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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May 30, 2023
- Online One-stop Loan Transfer System Available
- The FSC announced that financial consumers will be able to make a switch from their existing credit loans to loans offering more favorable borrowing conditions using their smartphones without having to visit a branch office of financial institutions beginning on May 31. Establishing an online one-stop loan transfer system has been a key policy agenda of this administration to help alleviate peoples interest payment burdens and promote digital transformation in the financial sector and competition between banks. In this regard, the FSC has been closely working with the Financial Supervisory Service, the Korea Financial Telecommunications Clearings Institute, major financial companies and fintech businesses to launch an online one-stop loan transfer system. In particular, prior to its launch on May 31, authorities have closely looked into ways to improve user convenience and guarantee stability and security of the system. Beginning on May 31, consumers will be able to use their smartphone apps (MyData-enabled loan comparison platform app or major financial company apps) to search for loans offering better borrowing terms and make a switch from their existing credit loans issued by 53 financial institutions (19 banks, 18 savings banks, 7 credit card companies and 9 specialized credit finance businesses). The online one-stop loan transfer app service will be available during the banks operating hours from 9:00 am to 16:00 pm on business days. Consumers can use the loan transfer service for their existing credit loans of up to KRW1 billion issued by 53 financial companies. From the time of downloading a mobile app until completing the verification of result, the service usage time is estimated to be around fifteen minutes, which is significantly shorter than at least two business days it took for consumers to visit the branch office of two financial institutions previously. The loan conditions calculated for consumers will be based on the same lending standards (maximum
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May 17, 2023
- FSC Chairman Speaks about Opportunities and Challenges in Embracing AI in Financial Sector
- FSC Chairman Kim Joo-hyun attended a seminar on boosting the competitiveness of artificial intelligence (AI) in financial sectors hosted by Korea Credit Information Services on May 17 and delivered congratulatory remarks. At todays seminar, experts from both public and private sectors shared key trends of AI usage in financial sectors and discussed policy strategies to boost the competitiveness of the financial industry. The following is a summary of FSC Chairman Kims remarks. Summary of FSC Chairmans Remarks The development of hyper-scale, generative AI has recently put a new spotlight on the potential of AI. Investment in AI and its usage have been growing in diverse areas where AI can be put to use to help increase convenience for consumers and make financial companies core functions more efficient. At the same time, it is also crucial to consider ways to effectively respond to situations of AI failures or digital herding. Financial institutions are strongly encouraged to invest in AI and make use of the technology to enhance the global competitiveness of domestic financial businesses. The FSC has been working to embrace the use of AI in financial services and will continue to provide active support in this regard. So far, authorities have introduced a number of guidelines on AI, for example, on using and developing AI in financial sectors, verifying AI-based credit scoring models and ensuring security in AI-based financial services. Going forward, first, the FSC plans to establish a data library for AI in financial sectors and designate more data specializing institutions to facilitate big data analytics. Second, the FSC will work to improve the regulatory environment on financial data to promote an expansion of new AI-based services. Lastly, the FSC will set up a testbed for AI in financial sectors and prepare a guideline on explainable AI (XAI) with a goal to help increase confidence in AI-based financial services. The FSC will work to ensure that the specific
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Apr 06, 2023
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Dec 26, 2022
- FSC Plans to Bolster Support to Promote Sustained Growth of Fintech Businesses
- The FSC announced a set of measures to strengthen support for fintech businesses, which is confirmed after discussion and deliberation at the 5th financial regulatory innovation committee meeting held on December 20. Against the backdrop of the current industrial situation where fintech businesses face funding shortages amid interest rate hikes, waning impetus of industrial growth and difficulties in expanding their business into overseas markets, these measures will expectedly boost multiple facets of fintech business supports, such as funding or promotion of startups. Key Measures I. Strengthen Support through Investment and Policy Funds a) (Increasing the Size of Fintech Innovation Fund) The size of the fintech innovation fund, initially planned as KRW500 billion for four years (2020-2023), will be increased to KRW1 trillion by adding KRW500 billion for another four years (2024-2027). Authorities will improve operation methods by (a) ensuring continuous operation of the early-stage fintech investment fund, which has been operated intermittently, and (b) newly creating a commercialization fund intended to make investment in those who seriously prepare business expansion at the commercialization stage. b) (Increasing Support through Policy Financial Institutions) Tailored support for fintech businesses will be made in the form of loans and guarantees from policy financial institutions in the amount of at least KRW200 billion a year. c) (Establishing Comprehensive Fintech Support System) Authorities will set up and operate Fintech Support Council, consisting of representatives form 14 institutionsthat currently operate their own fintech support programs, to make their support programs more systematic and effective. The participating institutions will establish a common databaseto monitor the growth history as well as the record of support provided for each fintech business. A fintech focused investor relations (IR) event will be held at least once every half a year.
