Value context and insight. lkm@koreatimes.co.kr
Financial groups enhance digital banking
By Lee Kyung-min
Major players forge ties with tech firms for digitization
By Lee Kyung-min
With digital competition building up in the financial sector, a growing number of financial services providers are forging strategic ties with tech companies.
The move is aimed at securing better access to innovative technologies and business models they are unable to develop in-house.
Korea's major financial groups are no exception. They are increasing efforts to team up with IT firms for digital banking in a bid to strengthen global competitiveness and commercialize the jointly produced digital platform, a new source of growth.
KB Financial Group and LG Group signed a memorandum of understanding Jan. 15 to jointly develop future digital technologies such as blockchain, artificial intelligence (AI), robots and internet of things (IoT).
Among many efforts to share knowhow and experience on technology and business, the two will first seek to set up infrastructure for providing blockchain-based services and develop products utilizing new technologies.
They will also form consortiums with other industry businesses including entertainment and retail to widen the scope of their business to better establish a new digital platform.
The two agreed that blockchain technology will help increase trust and expandability in various consortium businesses, while no plans are in place to use virtual coins due to their volatile nature.
This is in addition to many business projects involving payment services upgrades, automated insurance systems and new financial platforms.
Similarly, Shinhan Bank India CEO Oh Hyung-kwon and Mynd Solution COO Jacob Raphael signed a memorandum of understanding at the bank's office in India, Jan. 11.
Mynd Solution in India is a global service provider in business process and technology management, offering services in finance and accounting, human resource outsourcing and consulting.
The two agreed to boost cooperation following the launch of Shinhan's “digital factoring loan,” under which all procedures involving sales of corporate bonds transactions by companies in India will be conducted online.
In February 2018, Hana Financial Group signed a memorandum of understanding with Oracle Corp. in Singapore under which the two will share business knowhow and IT expertise to establish Global Loyalty Network (GLN), a key initiative led by group chairman Kim Jung-Tai.
GLN is an integrated platform network through which financial services firms, retailers and card point management firms are able to use shared digital platforms to exchange digitally convertible commodities including points and mileage.
The group had the first consortium with 36 companies in 11 countries in November 2017.
“Building a global digital asset sharing network requires a highly sophisticated innovation technology. Upon the completion of the global such integration platform, customers will be able to enjoy tightly integrated services without limitation or restriction,” a Hana official said.