Vice Minister of Knowledge Economy Ahn Hyun-ho, fifth from left, and Korea Post President Namgung Min, sixth from left, applaud along with other high-ranking Korea Post officials at a ceremony unveiling the postal service’s new logo at its office in central Seoul, Thursday. / Courtesy of Korea Post |
By Kim Tae-gyu
Staff reporter
Korean card issuers may soon break into a sweat as the country's monopolistic postal service with huge cash reserves and a nationwide network has decided to enter the credit card industry in the not-so-distant future.
Korea Post President Namgung Min disclosed the ambitious scheme during Wednesday's press conference held to celebrate the 10th anniversary of the postal service's privatization.
``Currently, we are not permitted to establish a card business. But for many ordinary people, we will take steps to make headway into the industry as we have a wide presence in places where credit card issuers are not present,'' Namgung said.
As the first step, the state-run agency plans to start with debit cards before eventually extending its horizons to credit cards.
As long as an account has a sufficient balance, a debit card can be issued to purchase things avoiding the use of cash or checks. The funds are be automatically withdrawn from the card holders' accounts.
However, people cannot buy items on credit with them.
The biggest stumbling block could be opposition from the card issuers since they don't want to compete with the giant agency with more than 3,700 branches across the country.
``Of course they would be opposed to the idea. Yet, in order to offer financial services to those in rural areas, Korea Post has to step up,'' Namgung added.
Plus, Namgung said that Korea Post would increase its riskier investments such as overseas assets, real estate or private equity funds, which promise higher returns. Thus far, it has invested 50 percent of its assets in bonds.
Currently, Korea Post has 44.3 trillion won ($36.2 billion) in deposits and the total assets of its insurance department amounts to 28.3 trillion won.
Korea Post has also changed its logo on the occasion of the 10th anniversary.
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'600만명 학살 지휘' 잔인한 인물의 뒷얘기 공개
