Park Han-sol reports on Korea's financial regulators, along with fintech and insurance. She previously wrote about the art world, from biennales and exhibitions to fairs and auctions, with a focus on Seoul and the figures shaping the scene. Before joining The Korea Times, she spent a year at ABC News' Seoul bureau, contributing to coverage of major Asia-Pacific events.
Toss to face stricter oversight as Korea's first fintech financial conglomerate
Lee Seung-gun, founder and CEO of Viva Republica, which operates fintech platform Toss / Courtesy of Viva Republica
By Park Han-sol
Viva Republica, which operates Toss, is poised to become the first fintech company subject to the same regulatory framework as Korea's other large financial conglomerates, marking a major shift in oversight for the fast-growing platform.
Originally launched as a mobile money-transfer app, Toss has since rapidly evolved into a financial platform spanning banking, brokerage and insurance. Authorities are expected to formally designate the company as a “financial conglomerate” later this month.
Introduced in 2021, the system is designed to strengthen oversight of groups with multiple financial subsidiaries by requiring integrated supervision of intra-group risk and related-party transactions. Seven conglomerates — Samsung, Hanwha, Mirae Asset, Kyobo, Hyundai Motor, DB and Daou Kiwoom — are currently subject to the regulations.
To qualify, a group must operate across at least two of three sectors — banking, insurance and financial investment — with the smallest business holding more than 5 trillion won ($3.24 billion) in assets.
Toss qualifies through Toss Bank and Toss Securities. The latter’s assets surpassed 7.2 trillion won last year, well above the threshold, while Toss Bank held roughly 33 trillion won in assets.
The designation would subject the group to significantly tighter oversight. Among other requirements, it must maintain group-level capital adequacy standards designed to prevent risks at one affiliate from spreading across the group.
The company must also disclose details of its ownership structure, governance, internal controls and risk management, while related-party transactions exceeding 5 billion won will need board approval. Regulators can also require a management improvement plan if the group’s financial soundness deteriorates.
Industry observers have long argued that regulation has lagged behind fintechs’ rapid expansion into traditional financial services. As digital platforms have grown into systemically important financial providers, concerns have also risen that major service disruptions could spill over into the broader system.
The designation reflects the growing convergence between fintech platforms and established financial institutions. It also means Toss’ future expansion will have to be accompanied by more robust group-wide governance and internal controls.