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Card issuers face tough road ahead

Stickers show credit cards that can be used at a restaurant in central Seoul in this file photo. / Korea Times fileBy Park Jae-hyukThe nation's card issuers will suffer worsening profitability during the second half of 2019, due to the expected hike in their default rates and the planned return of transaction fees to small business owners, market analysts said Monday.The card firms have minimized revenue loss by cutting costs, in the face of the government's policy to reduce their transaction fees.Analysts, however, said the companies will face more difficulties in the second half, because of additional unfavorable factors waiting for them.During the first half of the year, the combined net income of the country's five card issuers ― Shinhan, KB Kookmin, Woori, Hana and Samsung ― was 709.6 billion won ($599 million), down 7.1 percent from a year earlier.Hana suffered the sharpest decline during the period, as it posted a 33.7 billion won net income, a 34.7 percent drop year-on-year.Kookmin posted a 146.1 billion won net income, a 12 percent decline from a year ago, and Shinhan posted

Aug 2, 2019By Park Jae-hyuk
Card issuers face tough road ahead

Kakao Pay tops mobile payment app ranking

KakaoPay CEO Ryu Young-joon / Korea Times fileBy Lee Kyung-min Kakao Pay, a mobile payment and digital wallet service by Kakao Corp., received the best customer satisfaction reviews among six mobile payment service providers in Korea, a government survey showed Friday. The Korea Consumer Agency (KCA) survey released Aug. 2 showed Kakao Pay received the best reviews among the six service providers. The remaining five were 11 Pay (currently SK Pay), SSG Pay, Naver Pay, Samsung Pay and Payco. The review criteria included service quality, service characteristics and likability. The study was conducted between May 13 and 19 on 1,200 service users. Regarding the overall satisfaction rate, on a scale of one to five, Kakao Pay scored 3.94, followed by 11 Pay and Samsung Pay (3.92) Payco (3.9) and SSG Pay (3.78).Kakao Pay was top-rated for its likability scoring 3.83, followed by Samsung Pay (3.77), Payco (3.76), Naver Pay (3.74) and SSG Pay (3.7).Samsung Pay received the best reviews for service quality scoring 4, followed by Kakao Pay (3.99), 11 Pay (3.95), Naver Pay (3.92), Payco (3.9) SSG

Aug 2, 2019By Lee Kyung-min
Kakao Pay tops mobile payment app ranking

Naver, Mirae Asset Daewoo form partnership in fintech

The Naver headquarters in Seongnam, Gyeonggi Province / YonhapBy Jhoo Dong-chanNaver and Mirae Asset Daewoo are set to form a partnership to expand their presence in the nation's fintech business, the firms said. Mirae Asset also promised to invest in the nation's largest online portal under the partnership. Kakao, operator of Korea's most widely used messenger app KakaoTalk, has dominated the nation's fintech businesses, but the synergy between the two firms is expected to emerge as a viable contender.Naver said it will carve its Naver Pay division up to establish a financial subsidiary by Nov. 1. Mirae Asset Daewoo also promised to invest 500 billion won ($423.3 million) to help Naver set up a comprehensive financial platform.“The firms are expected to create a great deal of synergy under the partnership,” said IBK Securities researcher Lee Seung-hoon. “They aren't likely to launch a banking business in the near future, but the partnership will create various opportunities in payment, insurance and loans. Online-based Naver Pay is expected to stretch its presence

Aug 1, 2019By Jhoo Dong-chan
Naver, Mirae Asset Daewoo form partnership in fintech