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Dec 22, 2022
- FSC Unveils Measures to Improve Corporate Financial Data Infrastructure to Support More Businesses
- The FSC announced a plan to make improvements to the corporate financial data infrastructure to assist micro-enterprises, SMEs and innovative businesses for which the availability of relevant data infrastructure has been inadequate thus far. The key measures include (a) revamps of the corporate data management system operated by the Korea Credit Information Services (KCIS), (b) expansion of data sharing with financial sectors on innovative businesses in new industries, (c) improvement of the entry regulation for business credit bureaus (business CBs) more reasonable and enablement of CBs for data-specialized institutions and (d) reviewing a launch of MyData service tailored to the needs of sole proprietors. As these measures have been discussed at the 5th financial regulatory innovation committee meeting held on December 20, authorities will seek prompt implementation of the detailed measures. Background Financial authorities have successfully introduced various systems, including the financial MyData service and improvements to the personal credit rating system, to bring about innovation in consumer finance. In corporate finance, too, authorities have subdivided business CBs into several licensing unitsand lowered their entry requirement.However, there still exists insufficiency of credible data on micro-enterprises, SMEs and innovative businesses. For SMEs and micro-enterprises, there is not enough data being produced and distributed to be utilized in corporate finance, and business CBs capabilities of data management remain inadequate. As such, even when a company has decent repayment capacity, it may be asked for an excessive level of collateral or guarantee, or face the burden of unfavorable borrowing conditions such as a low level of maximum loan amount or high interest rate. For innovative businesses, due to inadequate information on new industries, financial institutions face difficulties in evaluating the growth potential and the innovativeness of new indus
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Dec 07, 2022
- FSC Chairman Attends KDB NextRound's Fintech Special Round and Speaks about Expanding Fintech Investment
- FSC Chairman Kim Joo-hyun attended the Fintech Special Round event hosted by the Korea Development Bank NextRound on December 7. At the event, Chairman Kim briefed on the direction of governments policy aimed to drive innovation in digital finance and cultivate the fintech industry, while encouraging fintech startups that seek to attract investment. Summary of Congratulatory Remarks by FSC Chairman FSC Chairman Kim Joo-hyun highlighted that the future of our financial industry is dependent on how well the government responds to the fourth industrial revolution and digital transformation as the pace of such shifts accelerates. To follow these shifts, the government has so far spared no effort to come up with multifaceted measures such as introduction of a financial regulatory sandbox program and creation of the fintech innovation fund. However, as global monetary tightening and the three highs such as inflation, high exchange rates and high interest rates, etc. intensify economic uncertainty, the venture business and startup markets around the globe are facing the severe funding winter, and fintech sectors are struggling with this difficult situation. Against this backdrop, Chairman Kim underscored his plan to strengthen policy support to help fintech companies to overcome this hard time and enlarge innovation capacity to drive the future of financial industry. The following shows details of this policy support. I. Expanding Availability of Funding Support for Fintech Startups The authorities will offer support to help innovative businesses grow such as introducing the innovation growth fund worth of KRW15 trillion for five years from 2023 and a new Silicon Valley-style lending program for venture businesses, which will offer loans combined with zero-interest rate bonds with warrants. Furthermore, the authorities plans to bolster the financial support system specialized for fintech businesses with increasing the size of the fintech innovation fund from KRW500 billion
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Nov 24, 2022
- FSC Chairman Meets with Venture Startups and Holds Talks on Boosting Investment
- FSC Chairman Kim Joo-hyun visited Mapo Front1, the largest startup support center in Korea, on November 24, where he held talks with venture businesses, venture capitalists and financial institutions. Chairman Kim listened to difficulties and complaints from startups and venture businesses and also asked financial institutions to increase investment and support for startups and venture businesses. Summary of FSC Chairmans Remarks Startups and venture businesses are essential for increasing our economys growth potential and creating jobs. Thus, it is important to establish an ecosystem where they can thrive. Meanwhile, to improve our economys competitiveness, more startups and small businesses with technological prowess and innovativeness need to be fostered even in times of investment drought. Therefore, the FSC and policy financial institutions will strengthen their support for innovative and promising venture businesses by providing more funding opportunities and acting as a priming pump to attract more private sector investments. For this, the innovative growth fund worth KRW15 trillionwill be created over the next five years to support SMEs and startups in new industries such as semiconductor and artificial intelligence (AI) and to supply venture businesses the funds in need to grow up into unicorn companies. Second, policy financial institutionsKorea Development Bank (KDB), Industrial Bank of Korea (IBK) and Korea Credit Guarantee Fund (KODIT)will introduce a lending program worth KRW6.3 trillion, which will provide funds to startups and venture businesses based on loan examinations focused on their growth potential rather than their financial statements and the value of collaterals. In particular, the IBK will introduce a new lending program for venture businesses, modeled after those observed in Silicon Valley, which will offer loans with zero-interest rate bonds with warrants (BWs) attached. This program will enable early-stage venture businesses to continue
