Press Releases - Financial Services Commission

Press Releases

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Jun 03, 2021

FSC Announces Analysis on Stock Markets with Partial Resumption of Short Selling

With the partial resumption of short selling being in place for about a month, the FSC announced an analysis on stock market trends for the period of May 3 to June 2. During this period, stock prices moved in a similar pattern as global stock markets while domestic stock prices showed relatively stable movements compared to other markets. Although the average daily amount of short selling transactions rose somewhat, it appears that there exists no significant relationship between short selling and stock prices for the given period. The FSC and other relevant institutions will continue to closely monitor market trends while working to bring about transparency and fairness in the markets. Stock Market Trends As of June 2, KOSPI and KOSDAQs closing prices were up 2.4 percent and down 0.2 percent, respectively, compared to April 30, the last trading day before the partial resumption of short selling began. In May, global stock prices showed mixed trends with the possibility of tapering by the Fed amid price increases in the U.S. Asian stock markets moved in the same direction as global stocks while domestic stock markets showed relatively stable trends as corporate earnings improved and retail investors remained net buyers. In May, foreigners net sold KRW9 trillion but turned to net buying in the last week of the month. Due to concerns about a monetary tightening from the U.S., other Asian markets also experienced foreign outflows. Short Selling Trends During the one-month period from May 3 to June 2, the average daily amount of short selling transactions increased somewhat to KRW688.2 billion. However, considering the fact that the total transaction amount increased more than twice the level seen before the partial resumption of short selling began, the growth is not that considerable.Also, as the built-up demand for short selling begins to fade out, the growth in the amount of short selling transactions also shows a downward trend toward stability. During the one-mont
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Jun 02, 2021

Authorities Introduce Operational Guideline on the Suitability and Appropriateness Test for Investors

The FSC introduced an operational guideline on the suitability and appropriateness test for investors which will be put up for public notice from June 3 to June 22. Background Financial institutions selling investment products to customers are required to carry out a suitability and appropriateness test for investors based on the information provided by customers in order to sort out investment products that are considered to be inappropriate for them. With the Financial Consumer Protection Act taking effect in March this year, certain changes have been made to the suitability and appropriateness test. First, the scope of investor information that needs to be checked by financial institutions as well as the standards for the measurement of investors risk appetite and tolerance have become legally mandated through the Act.Second, financial institutions have become subject to monetary penalties if their employees are found to have engaged in fabrication of consumer data or evaded the duty to conduct a suitability and appropriateness test. However, in implementing the Financial Consumer Protection Act, certain aspects of the suitability and appropriateness test have been identified as sources of inconvenience for consumers. As such, the authorities have prepared an operational guideline to help remove the inconvenience and improve the sales process. Key Details of the Guideline I. General Principles a) The seller should explain to consumers the purpose of carrying out a suitability and appropriateness test in an easy-to-understand manner and clearly indicate to consumers what kinds of information are being requested. b) The suitability and appropriateness test for investors should be carried out in a consistent manner according to the standards prescribed by the relevant laws. c) The test results should be stored and maintained along with the justifying documents. II. Online and Onsite Test Use For consumers who have already obtained their suitability and appropriatene
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May 31, 2021

Authorities to Ease LTV Rules and Enhance Support for Rent to Help Strengthen Housing Ladder

