korea, the Financial Supervisory Service, the Deposit Insurance Corporation, and insured financial institutions.
Outside the deposit insurer — mutual finance and the post office
Five sectors appear in the coverage table: banks / investment dealers and brokers / insurers / merchant banks / mutual savings banks and their federation. Mutual finance bodies — community credit cooperatives, credit unions, primary agricultural cooperatives — are not on it. That does not mean no protection; it means each runs under its own statute and fund.
Post office deposits — one clause, and no cap in it
Postal Savings and Insurance Act, art. 4 (State liability for payment)
The State shall be responsible for payment of postal savings (including interest) and of insurance proceeds under postal insurance contracts.
That single sentence is the whole article, and it carries no figure. It sits at a different level from the insurer's ₩100 million — that is a fund paying up to a set limit, while this is the State being made responsible by statute. The parenthesis “including interest” also removes the problem flagged earlier: there is no scope here for interest to be cut to a determined rate.
The clause stops at “shall be responsible,” though. Procedure, timing, any cap in other provisions and budgetary constraints are not covered here. And the Act covers postal savings and postal insurance, so it does not extend to third-party products sold at a post office counter (funds, bancassurance and so on).
Credit cooperatives and credit unions — the verbs differ
Both share the same frame: a fund held at the federation, with member bodies required to join. But the verb in the clause on what happens when payment fails is different.
| Item | Community credit cooperatives Act art. 71 | Credit unions Act art. 80-2 |
|---|---|---|
| Name of the fund | Depositor protection reserve | Credit union depositor protection fund |
| Held where | The federation (not the deposit insurer) | |
| Joining | “shall join” — mandatory | |
| When payment fails | (4) “may repay” as decided by the reserve management committee | (4) “shall repay” on the members' claim |
| Neither Act states a coverage amount — they establish the fund and the repayment duty and leave the figure to subordinate rules. The figures below come from each federation’s own guidance. | ||
The amount is not in the statute; it is in each federation’s guidance. Both put it at ₩100 million per person.
- Community credit cooperatives — the federation’s depositor protection page states that “the protection limit per person is 100 million won,” paid from the depositor protection reserve.
- Credit unions — the federation’s depositor protection page states protection “up to a maximum of 100 million won per person, excluding share capital.” Protected interest is the lower of the contractual rate and the average one-year bank deposit rate, and any loan is set off first — the same structure as the deposit insurer.
One thing separates them here: share capital. The stake you pay to join a mutual finance body is equity, not a deposit, and is outside the cover. Reading “protected up to 100 million” and then building up share capital leaves that portion unprotected. The sector-by-sector basis is set out in the Ministry of Government Legislation’s plain-language guide to protection at credit cooperatives, the post office and local cooperatives.
“May repay” and “shall repay” are different words in a statute. We will not assert how that plays out in practice — but it is worth knowing that it is not identical to the deposit insurer before treating it as if it were.
Three separate limits on top — up to ₩400 million at one institution
The source sets out categories protected “separately and apart from” ordinary deposits.
| Category | Limit | Note |
|---|---|---|
| Ordinary protected deposit products | ₩100 million | Principal + stipulated interest, foreign currency included |
| DC, IRP and SME retirement pension fund balances | A separate ₩100 million | The three combined share one limit |
| Pension savings (trust and insurance) | A separate ₩100 million | — |
| Accident insurance proceeds | A separate ₩100 million | — |
| Total (our arithmetic) | Up to ₩400 million | If you hold all four |
| “₩400 million” does not appear in the source. It says only “each is protected separately and apart, up to ₩100 million per subscriber,” without giving a total. The figure above is our sum of the four. | ||
The pension account side continues in pension savings and IRP tax credits.
Three minutes before you sign
| Step | Check | Why |
|---|---|---|
| 1 | Is this a deposit or a bond? Look for the depositor protection marker on the signup screen | Subordinated bonds pay more and are not protected |
| 2 | Do you hold a loan there? | If so, the balance after set-off is what the cap is measured against |
| 3 | Do you already have money there? Other accounts, other branches, foreign currency included | Different branches still share one ₩100 million |
| 4 | Does the amount stay under ₩100 million measured at maturity? | At 3.5% the ceiling is ₩96.62 million |
| 5 | Is the institution within the deposit insurer's remit? | Mutual finance and the post office run under different statutes |
| Ordering the steps is ours; the basis for each line is the two KDIC pages and the three statutes. | ||
Questions that come up
So how much should I put in one place?
Enough that the maturity value at the contract rate stays under ₩100 million. At 3.5% over a year that is about ₩96.62 million (our calculation). Any other deposits or foreign currency you hold there come off that figure.
Are several accounts at one bank each protected?
No. The source states it is “not a limit per product type or per branch, but the total amount.” Within one institution, any number of accounts across any number of branches share one ₩100 million.
