S. Korea to double international money transfer limit to $2,000

By Yoon Ja-young

The South Korean government plans to allow individuals to freely send up to $2,000 abroad per transaction without reporting to the government, double the current amount.

Businesses will also be allowed to invest up to $500,000 abroad without prior notice.

These are parts of the deregulation plan on foreign exchange, announced by the Ministry of Strategy and Finance Thursday. Implementation is expected next year at the latest, after the revised bills are approved at the National Assembly.

“To enhance the convenience of the people and facilitate corporate activities, the government decided to revise regulations related to foreign exchange,” an official in charge of such policies at the ministry said.

Currently, individuals can send up to $1,000 abroad without reporting it to the government, but the ceiling will be raised to $2,000.

The finance ministry said that around 30 to 40 percent of the foreign exchange transmissions are $2,000 or less.

It will also allow regional Nonghyup, a farmers’ cooperative, to deal with foreign exchange transmission services if there is no other bank in the region.

Each individual will be allowed to send up to $30,000 through regional Nonghyup annually. This will be implemented from October.

“In rural areas, you had to go to a bigger town to send money abroad. We expect the measure will lessen the inconvenience of the people. Migrant workers will also benefit from this,” the official said.

The money exchanges will be exempt from administrative procedures — filling in reporting forms — for small sum exchange services, each amounting $2,000 or less, making conversion easier for tourists.

“There is a need to make money conversion easier, as foreign tourists have increased,” the ministry said.

The number of foreigners traveling to Korea increased to 12.2 million last year, from 9.8 million two years ago.

The government also plans to facilitate foreign direct investment by Korean companies. They will be allowed to invest up to $500,000 abroad without reporting to the government in advance.

Currently, businesses are obliged to report their investment in advance, regardless of the amount.

The government has been easing foreign exchange regulations continuously, scrapping the ceiling on the amount of FDI or real estate acquisition abroad.

However, it said that minimum level of regulation will be maintained to prevent illegal transactions and speculation on the Korean won.

“With uncertainties in the global economy continuing since the 2008 global financial crisis, we determined that we should improve the regulations instead of totally scrapping them,” the ministry said.