[Donghak Ants One Month] Will KakaoTalk and Toss Ignite the Donghak Ant Movement?

[Asia Economy Reporter Minji Lee] As interest in stocks has increased among investors due to the novel coronavirus disease (COVID-19), it is expected that the number of investors entering the stock investment market will significantly increase with the addition of KakaoPay Securities and Toss Securities (Toss Preparatory Corporation).

According to data from the Korea Financial Investment Association on the 20th, the total number of CMA accounts as of last month was 16,938,750, an increase of 718,776 accounts compared to 16,219,984 accounts in January. Considering that the number of accounts increased by 284,516 during the same period last year, it is analyzed that the number of investors entering stock investment has greatly increased this year.

Im Heeyeon, a researcher at Shinhan Financial Investment, explained, "The increase in brokerage revenue of securities firms is thanks to the Donghak Ant Movement," adding, "As global stock market volatility has significantly increased, low bank deposit interest rates, strengthened real estate regulations, and the resulting fear of market contraction have accelerated the inflow of investors into the stock market."

In this situation, the securities industry expects that the emergence of KakaoPay and Toss Securities, which provide highly accessible and simplified stock trading services, can lead investors into the stock market. While existing securities firms focus on providing stock trading services via web and mobile platforms, tech-fin companies like KakaoPay and Toss Securities concentrate on offering customized financial services tailored to their existing mobile users.

In fact, KakaoPay Securities, which launched its service on February 27, is making steady progress, surpassing 500,000 accounts within a month of its launch. The number of account openings increased rapidly due to its own promotional events and the rise in people investing in stocks amid the spread of COVID-19. Previously, KakaoPay Securities has been running an event offering 5% interest on account balances where KakaoPay Money is automatically deposited.

Particularly, Kakao has seen a significant increase in subscribers centered on the young generation familiar with mobile platforms. By age group, those in their 20s and 30s accounted for 68.4% of the total. Among them, social newcomers (ages 25-34) made up 39.2%. It is analyzed that the 20s and 30s age groups, who have used Kakao and KakaoBank, have started investing in stocks through KakaoPay Securities, which offers excellent accessibility.

A representative from KakaoPay Securities stated, "The ability to open accounts without being restricted by securities business hours seems to have had an impact," adding, "The convenience, benefits, and simplified process of securities accounts have lowered the entry barrier, which appears to have increased investor inflow."

Toss plans to launch Toss Securities in the second half of this year. On the 18th of last month, the Financial Services Commission approved the preliminary license for financial investment business to Viva Republica (Toss Preparatory Corporation) at a regular meeting. The preliminarily licensed Toss Preparatory Corporation must meet personnel and physical requirements within six months to apply for the full license. Once the full license application is submitted, the review will be conducted within one month, and if approved, operations can begin within six months.

Furthermore, with the enforcement of the 'Data 3 Act'?which includes amendments to the Personal Information Protection Act, Credit Information Protection Act, and the Information and Communications Network Act?in the second half of the year, the competitiveness of tech-fin companies is expected to increase further. Minah Lee, a researcher at Daishin Securities, explained, "Both KakaoPay and Toss have proven successful business models in financial product sales," adding, "With the full-scale launch of the MyData industry, one of the amendments to the Credit Information Protection Act enforcement ordinance in the second half of the year, sales revenue from financial product sales is expected to increase more steeply."

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