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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Aug 25, 2008
- FSC’S Policy Efforts for Financial System Advancement and Future Tasks
- Since the establishment of FSC, instability in the external environment has aggravated due to the sub-prime mortgage related global stock market shock, global investment banks’ fragility, anxiety of stagflation due to combined factors of increased oil price and economic recession. Internally, there have been difficulties in the construction and SME sectors due to the domestic recession. Under such challenging circumstances, FSC has not only provided support to stabilize the domestic financial market, but also to perform an essential role as a growth engine to drive the Korean economy. In particular, FSC is focusing on policies to further develop the financial industry, offer financial support to create a sharing society, and construct a global financial network, among others.1. Policies implemented since the establishment of FSC- Exert various policy efforts to stabilize the financial marketFSC has closely examined the money flow at home and abroad by constructing a market monitoring system with the Financial Supervisory Service (FSS) and other financial institutions in order to manage the financial market volatility caused by the global credit crunch.FSC has mitigated the market anxiety through active information notification and strengthened supervision. For example, FSC attempted to intercept the spreading anxiety by notifying the public of correct government information on the domestic banks’ foreign currency liquidity status and the rumor about the September crisis. In addition, FSC has not only strengthened supervision on risk factors such as marketable demand deposits in the banking industry, project finance loans, foreign currency liquidity, possibilities of unfair transactions, including market price control, but also expanded the foundation to detect and respond to risks at an early stage by applying the Early Warning System in the financial sector.- Promote political tasks to develop the financial industryFSC has triggered innovation in the financial
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Aug 27, 2007
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Dec 18, 2006
- New Measures Proposed to Advance the Bond Market
- The Financial Supervisory Commission announced a set of proposals aimed at advancing the bond market on December 14. The new proposals are the work of a joint public-private task force created in February this year to recommend improvement in four key areas—corporate bond underwriting, market liquidity, trading of repurchase agreements, and disclosure—and help raise the transparency and efficiency of the bond market.1 The legal and regulatory amendments needed for the changes proposed by the task force are expected to be completed by June, 2007.Bond Market TrendSince the financial crisis, the bond market has shown a steady growth with the total issue amount and the trading volume increasing more than two-fold and five-fold, respectively, since 1998. Recently, however, corporate debt-financing has been declining amid falling capital demand for corporate investment and investors showing preference for cash accumulation.Corporate Bond Underwriting by Securities CompaniesAs a result of weak capital demand and the growth of privately placed issues, the market for corporate bond underwriting has been shrinking, putting a downward pressure on profits securities firms generate from underwriting.Securities firms authorized to underwrite bond issues numbered 45, 31 of which took part in an actual bond underwriting. Fees generated from underwriting averaged KRW3 billion for each securities firm in 2005.Because local securities firms compete more on underwriting fees than on funding ability, risk analysis, raising interest among investors, and other critical underwriting capabilities, they have thus far failed to build the kinds of reputation that investors generally expect. Local securities firms are also continually exposed to legal risks for inadequate attention to investor protection, e.g., poorly administered due diligence and faulty prospectus.Task Force ProposalAs a way to discourage unhealthy competition and improve the overall caliber of corporate bond underwriting
