FSC promotes fintech and innovation in financial services. In order to encourage convergence and collaboration between finance and information technology, FSC launched the financial regulatory sandbox scheme in April 2019, through which more than one hundred ‘innovative financial services’ have been designated. The regulatory sandbox program allows fintechs and start-ups to test out their ideas without worrying about the regulatory impediments. In addition, Korea’s open banking system was fully launched in December 2019, opening up payment networks to both banks and fintechs through a joint network. By creating a financial data exchange platform, fostering MyData industry and opening up extensive sets of public financial data stored at major public institutions, FSC is also working to create an environment where big data and AI can play a larger role in finance. Policies intended to promote innovation also include providing tailored support to the Korean fintech firms to help them grow and scale up as global unicorns by easing regulations, expanding investment and providing assistance for overseas business expansion.
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Nov 25, 2020
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Nov 19, 2020
- FSC Designates 5 More ‘Innovative Financial Services’ for Regulatory Sandbox
- The FSC added five more financial solutions to the financial regulatory sandbox on November 19, bringing the total number of ‘innovative financial services’ to 120 since launching the financial regulatory sandbox program on April 1, 2019.OVERVIEW OF NEWLY ADDED ‘INNOVATIVE FINANCIAL SERVICES’1.A mobile app-based real name verification service for bank customers who visit bank branch without a government-issued identification (Shinhan Bank, expected launch in September 2021)2.A safe driving reward program, which offers a gift certificate of KRW10,000 to navigation app1 users with a car insurance policy2 when their driving records collected via a driving-tag3 meet safe-driving standards (Carrot Insurance SK Telecom, expected launch in December 2020)3.A point-payment service for an insurance claim that allows customers to purchase products or services at a discount with given points on an online platform (Hanwhalife, expected launch in April 2021)4.A credit card membership solution, which allows merchants to join membership through a mobile app (PayHere, expected launch in July 2021)5.A mobile credit card terminal solution, which uses the app on a smartphone as a card reader instead of a terminal machine (ANB Korea, expected launch in May 2021)* Please refer to the attached PDF for details.
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Nov 12, 2020
- 4th Digital Finance Meeting Outlines Three Key Principles for MyData Industry
- Vice Chairman Doh Kyu-sang presided over the 4th consultative body meeting on digital finance on November 12 and laid out the following three key principles for the MyData industry—(a) guaranteeing consumer rights to data ownership, (b) improving safety and scalability of MyData services and (c) creating a cooperative ecosystem for all stakeholders.The following is a summary of Vice Chairman Doh’s remarks.SIGNIFICANCE OF MYDATA INDUSTRYMyData industry has been introduced to strengthen consumer rights to data ownership and cultivate new data industries. With MyData services, individuals will be able to manage within a single platform not only their credit data from different financial institutions, such as banks, credit card companies and insurance companies, but also non-financial information, such as data on telecommunication and public utilities fees. There have been similar attempts in other countries, such as the EU, the UK and Japan, but their services have been restricted to bank account data.MyData industry in Korea is the first in its kind, offering an integrated credit data management platform beyond banking services. Currently, a preliminary license application review is taking place on thirty-five existing MyData business entities, with the application results expected to be announced at the beginning of next year. The market entrance of MyData businesses as new players will bring about a few changes. First, consumers will be able to practice data ownership instead of financial institutions in which consumer data is stored. Consumers’ control over their own data will be enhanced as they can easily check, manage, correct or delete according to their needs. Second, there will be increased competition and innovation in the financial industry. Large financial companies will no longer have a monopoly over consumer data, but instead be encouraged to compete over consumer utility. Lastly, MyData businesses will help create quality jobs in ICT and fintech s
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Nov 10, 2020
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Nov 04, 2020
- FSC Selects Two More Fintechs as Designated Agents to Provide Financial Services
- The FSC selected Finotek and Big Value as designated fintech firms on November 3, allowing them to provide financial services on behalf of Jeju Bank, BNK Kyongnam Bank and Kwangju Bank, and Pepper Savings Bank, respectively.Finotek will make available online refinancing brokerage platform service, which is expected to improve consumer convenience and efficiency while saving costs.Using big data and artificial intelligence technologies based on public data, Big Value will provide estimates on market prices and collateral values of atypical assets. Operating a big-data driven automated price estimation system for small-scale real estate properties, this service is expected to boost price transparency and enable financial businesses to improve their work efficiency.The FSC has selected a total of 33 designated fintech firms so far since May 2018. Application for the next round will be open from November 9, 2020 to January 8, 2021, with the results expected to be announced in March next year.* Please refer to the attached PDF for details.