Aren't savings banks risky?
For a protected product within the cap, protection works exactly as it does at a bank. The two things that differ are the ones above — is it a deposit rather than a subordinated bond, and do you hold a loan there. Clear those two and using a special rate within the cap is unremarkable.
Does a married couple get ₩100 million each?
The source says “per person.” But the accounts have to actually be in separate names, and how joint accounts are apportioned is not on the page.
What about tax on the interest?
The cap is written before tax. What reaches you is after interest income tax, so it differs. Compare after-tax amounts in the maturity calculator.
What we read into it
A familiar sentence in the credit union statute
Article 80-2 of the Credit Unions Act carries paragraphs 6 and 7.
(6) … a member's claim to a repayment is extinguished by prescription if not exercised within five years from the day repayments begin.
(7) Notices and communications issued by the federation or the bankruptcy estate urging members to exercise the claim … do not interrupt prescription.
The structure matches a sentence found in unclaimed tax refunds — art. 54(3) of the Framework Act on National Taxes likewise says prescription “is not interrupted by a tax office's notice or guidance on claiming a refund.” “They wrote to me, so it must still be alive” does not hold here either. If a cooperative fails and repayments begin, a claim not made within five years simply lapses, and the federation's reminder letter does not extend those five years.
One number on the page contradicts another
The body of the coverage page says ₩100 million. A footnote on the same page still reads: “depositors with ₩50 million or less may continue with the acquiring institution on existing contract terms.” It looks like wording from before the cap rose. Checked on 30 July 2026; this article does not use the footnote figure. The page gives no explanation, so we make no guess about why it is there.
Sources
- Korea Deposit Insurance Corporation (tier 1, public institution) — Coverage limit (checked 30 July 2026). Source for “₩100 million per person, principal and stipulated interest combined,” “per person per financial institution,” “not per product type or per branch, but the total,” foreign currency inclusion, corporate depositors, the definition of stipulated interest, set-off, the three separate limits, and pro rata distribution of remaining assets.
- Korea Deposit Insurance Corporation (tier 1, public institution) — Protected financial products (checked 30 July 2026). Source for the protected and unprotected lists across the five sectors, the savings bank column with subordinated bonds unprotected, and the excluded depositors.
- Korea Ministry of Government Legislation (tier 1, government agency) — Postal Savings and Insurance Act, art. 4 [in force 25 Oct 2024, Act No. 20457]. Source for “the State shall be responsible for payment of postal savings (including interest).”
- Korea Ministry of Government Legislation (tier 1, government agency) — Credit Unions Act, art. 80-2 [in force 22 Oct 2026, Act No. 21573]. Source for the fund at the federation, mandatory membership, “shall repay,” and paragraphs 6 and 7 on the five-year prescription and notices not interrupting it.
- Korea Ministry of Government Legislation (tier 1, government agency) — Community Credit Cooperatives Act, art. 71 [in force 7 Jan 2025, Act No. 20648]. Source for the reserve at the federation, mandatory membership, and paragraph 4's “may repay as decided by the reserve management committee.”
- Korea Financial Investment Association (tier 2, association posting — not the agency's own page) — “From 1 September 2025, coverage rises from ₩50 million to ₩100 million (principal and interest included)” (posted 26 August 2025). Source for the 1 September 2025 effective date, which the coverage page itself does not state.
- Our own calculation. The principal figures reaching ₩100 million (₩97,087,379 / ₩96,618,357 / ₩96,153,846 / ₩95,693,780), the unprotected interest on ₩100 million (₩3m / ₩3.5m / ₩4m / ₩4.5m), the ₩289.86 million across three institutions at 3.5% with ₩10.14 million left over, and the ₩400 million total across the separate limits are all ours and appear nowhere in the sources. One-year term, simple interest, before tax.
Where to check further
- The statutes for primary agricultural and fisheries cooperatives — credit cooperatives and credit unions are settled above from federation guidance, but primary agricultural and fisheries cooperatives are not covered here. Check each federation’s guidance and the plain-language legal guide.
- Set-off order and joint accounts — which loan is set off first, and how a joint account is apportioned, are not on the KDIC pages. Start with the depositor protection FAQ, and put your own numbers into the coverage calculator. If that still does not answer it, ask KDIC (1588-0037) or your institution.
- Actual special rates — these move constantly, so no figures are carried here. Compare at the time you sign through the Financial Supervisory Service’s product comparison service, which hands off to the banking and savings-bank federations rather than showing a table itself.
Written as of August 2026. The cap and how it applies come from two KDIC pages, the basis for mutual finance and the post office from three statutes, and the amounts are marked as our calculations. This article is general information, not a product recommendation or investment advice. Protection differs product by product, so check the depositor protection marker on the signup screen yourself.
