The Securities Deliberation Committee Approves Kakao's Entry into the Securities Industry

[Asia Economy Reporter Park Ji-hwan] Kakao is entering the securities industry. This is because the acquisition plan of Baro Investment Securities through its simple payment subsidiary Kakao Pay has received approval from financial authorities.

The Securities and Futures Commission under the Financial Services Commission passed the suitability review for Kakao Pay's major shareholder status in Baro Investment Securities at its regular meeting on the 22nd. The Financial Services Commission plans to make the final decision on this agenda at its regular meeting on the 5th of next month.

Earlier, in October 2018, Kakao Pay signed a contract to acquire 60% of Baro Investment Securities' shares for 40 billion KRW. At the time of the acquisition contract, Kakao Pay revealed a blueprint to enable trading of various investment products such as stocks, funds, and real estate within the KakaoTalk platform.

However, the Securities and Futures Commission's review was suspended as Kakao Chairman Kim Beom-su faced trial on charges of violating the Fair Trade Act. Under the current Capital Markets Act, major shareholders of financial companies must not have been sentenced to fines or higher penalties for violations of financial laws, the Fair Trade Act, or tax laws within the past five years.

Currently, Kakao's affiliate Kakao Bank has been providing services such as simple payment, remittance, and authentication since receiving internet banking approval in 2017. With the completion of the acquisition of Baro Investment Securities, Kakao will be able to expand its financial business to include investment brokerage and direct sales of financial products.

This content was produced with the assistance of AI translation services.