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| Financial Services Commission (FSC) Chairman Choi Jong-ku unveils some of its top priorities in 2019 at a press luncheon in Seoul, Wednesday. Courtesy of FSC |
'KakaoPay, Payco can be more like Alipay'
By Park Hyong-ki
The government will push forward to invite more internet banks here, and allow nonfinancial companies such as tech firms to provide overseas transactions and settlement services through their applications, according to the Ministry of Economy and Finance and the Financial Services Commission (FSC).
FSC Chairman Choi Jong-ku said Wednesday his organization will begin accepting applications from the private sector seeking to set up internet banks in March 2019.
Then, it will speed up the process for granting licenses to applicants by the end of May, he told the press in Seoul.
This comes as a revised law will take effect in January, enabling nonfinancial tech companies to exercise voting rights of up to 34 percent in internet banks, up from 4 percent.
Also, the government will further relax relevant rules to allow fintech companies such as KakaoPay and NHN Payco to provide services enabling users to settle their bills overseas while traveling abroad.
It will allow this beginning June 2019, according to the finance ministry.
Previously, nonfinancial companies were strictly forbidden from providing overseas transactions and settlement services.
Those using fintech apps had to pay their bills with credit cards overseas, unlike Chinese travelers who could settle payments using Alibaba's Alipay even in Korea. In short, it seeks to support KakaoPay and NHN Payco to be more like Alipay.
"One of our top priorities in 2019 is energizing fintech through deregulation," the FSC chairman said.
Also, companies such as Samsung Electronics' Samsung Pay will be able to provide an overseas wire transfer service via a strategic partnership with financial companies, beginning March 2019.
Samsung and Shinhan Bank have ties to build a mobile payment ecosystem in Vietnam, according to Shinhan Bank.
The FSC chairman added its other priorities are supporting the auto and ship parts industry, which is facing a downturn amid the rise of "smart" and eco-friendly cars worldwide.
"I understand the industry may have to restructure. But what those companies need to do is focus on boosting their research and development as the country is losing its edge in smart driving compared to other economies," Choi said.
Also, the government will push for the passage of a bill enabling less overnight of the capital market for medium-size companies and tech startups.
Through reduced red tape, it seeks to make it easier for them to raise capital to finance their business development, the FSC chairman noted.
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