The FSC announced its plan to ease the loan-to-value (LTV) rules on mortgage loans and expand support for rent payments while taking steps to ensure an effective implementation of the household debt management plan introduced on April 29.The following measures are aimed at expanding financial support available to lower income households as well as young adults and newly married couples who are in actual need of housing. I. Mortgage Loans a) The non-homeowners annual income qualification to be given a preferential consideration will be increased from the current level of KRW80 million to KRW90 million for married couples and from KRW90 million to KRW100 million for first-time homebuyers. b) The maximum value of homes for which the annual income qualified individuals may apply will be increased from the currently level of KRW600 million to KRW900 million for homes located in overheated speculative areas and from the current level of KRW500 million to KRW 800 million for homes located in the areas that are subject to price adjustments. c) The additional benefit of maximum 10 percentage points in LTV ratio will also be increased to maximum 20 percentage points. II. Support for Vulnerable Groups a) For young adults, the maximum loan amount available for rent deposit will be increased from KRW70 million to KRW100 million per borrower through a housing guarantee program offered by the Korea Housing Finance Corporation. b) The maximum jeonseamount for which jeonse loans can be issued with a housing guarantee provided by the Korea Housing Finance Corporation at low interest rates and fees will be increased from KRW500 million to KRW700 million for Seoul metropolitan areas and from KRW300 million to KRW500 million for other regions. The maximum amount of jeonse loan a household can receive will remain at the same level of KRW220 million. c) The maximum loan amount available per borrower for long-term mortgage loan offered by the Korea Housing Finance Corporation for homes val
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May 31, 2021

Tech Financing from Banking Sector Continues to Rise for Innovative SMEs

The FSC announced the tech financing performance of banks for the second half of 2020. Among large-sized banks, the IBK and KEB Hana bank raked high, while Kyongnam and Busan Banks showed outstanding records among small-sized banks. The result of banks tech assessment capability also shows that the total number of banks that have completed setting up their own tech credit evaluation systems and are fully capable of extending loans based on their own tech credit assessment also increased to nine as one more bank joined the rank. Tech financing has become an important channel to raise funds for innovative SMEs that have technological prowess and future growth potential. Since its introduction in January 2014, the outstanding balance of tech financing loans continued to rise to KRW266.9 trillion as of the end of 2020.With active participation from the banking sector, tech financing has become widely in use. More recently, tech financing has moved into intellectual property and movable asset-based lendingas well. The authorities plan to work on making improvements to the tech financing system to continue to provide support for innovative SMEs. To improve consistency and credibility of tech credit evaluation systems between banks and TCBs, the authorities will help establish a standardized tech evaluation model during the second half of this year. The authorities also plan to gradually phase in tech credit evaluation into a comprehensive credit rating model for businesses. * Please refer to the attached PDF for details.
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May 31, 2021

Open Banking Available from Credit Card Companies

The FSC announced that open banking service will be available from mobile applications of major credit card companies starting from May 31. Shinhan, KB Kookmin, Woori card companies will make their open banking services available from May 31, with Lotte, Samsung, Hyundai and Hana card companies expected to join from June to August this year. Open banking was launched in December 2019 and has become widely in use. It has attracted some 80.2 million users cumulatively with more than 146.6 million accounts registered as of May 24, 2021. With credit card companies now offering open banking services, consumers are able to check their account balances and make mobile money transfers by using mobile applications of credit card companies while checking their monthly credit card usage on a banking application. Credit card companies will need to offer a more integrated financial service platform that provides the function of balance inquiry and mobile money transfer beyond their traditional payment-related services. In a similar vein, banks will now be able to develop a more customer-oriented business model that offers analysis on spending patterns, etc. Beyond open banking, the FSC will pursue open finance, a mutual opening up of finance-related services by financial sectors and fintechs through standardized mechanisms. The authorities will continue to work on making improvements to open banking by exploring potential links to new services and other industries and seeking ways to expand open banking services and its functions. * Please refer to the attached PDF for details.
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May 29, 2021

FSC Chairman Delivers Opening Remarks at the Green Finance Special Session of P4G Seoul Summit