'Paying with face' now available in Korea

A Shinhan Card employee pays for a cup of coffee with the “Shinhan Face Pay” system at a coffee shop inside the card issuer's headquarters building in Seoul, Thursday. / Courtesy of Shinhan CardBy Park Jae-hyukFacial recognition-based payments, which have been widely used in China, are now available here.Shinhan Card said Thursday it has started running “Shinhan Face Pay,” a facial recognition-based payment system it demonstrated during the Korea Fintech Week 2019 event hosted by the Financial Services Commission in May.According to the card firm, its employees are able to make payments with the system at the cafeteria, coffee shop and CU convenience store inside the company's headquarters building.The employees can use the system after registering their credit card information and taking photos of their faces by using facial recognition kiosks at the headquarters.If they register their information, they can make purchases without credit cards or mobile phones, just using their faces, at every store equipped with the payment system.After running the system at

Aug 1, 2019By Park Jae-hyuk
'Paying with face' now available in Korea

Orange and Shinhan Life lead group's non-banking earnings

The Orange Life headquarters in Seoul / YonhapBy Jhoo Dong-chanOrange and Shinhan Life Insurance played an important role leading Shinhan Financial Group's non-banking sector earnings in the first half of the year.According to sources, Shinhan Financial Group's earnings from the non-banking sector grew 64 billion won ($54.1 million) in the first half, or 10.3 percent from a year ago. Orange Life, which newly joined the group by stake acquisition earlier this year, posted a 147.2 billion won net profit in the period. Shinhan Financial Group owns a 59.2 percent stake in Orange Life.Shinhan Life Insurance's net profit was 78 billion won in the first half, up 8 billion won from the same period last year.This was also in stark contrast to the disappointing earnings of the group's other non-banking arms such as Shinhan Investment and Shinhan Card.Shinhan Investment's net profit shrank 39.9 billion won, or 21.9 percent, while Shinhan Card's earnings were also down 10.6 billion won, or 3 percent.Shinhan Financial Group is considering securing the remaining stake in Orange Life. If the group

Jul 31, 2019By Jhoo Dong-chan
Orange and Shinhan Life lead group's non-banking earnings

KB joins hands with PLUG and PLAY to support domestic startups

KB Financial Group Chairman Yoon Jong-kyoo, left, shakes hands with PLUG and PLAY CEO Saeed Amidi at the platform company's headquarters in Sunnyvale, California, April. / Courtesy of KB Financial GroupBy Jhoo Dong-chanKB Financial Group has inked a strategic partnership with PLUG and PLAY to support domestic startups' entry to the global market, the financial group said Wednesday.Based in Sunnyvale, California, PLUG and PLAY is an early stage investor and corporate innovation platform running two programs per year in each industry and region. It now has 300 corporate partners and 200 venture capitalists in its ecosystem.Before the deal, KB Financial Group Chairman Yoon Jong-kyoo visited the PLUG and PLAY headquarters in California, April, to share the group's incubating system for fintech startups. Both parties have since interacted with each other to strengthen their ties.Under the deal, KB has been nominated as one of PLUG and PLAY's anchor members granted access to the firm's list of global industry-leading startups. It has granted investment in these firms and recommends startup

Jul 31, 2019By Jhoo Dong-chan
KB joins hands with PLUG and PLAY to support domestic startups

Low interest rate strains insurers, banks

gettyimagesbankBy Lee Kyung-min Insurers are coming under growing pressure to boost profits after the Bank of Korea (BOK) lowered its key rate July 18, a measure that has widened the spread between the rate they promised customers earlier and the one under which they borrow from the central bank.The BOK lowered its key rate to 1.5 percent, a 25 basis points cut from the previous 1.75 percent that had remained unchanged for seven months. The more “accommodative” measure aims to pre-emptively counter any fallout from the trade dispute with Japan which placed restrictions on three key materials needed by Korean manufacturers of semiconductors and flat screens. The BOK judged that the damage could be far graver than previously expected given Korea ― the leading global chipmaker ― relies heavily on Japan, which accounts for over 90 percent of the global supply of the three materials. “Our business environment has deteriorated further,” a mid-tier life insurer who refused to be identified said. “Products we sold about a decade ago ― savings-type, not protectiv

Jul 31, 2019By Lee Kyung-min
Low interest rate strains insurers, banks
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