Collaboration Generation of IT and Finance Is Here
K-Bank led by KT and Korea Kakao Bank led by Kakao and Korea Investment Holdings Co., Ltd. Are chosen as South Korea’s first internet only bank. I-Bank led by InterPark Consortium was promised to try again next time.
Financial Committee made an announcement on the 29th that it held a briefing and gave screening licenses to K-Bank and Korea Kakao Bank. External Evaluation Committee advised final screening licenses to two banks after going through screening of 3 applicants from the 27th to 29th.
“Not only do we acknowledge innovativeness of KakaoTalk-based business plans, but we also see that Korea Kakao Bank will be able to mange business because its early establishment of system based on customers will be easy.” said Financial Committee about Korea Kakao Bank. “We also believe that K-Bank will prepare many customer touch points by maximizing capabilities of its shareholders that are participating and provide convenience to customers by providing innovative services.” said Financial Committee about K-Bank why it decided to give K-Bank an approval.
After world’s first internet only bank SFNB was established in October of 1995, about 30 internet only banks were established until early 2000. Although South Korea attempted to establish internet only banks from 2001 to 2008, their attempts were foundered due to lack of social awareness and others. In 2001, large businesses such as SK Telecom, Lotte, and Kolon and venture companies such as Ahnlab, E-net Future System and others joined together and pushed for establishment of internet only bank called V-Bank (tentative name). However their attempts went back to square one due to lukewarm stance from South Korean Government and failure of attraction of funds. Although Financial Committee pushed for introduction of internet only bank system through revision of bank laws as part of reformation of financial regulations in 2008, it failed to legislate such system.
After receiving application of screening license on the 1st of October as part of financial reformation, Financial Committee received applications from Kakao Bank Consortium led by Kakao, K-Bank Consortium led by KT, and I-Bank Consortium led by InterPark.
This bank industries’ screening licenses correspond to 1st step of permission of revision of bank laws related to introduction of internet only bank.
Two banks that were given screening licenses will apply for actual license in first half of 2016 after securing personal and material conditions and start actual businesses in second half of 2016 after going through establishment of corporation.
Financial Committee is planning for additional licenses for internet only bank according to revision of bank laws.
This screening license’s evaluation took place with focus on business plans and innovativeness. Financial Committee evaluated on 5 items such as business plans and innovative (250 points), increase of convenience for financial consumers (100 points), stability of business model (50 points), contribution towards development of South Koreas financial industries and strengthening of competitiveness (50 points), and possibility of entering foreign markets (50 points).
“We expect that new financial service will emerge through convergence of IT and finance due to introduction of internet only banks.” said General Manager Do Kyu Sang of Financial Committee Service. “Through this, more job openings with good quality will be created and it will help bank industries to enter foreign markets by vitalizing FinTech.”
Staff Reporter Gil, Jaeshik | osolgil@etnews.com & Staff Reporter Kim, Jihye | jihye@etnews.com