FSC Chairman Eun Sung-soo delivered opening remarks at the special session on green finance held on May 29. Please see below for the full text of the speech. I. Introduction Good evening, everyone. Good afternoon, Europe. Good morning, America. Welcome to the 2021 P4G Seoul Summit Special Session on Green Finance. The world is still in the midst of the Covid-19 crisis. Covid-19 is not an individuals problem, nor a regions or a countrys problem. It is the whole humanitys problem. Likewise, climate change is everyones problem. In this regard, P4G puts emphasis on the value of partnerships across all sectors. I hope P4G Seoul Summit can induce everyone to take part in climate action. II. Why Green Finance? Achieving carbon neutrality involves a fundamental restructuring of industry. This might require trillions of dollars across the world. Many countries including Korea, have announced large-scale fiscal stimulus under Green New Deal schemes. However, public finance alone cannot cover the scale of investment we need. MDBs and private sector investors need to get involved as well. In a different angle, the financial industry can induce companies to lessen their environmental impact by altering the lending or investing criteria. For example, BlackRock, the worlds largest asset manager, evaluates a companys ESG performance when making an investment decision. III. Progress of Green Finance Green finance has been rapidly taking root in the global financial market over the past years. By the end of 2020, around 3,000 institutional investors have joined the UN Principles for Responsible Investment. Globally, ESG fund assets are nearing $2 trillion. Also, quarterly issuance of green bonds has risen to $150 billion. South Korea is also actively stepping up efforts to promote green finance. Last year, the government pledged to double the share of funding for green projects in public financial institutions by 2030. We are also planning to gradually make ESG data disclosures manda
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May 28, 2021

Government to Strengthen Oversight on Virtual Asset Transactions and Improve Transparency

The government announced its plan to enhance supervision on virtual asset transactions at a taskforce meeting led by the Office for Government Policy Coordination on May 28. The measures introduced are aimed at strengthening efforts to prevent illegal transaction activities and improving transparency amid growing market size of virtual assets. The taskforce meeting also assigned specific tasks for each government authority and agency dealing with virtual asset transactions. With the revised Act on Reporting and Using Specified Financial Transaction Information providing a six-month grace periodfor current virtual asset service providers (VASPs) to register their business with the authority, the government will ensure an effective management over the registration process as well as ensuing risks both during and after the grace period. Key Measures I. Preemptive management during the grace period In order to encourage prompt and early registration from existing VASPs, the financial authorities will provide consulting on the registration and supplemental requirements, such as obtaining an ISMS certification, opening up a real-name checking account, etc. The KoFIU will promptly process applications for business registration as they come in to promote market reorganization with registered entities. To let market participants know in advance and help them prepare for the possibility of business closure, the authorities will let the public know the status of business applications being filed through relevant websites. The authorities will continue to share information about VASPs with the investigative authorities to help enhance the effectiveness of necessary investigations. As of May 20, about sixty VASPs appear to be in operation. Twenty entities have received ISMS certifications and four them are found to run their operation with real-name accounts as of May 27. The authorities will continue to closely monitor fraudulent activities by VASPs and ensure strict response.
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May 27, 2021

FSC to Host Special Session on Green Finance at the 2021 P4G Seoul Summit

The FSC will host a green future session on the topic of green finance at the 2021 P4G Seoul Summit at Dongdaemun Design Plaza on Saturday, May 29, from 20:00 to 22:00 (Korean Standard Time). The special session on green finance will be available for online live streaming for anyone who is interested in watching via official websites of the 2021 P4G Seoul Summit, FSC and their YouTube channels. The special session will feature discussions on the role of finance in fostering green recovery in the post-COVID-19 era. Speakers and panelists will include foreign dignitaries and experts from climate and finance-related international organizations and institutions, such as the UNFCCC, WEF, IFC, BIS, EIB, TCFD, GCF, GGGI and SP. FSC Chairman Eun Sung-soo will deliver opening remarks through which he will offer an outlook on the future tasks of global green finance efforts while calling for close cooperation from financial sectors across the globe to achieve carbon neutrality. In particular, Chairman Eun will introduce Koreas green finance policies that have been actively pursued by the government as it announced the 2050 carbon net zero goal last year. The special session on green finance will shed a new light on the important role of finance in responding to climate change. It will also help raise domestic financial sectors interest and participation in green finance efforts. For more details about the program, please see the attached reference material. * Please refer to the attached PDF for details.
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May 27, 2021

Internet-only Banks to Increase Credit Lending to Individuals with Mid to Low Credit Standings

