Lee Min-hyung joined The Korea Times in 2014 and has worked as a journalist mainly in Korea’s finance, tech and automotive industry. He specializes in content creation, breaking news and in-depth analysis currently on transportation and mobility. You can reach him via mhlee@koreatimes.co.kr.
Regulator launches inspection into Toss
Financial Supervisory Service Governor Jeong Eun-bo speaks during a financial platform conference in Seoul, Jan. 26. Yonhap
By Lee Min-hyung
By Lee Min-hyung
The Financial Supervisory Service (FSS) has launched an inspection into Toss, as part of its on-site monitoring of financial firms this year.
Earlier, the watchdog shared its plan to step up its inspections of internet-only lenders and financial arms of the so-called platform giants such as Naver and Kakao, after they were mired in a series of controversies including personal data leakage and top executives' massive stock sales.
According to the financial industry, Toss, one of Korea's most successful fintech-only startups, became the first target for the FSS' occasional inspection this year.
The FSS will look into whether Toss operates its business by ensuring customer protection and abides by relevant financial regulations here. After the authority finishes the inspection of Toss, it plans to move onto companies such as Naver Financial and KakaoPay.
A key issue is whether the financial authorities need to impose less strict regulations on fintech firms, as tough regulations have long been cited as a major hurdle holding back growth of the nation's fintech ecosystem.
However, after influential big tech firms came under fire for a series of poor internal management incidents, calls have also grown that watchdogs should maintain a similar level of regulatory pressure on emerging financial players.
“It is unfair that watchdogs are not imposing the same regulations on big tech firms, as some of them take advantage of some regulatory ambiguity,” a financial industry source said. “This discourages conventional financial firms at a time when a growing number of their customers are switching to the emerging players, whose rapid growth was driven in part by less tough regulatory restrictions.”
Nevertheless, chances are that authorities could change their regulatory mindset after President-elect Yoon Suk-yeol takes office, as most of his pledges are centered on easing regulations and fostering overall industrial growth.
Both the FSS and Toss declined the opportunity to comment further on the matter.
The FSS announced earlier that it will conduct a total of 779 regular or occasional inspections on financial firms here throughout this year.