LINE, which is a subsidiary of Naver, is planning to start virtual currency trade and insurance sales businesses. It established its subsidiary called LINE Financial and registered LINE Financial as virtual currency exchanger at Financial Services Agency (FSA). It is looking to diversify source of profits for its messenger LINE and strengthen its competitive edge as a global messenger.
Naver made an announcement on the 31st that its subsidiary called LINE established its subsidiary called ‘LINE Financial’ in order to start financial businesses. LINE has been operating ‘LINE Pay’, which is a messenger-based mobile wire transfer payment service, and this is the first time when LINE is starting current financial services such as loans and insurances. Based on LINE Financial, LINE is going to prepare various finance-related services such as virtual currency trades, exchanges, loans, and insurances to its mobile messenger LINE. “Annual amount of payments made by LINE Pay, which has more than 40 million members, in 2017 surpassed $4.12 billion (450 billion yen).” said a representative for Naver. “We established a separate subsidiary in order to provide innovative financial services.”
It started recruiting experts in finance and blockchain from different countries and it is heard that hundreds of people have applied so far. “We are planning to provide convenient and safe financial services by combining blockchain with high level of security technologies that we have accumulated through our messenger service.” said a representative for Naver. “We are currently hiring many relevant talented people.”
Naver is planning to accelerate the process of establishing financial services by having major management team of LINE directly manage LINE Financial. President Idezawa Takeshi of LINE will become the president of LINE Financial while CSMO (Chief Security Marketing Officer) Masuda Jun of LINE and CFO Hwang In-joon of LINE will participate as director. Amount of capital will be about $45.8 million (49.1 billion KRW).
LINE is planning to strengthen its services such as deliveries and chores that are closely related to people’s daily lives in different countries. Other messengers such as WeChat and KakaoTalk are also trying to strengthen their financial services.
“We are going to strengthen areas of financial businesses and shorten the distance between people and financial services by establishing LINE Financial.” said a representative for Naver. “We are going to try to lead FinTech markets that do not require cash.”
Foreign media analyzed that this move made by LINE is its strategy to diversify business models that are too dependent on advertisements and to increase its competitive edge compared to other messengers. More than half of LINE’s sales comes from advertisements that are dependent on Timeline news. It can use financial services as weapons against other global messengers such as WeChat, Facebook, and Messenger while growth of members has slowed down.
“Creating financial services will lower dependence on profits made by advertisements and provide ways to secure members of countries that are dominated by Facebook Messenger and WhatsApp.
Staff Reporter Oh, Daeseok | email@example.com