The FSC announced a plan to boost internet-only banks credit-based lending to individuals with mid to low credit backgrounds from KRW2 trillion at the end of 2020 to about KRW4.6 trillion by the end of this year. Internet-only banks will gradually expand the proportion of their credit-based lending to those with mid to low credit standings with a goal of reaching more than thirty percent of their total balance of credit-based lending by the end of 2023. Internet-only banks will also seek to further improve their credit scoring systems to more properly evaluate individuals debt service capabilities based on more realistic customer data as well as alternative credit data. In this regard, the government will strengthen management and supervision over internet-only banks to ensure their implementation of the plan. * Please refer to the attached PDF for details.
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May 26, 2021

FSC Plans to Improve Rules to Promote Big Data Analytics in Financial Sectors

The FSC announced its plan for improving rules on data convergence of anonymized and pseudonymized data in financial sectors on May 26 with an aim to further promote big data analytics in financial sectors. With the revised Credit Information Use and Protection Act taking effect on August 5, 2020, data convergence through big data analytics became possible through one of the four government-designated data specializing institutions. As of May 25, 2021, 41 cases of data convergence have been completed on 111 pieces of data by data specializing institutions. A total of 46 financial and non-financial companies have participated by providing their data and 35 companies have received the converged data for analysis and use. The converged data are being used for developing more convenient financial services for diverse types of consumers, introducing new technologies and services and more closely analyzing policy outcomes and improving policies. Against this backdrop, the FSC plans to work on the following measures to further advance big data analytics in financial sectors. Key Measures First, the FSC plans to increase the number of designated institutions that specialize in data convergence in the second half of this year to make it possible the provision of more specialized data convergence services and open up more types of data from businesses and public institutions. Second, the FSC plans to ease some of the restrictions placed on data convergence between a data specializing institution and a third party entity. Currently, data convergence between data stored at a data specializing institution and that provided by a third party is only permitted when the converged data is for use by a third party under the condition that there is no potential conflict of interests in using the converged data. The FSC plans to ease this restriction to allow data convergence and use by the same entity in a way that still prevents conflicts of interests. Third, the Credit Information Us
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May 26, 2021

2021 Korea Fintech Week

The 3rd Korea Fintech Week will be held virtually as well as off-line from May 26 to 28. The three-day event will feature off-line sessions including an opening ceremony, IR meetings and idea contests, and online exhibitions. The off-line events will be live streaming via www.fintechweek.or.kr/2021. (Offline Sessions) Off-line sessions will start with an opening ceremony at 10 am on May 26, providing opportunities for fintech businesses to share fintech trends at home and abroad, showcase innovative fintech services and attract investments. In his welcoming remarks, FSC Chairman Eun Sung-soo introduces Koreas progress in fintech policy and future plans. Regulatory reforms enabled new data business such as MyData and the rollout of 82 innovative financial services for two years via the financial regulatory sandbox. The government will continue its efforts to boost fintech growth and digital innovation in finance by allowing fitech startups to operate D-testbed and easing regulations on financial institutions to facilitate their investment in fintech businesses. Chairman Eun emphasizes that financial stability is as important as innovation and pledged to enable more people to share the outcomes of financial innovation more safely. The opening ceremony also features congratulatory remarks by Yoon Kwan-seok, Chairman of the National Policy Committee and Zhou Liang, Vice Chairman of China Banking and Insurance Regulatory Commission; and keynote speeches by Michael Danagher, Canadian Ambassador to Korea and James Kim, Chairman CEO of AMCHAM Korea. (Online Sessions) Online events and exhibitions will be available from 10 am on May 26 at www.fintechweek.or.kr/2021. The online expo offers virtual booths, virtual one-on-one meetings between fintechs and investors, and online job fair, etc. (Special Session on Green Finance) This years Fintech Week features a special session on green finance both online and offline to promote the 2021 P4G Seoul Summit scheduled for May 30-31.
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May 25, 2021