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Oct 21, 2020
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Oct 21, 2020
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Sep 24, 2020
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Sep 24, 2020
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Sep 10, 2020
- FSC Holds 1st Consultative Body Meeting on Digital Finance
- The FSC launched a public-private joint consultative body on digital finance, composed of leaders and experts representing financial sectors, big techs, fintechs and major financial labor unions, and held a kick-off meeting on digital finance via teleconference on September 10.The joint consultative body has been set up to tackle diverse challenges arising from the era of digital finance and offer balanced perspectives and solutions. The consultative body will operate four thematic working groups on (i) big tech-fintech relations, (ii) rules and regulations, (iii) financial data security and (iv) financial consumer protection.During the meeting, Vice Chairman Sohn Byungdoo spoke about the need to (i) continue regulatory reforms to promote innovation in financial services, (ii) build a fair competition environment for market participants, (iii) ensure consumer safety in digital finance, (iv) review risk factors related to financial market stability and (v) evaluate the impact of digital transformation on the society as a whole.The participants agreed on the need to have ongoing discussions on how to further develop the traditional financial industry and to promote close cooperation and win-win strategy between financial enterprises and digital platform businesses including fintechs.The joint consultative body will hold meetings regularly throughout this year and make its findings available to the public.* Please refer to the attached PDF for details.
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Sep 02, 2020
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Aug 26, 2020
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Aug 20, 2020
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Aug 13, 2020
- Green Finance Task Force Holds Kick-off Meeting
- Vice Chairman Sohn Byungdoo presided over a kick-off meeting of the green finance task force on August 13. The task force will work to establish a monitoring system for financial risks emanating from climate change, boost investment in green industries and consider the possibility of joining international networks on green finance.The following is a summary of Vice Chairman Sohn’s remarks.(GREEN SWAN) In January this year, the BIS introduced the concept of the ‘Green Swan,’ warning about the possibility of financial crisis caused by climate change. In the BIS report, the threat of climate change is characterized by unpredictability, severe ripple effects and extensive negative externalities. As such, major countries and international organizations have come to understand the threat of climate change to the financial sector. In July 2017, the FSB Task Force on Climate-related Financial Disclosures made recommendations to help companies disclose climate-related financial risks, and in December of the same year, the Network for Greening the Financial System was launched by central banks and regulators from major economies.(PROACTIVE MANAGEMENT) Climate change can threaten the stability of the financial system in many different ways. There are physical risks that financial institutions may face as physical damages caused by climate change can have ripple effects through insurance, loans and investment. In addition, there are transition risks that can have negative effects on the stability of the financial system as a transition to low carbon economy can lead to an abrupt fall of carbon intensive industries. In this regard, the government will strengthen its efforts to monitor and identify climate change risks to maintain stability in the financial system.Financial institutions should also consider taking into account the environmental, social and governance factors alongside the traditional risk factors such as credit or liquidity risks for their asset management.
