[Big Tech, Big Change] All Financial Information in One Place: The Bank's Counterattack

<7>MyData Business Full-Scale Launch
Official License Applications Accepted Starting Today
Big Data Workforce Increased by 60%

[Asia Economy Reporter Park Sun-mi] Commercial banks are making every effort to strengthen their 'MyData business (personal credit information management service).' This business has officially started with the enforcement of the amendment to the Data 3 Act (Personal Information Protection Act, Credit Information Protection Act, and Information and Communications Network Act) on the 5th. As a showdown for market dominance with big tech companies such as Naver and Kakao, major fintech players, is anticipated, banks plan to leverage their core strengths in finance and digital services to gain an early advantage.

According to the financial sector on the 5th, the number of companies that submitted preliminary license pre-application forms by the previous day was less than half of the 119 companies that expressed their intention to participate in the preliminary demand survey conducted in May. However, the preliminary license pre-application is a procedural step to facilitate business licensing and has no legal effect; the formal license application process begins on this day. The MyData business refers to a model that collects scattered financial transaction information from banks, credit cards, insurance, telecommunications companies, etc., and provides it in an integrated view for financial consumers, enabling customized product recommendations, financial product consulting, and generating revenue based on this data.

Major commercial banks that submitted preliminary applications have newly organized dedicated teams and launched financial products and services that utilize data. In fact, as of June this year, the number of personnel in big data-related departments at the five major commercial banks?KB Kookmin, Shinhan, Woori, Hana, and NH Nonghyup?reached 172, an increase of more than 60% compared to the same period last year. The heads of these related departments are veterans in digital and IT fields.

NH Nonghyup Financial plans to open 'My Car Management Service' and 'Government Subsidy Recommendation Service' within this month and provide a lifestyle-oriented personal comprehensive asset management service by the end of the year. They are also building an open platform that collects and manages individuals' financial and non-financial information on smartphones and shares it with companies. Additionally, through organizational restructuring, they established a Personal Financial Management (PFM) cell in January, an IT MyData Promotion Team in May, and a Data Business Department in July. They are also operating a MyData response system (working group) composed of 15 departments within the bank. Last month, they recruited Lee Sang-rae, a former Samsung SDS executive from Samsung Group, as the deputy head of the Digital Finance Division, overseeing digital business.

Woori Bank is preparing 'hyper-personalized financial and asset management services' and 'lifestyle platform-linked businesses.' To this end, in May, they launched the 'MyData License Preparation Special Planning Team' (TFT), which oversees and executes all tasks related to entering the MyData business. This large-scale project involves 33 members from 20 departments across the bank, including six executives such as Chief Digital Officer (CDO) Hwang Won-chul. They plan to enable integrated asset management, information account services, and data fusion targeting through partnerships with fintech companies. Additionally, last month, they established a Digital Transformation (DT) Promotion Team for digital innovation. The DT Promotion Team will oversee the bank’s overall digital strategy, expansion of new technology applications, digital marketing, and channels.

Hana Financial Group has been promoting a group-level MyData business response strategy project since May. Its core affiliate, Hana Bank, aims to secure future customer touchpoints through the MyData business, differentiate products and services based on a customer-centric data platform, and strengthen capabilities to expand business based on an open ecosystem.

Shinhan Bank plans to integrate the MyData business into its currently provided asset integration inquiry service 'MY Asset' to enhance it. They are considering providing asset management services across various fields, from product recommendations based on customer-held asset data to solutions for real assets such as real estate and automobiles.

KB Kookmin Bank’s MyData business foundation is expected to be the personal comprehensive asset management service (PFM) 'MyMoney,' which started in September 2016. Services that were previously provided separately through various apps such as real estate, automobiles, banking, and payment are likely to be integrated into a unified service.

However, some concerns have been raised that big tech companies entering the MyData business might receive banks’ financial transaction information and use it to expand their market share, potentially exacerbating the imbalance between general banks and big tech firms.

A financial sector official said, "The newly established MyData industry will act as a new opportunity to secure future competitiveness in the rapidly changing financial market, but it also poses risks such as weakening the data monopoly of existing financial companies."

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