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Nov 21, 2022
- FSC Plans Regulatory Reforms in Insurance Sector to Promote Digital Transformation
- The FSC announced a plan to reform regulations on insurance businesses to help the insurance sector more effectively respond to emerging demands for new services and to facilitate the entry of specific business models expected by the market. The plan has been screened by the financial regulatory innovation committee at its 4th meeting held on November 14. Authorities will prepare revision bills to amend relevant laws with a goal of submitting and passing them at the current 21st term of National Assembly. Background The FSC has listened to opinions on the areas that require regulatory reforms through discussions within a taskforceon insurance sector (from February) and the survey of demands (June-July) conducted across all financial industry groups. Among 234 regulatory reform items raised by eight financial industry groups, the demand for regulatory reform in the insurance sector was particularly high (77 items). According to the taskforce and the survey, the insurance industry faces hindrance in effectively adapting to disruptive changes of business environment due to outdated and stringent regulations. First, even with a spread of digital economy based on network- and platform-based services, the level of digital transformation in the insurance market is still at a nascent stage, requiring an urgent industrial restructuring. Second, compared to insurance markets in other countries and other domestic financial markets, insurance businesses face excessive regulations for product development and asset management, which restrict insurance companies from supplying diverse types of financial products and weaken their global competitiveness.Third, there are cases where the rigor of penalizing practices and supervisory administration led to excessive restriction on the sales activities of insurance companies. For the consumer service of the supervisory authorities to deal with civil complaints, which cannot be served promptly due to the limited number of staff members an
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Oct 20, 2022
- Scope of Data Categories for Financial MyData Service to be Expanded
- The FSC announced a plan to expand available data on financial MyData service from the end of this year. The number of personal data categories will grow significantly from 492 to 720, which can cover most financial sectors including banks, insurers, card companies, financial investment firms and public financial institutions. A demand survey on MyData service providers in March 2022, which was conducted right after the launch of financial MyData service in last January, revealed additional data categories that need to be added. To insert these categories into MyData ecosystem, many data providers like financial industry groups, financial institutions and MyData service providers voluntarily organized MyData taskforce to discuss mutual development and cooperation. Between April and August this year, the taskforce held over 40 meetings and reached an expansion plan. MyData portal (www.mydatacenter.or.kr) will provide information on new service offerings and service improvement of MyData service providers, enabled by this expansion of data categories available. Achievement So Far (Penetration of MyData Service) Since the launch of financial MyData service on January 5 this year, financial MyData service has grown rapidly. The cumulative number of subscribers grew to about 54.8 million (in September 2022), increased about 3.9 times from about 14 million users in January. The volume of API (Application Programming Interface) transfers per day went up from 274 million at the end of January to about 384 million at the end of September. The number of MyData service providers also increased from 33 to 52 for now. (Enhanced Consumer Convenience) Financial MyData service made data ecosystem more consumer-oriented where financial consumers can quickly and conveniently access a variety of their personal data scattered around financial sphere with a single sign-on. As data sharing practice changes from indiscriminate data scraping to formal data transfer under consumer acknowled
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Sep 28, 2022
- 2022 Korea Fintech Week Opens
- The 4th annual global fintech expo, 2022 Korea Fintech Week will be held for three days from September 28 to 30 for both on-site (Lotte Hotel Seoul) and online viewing. Fintech businesses and experts from at home and abroad participate. Welcoming Remarks by FSC Chairman FSC Chairman Kim Joo-hyun delivered welcoming remarks at the opening ceremony. He spoke about the economic, financial and regulatory environment surrounding the fintech ecosystem and the governments policy direction to promote fintech. The following is a summary of Chairman Kims remarks. Koreas fintech industry expanded its size significantly in terms of the number of businesses in operation. However, recent global fintech rankings show Koreas ranking dropped from 18th in 2019 to 26th in 2020. And currently, fintech firms are facing challenges from expanding platform-based big tech companies and financial institutions which accelerate digitalization. Fintech firms also experience difficulties in attracting investments amid tightening monetary policies around the world. Besides, there are continuing concerns about inflexible regulations in the financial sector. In response to rapidly changing conditions surrounding the fintech industry, the government will act in a more agile manner to support fintech businesses in four aspects. First, the government will improve the financial regulatory sandbox program to promote commercialization of fintech services in order to make fintech startups to utilize this program more actively. Second, the government will examine and strengthen the financial support infrastructure to facilitate investment and funding on fintech firms. Third, the government will work to expand regulatory flexibility for artificial intelligence (AI)-based services and the rules on cloud computing use and network separation. Fourth, through a fundamental reexamination of current regulations, the government will actively pursue digital regulatory reforms throughout the whole financial industry
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Aug 26, 2022
- Financial Regulatory Reform Committee Discusses Ways to Promote Platform-based Financial Services
