According to the Financial Supervisory Service's (FSS) announcement on the retirement pension default option system for the fourth quarter of last year, the accumulated assets increased by 219% year-on-year to 40 trillion won, from 12.552 trillion won in the same period of the previous year. The number of designated subscribers also increased by 32% year-on-year to 6.31 million, from 4.79 million in the previous year.

Currently, 315 products from 41 financial institutions have been approved by the government for the default option system. Among them, 68 products with medium or high risk ratings showed a one-year return of more than 15%.

"Since the purpose of introducing the default option system is to improve the rate of return, the government is continuously promoting institutional improvements to alleviate the phenomenon of being biased towards principal-guaranteed products," the FSS explained. "First of all, from this year's announcement, the sales ratio of accumulated funds by risk rating of individual financial institutions will be additionally disclosed."

"We expect that informing the degree of bias towards principal-guaranteed products with relatively low returns will induce subscribers to actively invest and serve as a catalyst for financial institutions to strengthen subscriber support services," the FSS added. "The current name of the default option product emphasizes 'risk', which has the aspect of hindering reasonable investment, but from April, the name will be changed to focus on 'investment' so that subscribers can choose a default option product suitable for their propensity."

The names of default option products will be changed to Safety type for the lowest risk, Safety investment type for low risk, Neutral investment type for medium risk, and Aggressive investment type for high risk. Detailed public information can be found on the Ministry of Employment and Labor website and the FSS's Integrated Pension Portal.