Park Jae-hyuk is a seasoned journalist who has provided comprehensive coverage of South Korea's corporate dynamics, economic policies, industry challenges and the global positioning of Korean companies. Based on the articles he has written since joining The Korea Times in 2016, his investigative approach has helped readers understand corporate governance, economic trends and business strategies shaping South Korea’s economy.
'Unlicensed' Naver becomes threat to brokerages
Information about foreign stocks are seen on Naver's mobile app. / Courtesy of Naver
By Park Jae-hyuk
By Park Jae-hyuk
Naver is apparently frightening small- and medium-sized securities firms here with its continuous attempts to strengthen its investment related services, according to industry officials, Wednesday.
While the local brokerages fear they could become subordinate to the IT giant, the tech firm has avoided strict financial regulations as it does not have a brokerage license, using its platform and data to attract retail investors here.
Starting Aug. 11, Naver's mobile app has offered business information on Apple, Tesla and 22,000 other stocks listed on the U.S. Chinese, Japanese, Hong Kong and Vietnamese stock markets. It plans to offer information on European stock markets in the near future.
In collaboration with global research firm Morningstar, Naver will also offer forecasts for about 150 major stocks on U.S. markets.
It has continued to provide retail investors with various services, including message boards for shareholders of listed Korean firms. However, analyses of foreign stocks for Korean investors was previously provided by domestic securities firms' home trading systems, their research centers and foreign mobile apps, such as Investing.com.
Naver's latest enhancement of its services has coincided with the growing popularity of investing in stocks ― including foreign offerings ― after the market became volatile in the aftermath of the COVID-19 pandemic.
“We will offer in-depth analyses of foreign stocks, in addition to their price information, so that we become a valuable investment guide for our customers,” a Naver official said.
Through its Naver Pay mobile payment service, the tech firm has allowed its users to check brokerage accounts they hold, if they have registered their accredited certificates on the Naver website. The users can also categorize their assets according to their accounts and stocks.
In addition, Naver's mobile app notifies its users when their stocks reach target prices they have set ― if they want to trade them, they can directly connect to brokerage firms' mobile trading systems they use through the Naver app.
Industry officials regard Naver's recent moves as part of its attempts to become the leading fintech company in the securities sector without acquiring a brokerage license. In contrast to Naver, its rival Kakao received a brokerage license to launch Kakao Pay Securities.
After launching Naver Pay in 2015, Naver spun it off as Naver Financial in November last year. Since then, Naver has carried out various brokerage-related businesses in collaboration with Mirae Asset which acquired a 30 percent stake in Naver Financial through an 800 billion won ($675 million) investment.
Although Mirae Asset said it would focus on creating synergy effects through its collaboration with Naver, small- and medium-sized brokerages have been concerned about being left behind by the tech giant.
“Domestic securities firms may compete with each other to be chosen as Naver's partner,” a local brokerage firm official said on condition of anonymity.
Amid growing concerns, the financial authorities decided to organize a consultative body on the coexistence of big tech, fintech and conventional financial firms.
“Between late August and early September, we will form an organization comprised of representatives from financial firms, fintech firms, financial regulators and academia,” Financial Services Commission Chairman Eun Sung-soo said, Aug. 12.