- The financial regulatory reform committee held its 2nd meetingon August 23 and decided on plans to (a) promote platform-based financial services from financial institutions and pilot online platform-based financial intermediary services to help enhance consumer convenience and facilitate digital innovation and to (b) make improvements to the operation of the financial regulatory sandbox program. The key measures include the following. a) Support balanced growth of platform-based financial services in financial industry - (Financial Institutions) Pursue regulatory reforms to enable consumers to use a variety of financial and non-financial services such as banking, insurance, card, securities, etc. through platforms (integrated apps) designed by financial institutions - (Fintechs) Pilot operation of services (through financial regulatory sandbox program) that can offer comparisons and recommendations on various financial products including loans, savings, insurance, peer-to-peer (P2P) lending, etc. through a single platform - (Minimizing Negative Impact) Prepare safeguards against the negative effects of platform-based services by ensuring fairness in algorithms, preventing mis-selling, requiring sufficient provisions to be set aside for damage compensation, preventing anti-competitive behaviors of big tech platform companies. Out of 36 specific financial regulatory reform initiatives, #8: Promoting health care related services offered by insurance companies, #9: Improving rules to introduce digital universal banks, #10: Reviewing introduction of online platform-based financial intermediary services, and #11: Promoting card companies platform business b) Upgrade the financial regulatory sandbox program so that it can continue to play the role of facilitating financial innovation - Make early notification available to those that have been designated as innovative financial service providers about whether a regulatory change will be introduced or not prior to the termin
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Aug 17, 2022
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Aug 04, 2022
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Jul 19, 2022
- FSC Holds Kick-off Meeting on Financial Regulatory Reforms
- The FSC launched a financial regulatory reform committee, composed of 17 private sector participants with expertise in economics, finance, digital, law, and media sectors, to push forward financial regulatory reform initiatives through a private-public cooperation. At its kick-off meetingheld on July 19, the committee appointed Bahk Byung-won, former honorary chairman of the Korea Enterprises Federation (KEF), as committee chairman and discussed directions for financial regulatory reforms. Summary of FSC Chairmans Opening Remarks In his opening remarks, FSC Chairman Kim Joo-hyun emphasized the need for financial regulatory reforms in response to the reshaping of the financial sector and technological changes caused by digital transformation and a blurring of the barriers across sectors (called a Big blur phenomenon). In order for the financial sector to play a key role in economic growth as an independent industry, Chairman Kim called for bold reforms of financial regulations. The financial regulatory reforms, he said, are aimed at creating a new playing field to produce a success story, like a globally-renowned K-pop group BTS, in Koreas finance, in which new players originating from Koreas financial sector would be leading global markets. With financial regulatory reforms, the government will (a) support financial companies, regardless of whether they are online or offline businesses, to grow into global players; (b) create an environment to promote digital innovation for both financial companies and big tech; and (c) allow domestic financial companies to enter businesses, in which global financial companies are allowed to operate. All existing regulations will be reexamined on a clean slate. Chairman Kim stressed the importance of working together principle with various stakeholders from different sectors including industries, academics and media, and asked the financial regulatory reform committee to examine and discuss financial regulatory reform proposals from
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Jul 07, 2022
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Jun 29, 2022
- One-stop Lost Credit Card Reporting Service Available from Account Info Mobile App from June 29
- The FSC announced the availability of the one-stop integrated lost credit card reporting service from a mobile application called Account Info from June 29 through which financial consumers using credit cards from different issuers can simply access the app to submit lost reports at once. Background Along with the Credit Finance Association and the payment card industry, the FSC has been operating a one-stop integrated lost credit card reporting service to protect card users.As of now, the one-stop integrated lost credit card reporting service is available at credit card companies through their mobile apps or websites, and the total number of lost card reports reached some two million until the end of December 2021. To help accommodate such wide usage of the one-stop integrated lost credit card reporting service and to improve service access and convenience for financial consumers, the authorities have been working to expand the availability of one-stop integrated lost credit card reporting service to the Account Info mobile app. Key Details From June 29, the one-stop integrated lost credit card reporting service is available on the Account Info mobile app. Within the Account Info mobile appthat provides one-stop integrated search and management of a users all financial account and card information, a new One-stop Lost Card Report function will be added under the menu My cards at a glance. On the Account Info app, users can (a) check which cards they are currently using, (b) choose the cards they want to report as being lost and (c) submit a lost report. With the reduction in time and process for submitting lost reports, it is expected that this service will improve consumer convenience and help lower the amount of damages resulting from lost or stolen cards. Lost reports for credit, debit or family cards issued under the same name as the person filing the lost report can use this service (corporate cards excluded) and this service can be used from overseas as well.
