[THE INVESTOR] South Korea’s state pension program provides monthly coverage for up to 4 million people, data showed on June 28, with the number of recipients on the rise.
A total of 3.98 million senior South Koreans received a combined pension payment of 1.4 trillion won (US$1.19 billion) per month as of April this year, up from the 3.59 million in 2015.
Each pensioner was getting an average of 889,000 won ($753), according to the National Pension Service. The largest monthly payment was 1.88 million won, according to the National Pension Service. In 2002, the number of pension recipients stood at 917,000 with pension payments totaling 173.6 billion won.
The number of pensioners is now expected to rise to 5.93 million in 2020 to exceed the 10-million mark in 2030, the NPS said.
The state pension program was introduced in 1988 to guarantee income for the elderly after retirement and to provide coverage for disabilities and surviving family members.
South Koreans are entitled to receive national pension payments after paying premiums for up to 10 years until the age of 60 during their working years.
In a report released a week ago, the NPS estimated that 91.3 percent of 17.62 million South Koreans aged 65 and older would receive state pensions in 2060, when the country’s national pension fund is forecast to dry up.
Experts point out that South Korea’s aging population is putting a strain on the pension system. Koreans aged 65 years or older accounted for 13.1 percent of the country’s population of 50.62 million in 2015. A country is defined as an “aged society” if more than 14 percent of the population are 65 or older.