Government Approves Revised Rules to Introduce Small-sum & Short-term Insurance

The government approved the revisions to the Enforcement Decree of the Insurance Business Act at a cabinet meeting on May 25, aiming to introduce a small-sum, short-term specialized insurance business with a variety of insurance coverage such as pet, leisure and travel insurance. Key Revisions (Small-sum Short-term Insurance Business) The minimum capital requirement for a small-sum, short-term specialized insurance business will be set at KRW2 billion. They are allowed to provide various types of insurance coverage e.g. pet insurance, leisure travel insurance, weather insurance, etc with a one-year renewable term and premiums of up to KRW50 million. The insurers annual gross premium revenue will be capped at KRW50 billion. (Scope of Insurers Subsidiaries) To promote digital transition in the insurance sector, the revision permits insurers to own more than a 15% stake in a healthcare or MyData service provider as subsidiaries. (Access to Administrative Information) Currently, insurance policy holders are required to submit required administrative documents such as a copy of residence registration, family relation certificate, drivers license, etc, to insurers. To ease such a burden, the revision will allow insures to access to administrative information upon policy holders consent. (External Evaluation of Policy Reserves) Insurance businesses with total assets of KRW1 trillion or more will be required to have external actuaries approve the appropriateness of their policy reserve. Schedule The revisions will take effect from June 9, 2021. The FSC will complete revisions to subordinate rules including the Regulation on Supervision of Insurance Business in accordance with the revised Enforcement Decree. * Please refer to the attached PDF for details.
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May 25, 2021

Government to Work on Improving Financial Consumer Education

Vice Chairman Doh Kyu-sang presided over the 1st consultative body meeting on financial education virtually held on May 25. The consultative body, which had been operated on a voluntary basis from 2007 to 2020, turned into a statutory organization with the enactment of the Financial Consumer Protection Act taking effect from March 25, 2021. At its first meeting, chaired by FSC Vice Chairman, the consultative body discussed and approved basic principles for improving financial consumer education and detailed plans. Key Discussions (Operation of the Consultative Body) Under the Act, the consultative body is composed of government officials from eight relevant ministries and deputy governor of the FSS. However, it will be attended by private sector experts from consumer groups, research and education institutions. The consultative body will hold its regular meeting bi-annually in June and December. It may hold irregular meetings, if needed. (Financial Education Plan for 2021) The government will strengthen online education infrastructure and programs to ensure the uninterrupted financial education under the Covid-19 circumstances. Relevant institutions will work together to develop effective and creative materials to boost public awareness of the Financial Consumer Protection Act. (Role Assignment among Financial Education Institutions) Financial consumers are categorized into groups according to their lifecycle and specific circumstances, For each group, a responsible education institution will be assigned. Responsible institutions will be asked to submit evaluation reports and plans on financial education for each group to the consultative body in December every year. (Certificate for Educational Content) Financial education institutions will jointly review education content on the basis of its appropriateness, accuracy, delivery and fairness. Qualified content will be granted a certificate, which is subject to reassessment every one or three years. (Certificate for
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May 24, 2021

Financial Authorities and Relevant Institutions Declare Support for TCFD and Its Recommendations

The FSC along with thirteen other relevant institutions announced their official declaration of support for the Task Force on Climate-related Financial Disclosure and its recommendations on May 24. The declaration was followed by the green finance consultative bodys kick-off meeting chaired by Vice Chairman Doh Kyu-sang. Vice Chairmans Remarks Last year, the average temperature in Europe and Asia reached a record high in 111 years according to the Global Climate Report 2020 by the U.S. National Oceanic and Atmospheric Administration. Considering ripple effects of climate change on the stability of financial systems, the financial sector should preemptively take a responsible role in global issues such as the climate change. Recently, the EU has introduced green taxonomy which provides standards on support for green industries. The Biden administration in the U.S. has strengthened its climate leadership by rejoining the Paris Agreement and holding a Leaders Summit on Climate. The Korean government, too, declared the 2050 carbon net zero goals and enhanced its carbon reduction objectives while suspending state-backed financial institutions financing of overseas coal plants. With the K-New Deal initiative, the government has been expanding investments in green sectors as well. (Support for TCFD and its significance) The financial authorities plan to boost cooperation with the international society to more actively respond to climate change. Last week, the FSC and FSS applied for membership to the Network of Central Banks and Supervisors for Greening the Financial System. Today, the FSC and thirteen relevant institutions are here to announce official declaration support for the TCFD. The TCFD is a global consultative body created to promote climate-related financial disclosures. In 2017, the TCFD introduced its recommendations and more than 2,000 institutions from 78 countries across the globe have shown support for the TCFD and its recommendations. In Korea, a total of
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May 24, 2021

