Bo-eun leads the digital content team. She has covered foreign affairs, North Korea, tech, economy and gender issues at The Korea Times. She did a short stint at the South China Morning Post in Hong Kong, where she obtained a new perspective on news production and life. Small sources of joy for her are lounging in the sun, having a good latte and swimming.
Toss, Kakao Bank come under first FSS inspection
Toss' headquarters in southern Seoul / Korea Times file
By Kim Bo-eun
By Kim Bo-eun
Financial authorities are conducting their first inspection of Korea's leading fintech firms which are experiencing rapid growth. The audits will likely focus on internal control systems and risk management capabilities.
According to the Financial Supervisory Service (FSS), the authority is launching its first inspection of the financial services platform Toss this week. The FSS is set to inspect the internet-only Kakao Bank in the fourth quarter of this year.
The supervisory agency will look into Toss' security and financial conditions and check for any violations of the law governing e-transactions.
Toss, established in 2015, started off offering mobile money transfer services. It has now grown into a platform offering 40 types of services. Using the platform, users can make payments, sign up for credit cards and insurance policies and make investments. Toss has 17 million users.
Toss recorded its first surplus in the second quarter of this year, posting an operating profit of 1.7 billion won.
This is the supervisory authority's first comprehensive inspection of Toss. The FSS looked into Toss after it saw payments made with stolen customer data in June. Authorities concluded this was not a cybersecurity breach, but concerns grew over the platform's ability to detect suspicious transactions.
Meanwhile, the FSS will likely look into Kakao Bank's risk management capabilities.
Kakao Bank, established in July 2017 as the country's second internet bank, now has over 24.4 trillion won in assets. This compares to 5 trillion won in assets Kakao Bank held when it was launched.
Its unsecured loan balance exceeds 14 trillion won, which is larger than the unsecured loan balance of the six provincial banks added up. The lender has extended over 600 billion won in loans for mid- and low-credit holders.
Kakao Bank's net profit for the first half of this year came to 45.3 billion won, a 372 percent surge from the same period of a year earlier. Users of the lender's services have grown to over 12 million.
Kakao Bank's capital adequacy ratio stands at 14.03 percent as of the end of June. This is slightly above financial authorities' recommendation of 14 percent. The lender's delinquency rate is 0.22 percent.
Kakao Bank received a three-year grace period on FSS inspections following its launch.
The FSS has resumed audits of financial firms after they were suspended in the first half of the year due to COVID-19.