[Click eStock] "SettleBank, Growth Expected Through New Merchant Expansion and Overseas Entry"

[Asia Economy Reporter Minji Lee] Korea Investment & Securities stated on the 22nd that SettleBank is expected to grow in the second half of the year due to the effect of new merchants and overseas expansion.

SettleBank is a fintech company specializing in electronic finance and payment platforms. In 2019, its total sales were divided into 44.7% from simple cash payments, 33.6% from virtual accounts, 16% from PG, 3.6% from firm banking, and 2.1% from others. The largest portion, simple cash payments, began full-scale service in 2017 and grew at an average annual rate of 56% over two years, establishing itself as a core service.

Researcher Baek Doosan of Korea Investment & Securities said, “Currently, we hold 97% of the market share in the virtual cash payment market,” and added, “The structural growth of the industry due to the popularization of simple payments is leading to an expansion in scale.”

Major pay companies such as KakaoPay, NaverPay, and Payco are customers of simple cash payments, and competition among retailers and fresh food companies to launch their own pay services continues. Since this competition is ongoing, sales growth through the expansion of new merchants is expected to continue.

Researcher Baek explained, “The Korail Pay, launched last February, is expected to contribute significantly to sales once the impact of COVID-19 diminishes, considering that Korail’s passenger business records an average daily sales of 6.6 billion KRW.”

SettleBank is also pursuing overseas expansion. In February, it signed an MOU with MC Payment, a supplier of electronic payment services for global pay companies such as Alipay and WeChat Pay, and in April, it signed an MOU with AsiaPay, the largest electronic payment service provider in Asia, laying the foundation for building a pan-Asian payment network.

Researcher Baek said, “Using local payment infrastructure, we will support cross-border payments targeting overseas merchants in Singapore, Vietnam, Malaysia, Indonesia, and other countries,” and added, “Since fees will be shared with local payment companies and merchants, and additional services such as currency exchange will be provided, profitability is expected to be higher than the domestic simple cash payment sector.”

Regarding the stock price slump due to the implementation of open banking, it was viewed as not a major threat. The market is concerned that the reduction in remittance fees due to open banking could lead to decreased sales and weaken the profitability and growth potential of core services.

Researcher Baek said, “The implementation of open banking accompanied by government policies to activate cash payments could lead to an expansion of simple cash payment merchants and an increase in transaction volume,” and added, “In the structural growth phase, the effect of increased transaction volume through market expansion will outweigh the impact of price declines.”

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