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Jun 20, 2022
- 2022 Korea Fintech Week to be Held in September
- The FSC announced that the 2022 Korea Fintech Week, a global fintech exhibition, will be held from September 28 to 30 this year in cooperation with relevant institutions. With the availability of both offline and online participation, the Korea Fintech Week will help accelerate innovation in the fintech industry. (Offline) Three days of fintech IR events, investor consultation, job mentoring, fintech-themed seminars will help with investment promotion and employment opportunities. (Online) Exhibition halls, learning programs, experience programs and seminars will be operated online through metaverse. For participation in exhibition halls, idea contest, IR competition and investment consultation, please see detailed information below. Overview of 2022 Korea Fintech Week (Theme) Fintech, Tearing Down Barriers in Finance The 2022 Korea Fintech Week will be operated so as to help expand and replicate the innovation and growth of the fintech industry in close cooperation with relevant institutions. (Program) Offline and online events will be held simultaneously. a) (Offline) The 2022 Korea Fintech Week will provide a variety of venues for fintech firms, investors, relevant institutions and the public to come together through seminars, consultations, exhibitions and other standing programs. - (Opening Ceremony) Sharing outcomes of the fintech policy and presenting policy direction for innovation. - (Seminar) Seminars organized around specific fintech areas such as blockchain, data, etc. - (Investment) Providing opportunities for fintechs to attract investment through fintech IR, investment consultation, etc. - (Exhibition Halls) Introducing fintech services launched by fintech businesses and financial institutions. - (Programs for Participation) Providing an opportunity for prospective entrepreneurs to pitch ideas about fintech business models through idea contest and mentoring and giving fintech jobseekers a chance to have consultation. b) (Online) Various online program
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May 27, 2022
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May 11, 2022
- FSC Approves Registration of Three P2P Financing Firms and Informs Users to Practice Caution
- The FSC approved on May 11 the registration of The Asset Fintech Co., TGS Finance Co. and Ontwoin Co. for the operation of online investment-linked financial businesses (peer-to-peer or P2P financing business) as they satisfied the registration requirements specified under the Act on Online Investment-linked Financial Business and Protection of Users (the Act hereinafter). With the addition of three more entities, there are currently 47 registered P2P financing firms in total. For businesses that have already submitted their applications for registration, the FSC will promptly make decisions on their application review, and for those that have shown a potential of business closure, the authorities will seek measures to prevent damage to users. The FSC also said that users need to practice caution when using P2P financing and should beware of the following factors. First, users should note that there is no guarantee on principal investments and should refrain from investing in businesses that promise excessive rewards or have a record of lending excessive amounts to the same borrower. Second, borrowers need to check whether the interest rate and fee levels are in line with the maximum legal lending rate of 20 percent per annum which had been lowered since July last year. Registration of P2P Financing Business On May 11, three more business entitiesThe Asset Fintech Co., TGS Finance Co., and Ontwoin Co.have registered as P2P lending businesses with the FSC as they met the registration requirements specified under the Act. The registration of P2P lending firms under the Act is expected to help provide an enhanced level of protectionsfor P2P financing users and contribute to the improvement of credibility and sound developmentof the P2P financing industry in the future. Note for User Caution A. For Investors (No Guarantee on Principal Investments) P2P loans are highly risky products and do not guarantee collection of investments. When a borrower defaults on a loan, loss
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Apr 27, 2022