FSC Holds Policy Workshop to Discuss Progress of Policy Implementation and Tasks Ahead

The FSC held a policy workshop on the progress of financial policy implementation of the Moon Jae-in administration at its fifth year on May 20, discussing some of the key policy achievements made in the past four years as well as the remaining tasks. The policy workshop was attended by all FSC employees and key members of the financial development review committee. Policy Achievements I. Preemptive crisis response helped to ease uncertainties and ensure stability a) Prompt implementation of COVID-19 response measures helped to prevent a spread of financial crisis. - The KRW175 trillion-plus COVID-19 financial support programs introduced, which include (i) stronger lending support for SMEs and small merchants hit by COVID-19, (ii) emergency liquidity support for businesses facing temporary liquidity shortages and (iii) the bond market and stock market stabilization funds. b) The growth of household debt has been stably managed. - Mortgage rules tightened to curb speculative demand in the housing market (Aug. 2, 2017) - Stronger mortgage rules applied on multiple homeowners to cool down speculative demand (Sep. 14, 2018) - Prohibition of mortgage loans introduced on homes valued over KRW1.5 billion in speculative areas (Dec. 16, 2019) - Gradual application of DSR rules introduced on individual borrowers (Apr. 29, 2021) c) Continuous efforts have been made on corporate restructuring - Corporate restructuring fund created in the amount of about KRW3.2 trillion between August 2018 and April 2021, which made investments of about KRW1.8 trillion so far - Pursued restructuring of maritime shipping and airline industries II. Encouraged a shift in flow of funds towards productive sectors through financial innovation and supply of venture capital a) Expanded the supply of funds to innovative sectors by making improvements to the corporate credit evaluation system and the capital market rules - Corporate credit rating system changed to take into account the future growth poten
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May 21, 2021

Revision to the Microfinance Support Act to Expand the Pool of Microfinance Funds

The National Assembly passed a partial revision to the Microfinance Support Act during its plenary session held on May 21. The revision will expand the types of financial institutions that are mandated by the law to make contributions to the pool of microfinance funds. Under the revised Act, all financial institutions that extend credit to households, such as banks, insurance businesses and specialized credit finance companies, will have to make contributions to the pool of microfinance funds managed by the Korea Inclusive Finance Agency (KINFA). Prior to the revision, mutual finance companies and savings banks were the only types of financial institutions that are subject to the contribution requirement. Specific contribution rates and procedures will be determined through lower regulations. The revised Act also improves the internal management and governance structures of KINFA to enhance efficiency in its management of dormant deposits while establishing a legal ground for the microfinance support center that is jointly operated by KINFA and Credit Counseling Recovery Service. The revised Act will take effect four months after promulgation. * Please refer to the attached PDF for details.
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May 21, 2021

Revised FSCMA to Simplify Business Approval Process and Promote Orderly Trading Activities

The National Assembly passed a partial revision to the Financial Investment Services and Capital Markets Act during a plenary session held on May 21. The revision is aimed at simplifying the business approval process for financial investment businesses and encouraging orderly trading activities in capital markets. For financial investment businesses, setting up additional business units in equivalent business areas will become easier as the approval process will be simplified to help improve efficiency in their business management. When registering an additional business unit, financial investment businesses will be exempted from submitting a business plan and proving the creditworthiness of major shareholders. The same standards will be applied to foreign companies when changing their operational status from a branch office to subsidiary or vice versa. The revised FSCMA also creates penalties of maximum five years of imprisonment or KRW200 million in monetary sanction for the act of brokering investors with investment account lending, while strengthening the rules of asset forfeiture on price rigging, etc. The revised FSCMA will take effect six months after promulgation. * Please refer to the attached PDF for details.
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May 20, 2021

