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.
-
Aug 30, 2016
-
Aug 02, 2016
-
Mar 24, 2016
-
Jan 05, 2016
-
Nov 29, 2015
-
Oct 16, 2015
-
Jul 23, 2015
-
Jul 02, 2015
- Plan to Strengthen Competitiveness of Korea's Exchange Market
- The FSC outlined its plan to strengthen global competitiveness of Korea’s exchange market and boost vitality in capital markets to fund innovative businesses.BACKGROUNDFree capital flows and technology innovation intensify competition among stock exchanges across the globe. The world’s stock exchanges are actively seeking mergers, acquisitions and strategic alliances to expand their business scope and offer competitive services. A growing number of stock exchanges are turning themselves into a form of holding companies for organizational flexibility in response to changing market environment. Listings of stock exchanges have become increasingly common.The Korea Exchange(KRX) has been isolated from such a global trend, partly due to its status of monopolistic, non-profit public institution. The plan announced today is to reorganize the KRX’s ownership and governance structure to boost competitiveness and vitality of Korean stock exchange market.DETAILED PLAN1. Establish a holding company of the KRXThe FSC will make a revision to the Financial Investment Services and Capital Markets Act(FSCMA) to establish a holding company of the KRX(tentatively named ‘KRX Holding Company’). The KOSPI, KOSDAQ, and derivatives exchanges will be spun-off into subsidiaries of the KRX. Market oversight functions, currently carried out by the Market Oversight Commission under the KRX, will be transferred to a non-profit entity which will act independently from the KRX Holding Company and its subsidiaries. The Korea Securities Depository(KSD) will reorganize its governance structure to minimize a possibility of conflicting interests, given its role as public infrastructure. Clearing business, currently conducted separately by each exchange, will be carried out by a specialized clearing company. The company will also clear OTC derivative products.2. Strengthen competitiveness of KOSDAQThe KOSDAQ will be fostered to strengthen its competitiveness after its spin-off by boosting KOSD
-
Jun 18, 2015
-
May 11, 2015
-
Jan 27, 2015
- Plan to Support Convergence of Finance and Technology
- OVERVIEWThe convergence of IT and fin ancial sectors, or ‘financial technology’(here inafter ‘Fintech’), has emerged as a global trend. The trend also affects transaction pattern an d payment environment for domestic consumers and industries with rapidly growing c ross-border commerce and financial trans action on online or mobile platforms.Investment into the Fintech industry continues to grow around the globe, particularly in the U.S. and the U.K. with high e xpectation about the sector’s growth potential. As global IT leaders such as Alibaba and Apple entered payments market, the Fintech se rvices began to draw attention of the financial sector. Advanced countries including the U. K. actively support the growth of the Fintech indu stry to seize new growth opportunities.Korea has been less active in f ostering the Fintech sector so far due to regulatory barriers and financial security concern. As an IT powerhouse with the advanced financial industry, Korea has great potential for growth in the Fintech sector. In order for Fintech to bring innovative changes to financial services, we need to overhaul current financial regulatory framework mainly focused on offline serv ices. The FSC will also support financing of Fintech businesses and significantly lower barrier s to entry for electronic financial businesses. Financial security, however, is a prerequisite to t he growth of Fitech sector. To this end, the FS C will maintain a strict stance on security and c onsumer protection, while allowing financial service providers more room in their business o perations.1. Regulatory paradigm shift Minimization of ‘ex-ante’ regulationsSecurity review and evaluatio n for means of authentication will be abolish ed to allow financial firms to deliver consumers innovative convenient financial services and introduce more efficient authentication means on their own responsibility. (Revision to regulations related with electronic financial transaction within the second
-
Aug 25, 2014
-
Apr 03, 2014
-
Dec 16, 2013
-
Nov 13, 2013
- Plan to Improve Regualtions on Short Selling
- BACKGROUNDShort selling is one of investment techniques that investors sell either securities they do not own or ones they borrowed. Short selling can contribute to enhancing market efficiency as it provides liquidity and serves as a hedging tool for investors when stock prices fall. However, it has side effects as well. Naked short selling involves a risk of unfulfilled settlement.Speculative short selling prevents fair price forming the market.The Korean government has been strictly regulating short selling, compared to other countries.1 Naked short selling is prohibited. Since October 1, 2008, covered short sales of all stocks were banned. Short sales of financial stocks have been banned since then, while ban on short selling of non-financial stocks was lifted in June 1, 2009 except for the period from August 10 to November 9, 2011 when the ban was temporarily reinstated due to concerns about the European debt crisis.As the stock market have stabilized since the second half of 2013, however, there is a need to shift the government’s regulatory approach to short selling from direct regulations, which has been in place since the financial crisis in 2008, to indirect ones.After reviewing short-selling regulations in other advanced countries and problems raised about the current regulations, the FSC announced today its plan to improve regulations on short selling so that we can minimize side effects of short selling, while boost trading activities.KEY CONTENTS1. Lift ban on short sale of financial stocksBan on short sales of financial stocks, which has been in place since October 2008, will be lifted from November 14, 2013.2. Introduce disclosure requirements of investors’ short-selling positionsInvestors whose short-selling position in a stock exceeds 0.5% of total shares will be required to disclose their position on the KRX website.3. Improve effectiveness of the current regulations on disclosure of short-selling positionsThe FSC will establish a legal ground
-
Jun 18, 2013
-
Jun 12, 2013
-
Apr 18, 2013
-
Sep 27, 2012
- Plan for Revision to Regulations on Supervision of Banking Business
- BACKGROUNDThe FSC/FSS started to revise the Regulations and Detailed Regulations on Supervision of Banking Business for domestic implementation of the Basel III rules, which will take effect in 2013.KEY REVISIONS1. Revision of minimum capital requirementMinimum capital requirement for banks will be subdivided from the current 8% of the total capital into three criteria: 4.5% of common equity Tier 1, 6% of Tier 1 capital, and 8% of the total capital.2. Introduction of capital buffer1Banks will be required to reserve an extra capital buffer of 2.5%p in addition to the minimum capital requirement. Unlike minimum capital ratios, capital buffer is not a mandatory requirement; however, if banks fail to meet capital buffer requirement, they will be limited in dividend payment or share repurchase.3. Revision of conditions for corrective measures to be taken and evaluation of management status(1) Conditions for corrective measures to be takenCurrently, banks are ordered to take corrective measures depending on their equity capital ratios: management improvement recommendation for less than 8%, management improvement requirement for less than 6%, and management improvement order for less than 2% of equity capital.With the implementation of Basel III rules, such conditions will be further subdivided into three criteria: total capital ratio, Tier 1 capital ratio, and common Tier 1 capital ratio. Corrective measures Current Proposed revision Management improvement Less than 8% of BIS ratio 1. less than 8% of the total capital 2. less than 6% of Tier 1 capital recommendation 3. less than 4.5% of common Tier 1 Management improvement Less than 6% of BIS ratio 1. less than 6% of the total capital 2. less than 4.5% of Tier 1 capital requirement 3. less than 3.5% of common Tier 1 Management improvement order Less than 2% of BIS ratio 1. less than 2% of the total capital 2. less than 1.5% of Tier 1 capital 3. less than 1.2% of common Tier 1 (2) Evaluation of management statusUnder the
-
Sep 06, 2012