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Aug 06, 2020
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Jul 31, 2020
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Jul 30, 2020
- FSC Chairman Speaks about Innovation at Mapo Front 1 Opening Ceremony
- FSC Chairman Eun Sung-soo delivered congratulatory remarks at the opening ceremony of the Mapo Front 1, the government-backed start-up incubating facility on July 30. The following is a summary of Chairman Eun’s remarks.With the COVID-19 pandemic situation continuing for about six months, start-ups faced challenges amid continuing instability and uncertainty. However, as the country recovers from the pandemic-induced economic crisis, new opportunities will be provided to innovative start-ups. The government’s digital and green new deal initiative announced on July 14 aims to set the stage in that regard.In order to foster an ecosystem for innovative start-ups and to support innovative changes in our economic structure, it is necessary to establish a strong support system. The Mapo Front 1, which is the world’s largest start-up incubating facility, provides such a framework. The facility provides a comprehensive support package ranging from financial support to educational programs to living spaces to overseas business expansion opportunities, which has been made possible by participation and cooperation of both the public and private sectors, including the financial industry, international organizations, local governments and large companies.The Mapo Front 1 will be housing about 90 innovative start-ups this year with an aim to provide incubating programs to up to 2,700 start-ups over the next five years and create about 18,000 new jobs.In order to provide continuous support after the start-up stage, the government has made available a scale-up fund worth about KRW15 trillion over a five-year period (2018-2022).In addition, the government has announced its plans to provide targeted support to one thousand innovative firms over the next three years, through which selected start-ups will be able to receive a variety of funding opportunities.Through these and other support programs, the government will continue to work to create an environment in which innovative
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Jul 28, 2020
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Jul 27, 2020
- FSC Announces Plans to Promote Digital Finance
- The FSC unveiled its plans to promote digital finance on July 24, focusing on improving regulations for the industry, ensuring strong protection for digital finance users, building foundations and infrastructure to facilitate large volumes of digital financial transactions and strengthening data security to ensure stability in the financial system.BACKGROUNDDigital finance as a major ‘untact’ industry has grown significantly with the development of simple payment and money transfer services, authentication technologies and platform businesses. With the introduction of new technologies and the expanded use of e-commerce and telecommuting, digital transformation of the financial industry has been accelerated. The convergence of digital finance with ICT sectors and platform businesses will not only lead the transformation toward a digital economy but also help enhance financial inclusiveness.Recognizing the significance of digital finance, major economies have made changes to their regulatory framework to promote competition and innovation. Meanwhile, the Electronic Financial Transactions Act in Korea has not seen major updates since it was first enacted in 2006. As such, the current regulatory framework cannot fully accommodate the changes taking place in the financial industry which pose the following obstacles—a) relatively high entrance barriers for innovative electronic financial business entities, b) lack of strong user protection measures to guarantee safety in digital transactions and earn consumer trust, c) need for new infrastructure fit for new financial environment, and d) need to ensure financial data security.With the revisions to the Electronic Financial Transactions Act, the FSC will boost both convenience and safety of digital finance users, promote innovation and competition in the financial industry, and contribute to the government’s digital new deal initiative.KEY POLICY AGENDAI. PROMOTE GROWTH OF INNOVATIVE DIGITAL FINANCE PLAYERS (INDUSTR
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Jul 23, 2020
- FSC Adds 4 More 'Innovative Financial Services' to Regulatory Sandbox
- The FSC added four more ‘innovative financial services’ to the regulatory sandbox on July 23, bringing the total number of designated services to 110 since the sandbox program was first launched on April 1, 2019.In order to support digital transformation and promote the government’s new deal initiative, during the second half of this year, the FSC will begin to accept applications on a rolling basis with a particular focus given to new technologies such as big data, AI, digital authentication, payment, data security, etc. Interested firms may apply online throughout the year. OVERVIEW OF NEWLY ADDED ‘INNOVATIVE FINANCIAL SERVICES’1. An intellectual property rights based investment and fund raising mechanism that allows SMEs to raise funds with IP rights through trust companies and recruit investors through a crowdfunding platform (Hana Bank Wadiz, expected launch in January 2021)2. A mobile-based comprehensive retirement pension advising service that analyzes individuals’ multiple pension accounts and offers advises on pension products (Doomoolmori, expected launch in December 2020)3. An online financial investment platform that conveniently allows investors to purchase coupons for purchasing investment products on securities exchange platforms (KB Securities, expected launch in February 2021)4. A data analysis service using homomorphic encryption, which makes possible the coding of personal financial information stored in different financial institutions for analyzing purposes (Korea Credit Bureau, expected launch in august 2020) * Please refer to the attached PDF for details.