FSC and FSS Apply for NGFS Membership to Strengthen Global Cooperation on Green Finance

The FSC and FSS applied for the membership to the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) on May 17 ahead of the 2021 P4G Seoul Summit scheduled to be held on May 30-31. The NGFS was launched in December 2017 with aims to contribute to the management of climate and environment-related financial risks and support implementation of sustainable economic development. As of May 2021, ninety central banks and financial supervisory institutions from seventy countries are members with fourteen international organizations also participating as observers. The NGFS discusses and deals with a variety of green finance-related issues, such as the supervisory measures on climate and environment-related financial risks, the impact of climate change on the macroeconomy and financial sectors and building relevant data on climate and environmental risks. By joining the NGFS, the FSC and FSS plan to actively participate in and contribute to the global discussions on green finance and enhance policy alignment of Koreas green finance strategies with global standards. With the 2021 P4G Seoul Summit scheduled for May 30-31, the financial authorities also plan to actively promote domestic financial sectors green finance efforts to global audiences. * Please refer to the attached PDF for details.
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May 17, 2021

FSC Announces Plan to Promote the Use of Digital and Contactless Insurance Sales Mechanisms

The FSC announced a plan to improve rules on insurance business in order to promote the use of digital, AI-based and contactless insurance sales mechanisms as part of the broader aim to boost consumer confidence and promote innovation in the insurance industry. Insurance sales channels face structure changes amid an expansion of contactless services and digital technologies, increasing number of platform businesses entering the market and the growth of general agencies (GAs). To improve the effectiveness of consumer protection while removing some of the inefficiencies observed in the current insurance sales practices, the authorities have prepared the following plan for changing the rules on insurance sales mechanisms. Key Details A. Face-to-Face Sales - Previously, insurance agents and brokers were required to meet customers face-to-face at least once to explain coverage details. However, with the telemarketing safeguard measures in place, such as the requirements for recording and confirmation by insurers, sellers are allowed to provide explanations via telephone calls. (rule change completed on Mar 25, 2021) - When subscribing for an insurance coverage using a mobile phone, customers faced the inconvenience of having to put their signature multiple times throughout the process. This electronic signature requirement will be reduced down to only once at the beginning of the subscription process to improve convenience. (further improvements expected within May 2021) B. Telemarketing - With the use of the text-to-speech AI-based technology, insurance agents and brokers will no longer have to read the entire sales script that usually took about thirty minutes to finish. With the AI-based voicebot, the salesperson is able to instead focus on answering questions from the customer and providing supplemental information. (implementation expected in Q3 2021) - Previously, telemarketing and mobile sales mechanisms remained two distinct sales channels. However, a hybrid sale
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May 13, 2021

Financial Development Review Committee Holds 1st Special Committee Meeting on Young Adults

The FSC announced that the financial development review committee launched an eighteen-member special committee on young adults made up of members in the age of twenties and thirties representing diverse areas of professions on May 13. At its kick-off meeting, the special committee on young adults held discussions on the issue of housing finance and the housing ladder. During his keynote address, FSC Chairman Eun Sung-soo spoke about the importance of maintaining close communication with young adults as the level of interest shown by young adults recently on financial markets and policies have grown significantly. As such, Chairman Eun pledged that the FSC will continue to listen closely to the needs of young adults to help improve conditions and minimize disadvantages for them. Throughout the year, the special committee will hold meetings and have discussions on a range of topics that are of concern to young adults, such as creating fairer conditions for stock investment, challenges of young adults as startup entrepreneurs, the electronic payment system and so on. * Please refer to the attached PDF for details.
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