[Start! MyData] 'Naver·Kakao Bank Accounts' Coming Soon... Financial Industry Earthquake Expected

MyPayment and Comprehensive Payment Settlement Business Near Approval
February National Assembly Review Ahead... Concerns Over Unfairness Raised

[Image source=Yonhap News]

[Asia Economy Reporter Kiho Sung] The government's electronic finance promotion plan is broadly divided into Personal Credit Information Management Services (MyData) and Payment Instruction Transmission Services (MyPayment). The plan aims to actively foster the fintech (finance + technology) industry and startup companies through a two-track strategy.

With the MyData service era opening next month and the amendment to the Electronic Financial Transactions Act expected to pass the National Assembly within this year, financial market liberalization measures such as MyPayment and comprehensive payment business licenses will be fully implemented, making a major restructuring of the financial industry inevitable.

MyPayment is a service that allows consumers to make payments without holding payment funds. It is easy to understand by thinking of credit cards. If a fintech company obtains a comprehensive payment business license, it can issue accounts, which was previously only possible for banks and other financial institutions. Once the related bill passes, big tech (large information and communication companies) and fintech companies based on data will become 'quasi-banks' capable of performing most banking tasks except deposits and loans.

For example, consumers can create a ‘Naver·Kakao account’ to use as a salary account, and automatically transfer card payments or insurance premiums from this account. Additionally, postpaid payments up to 300,000 KRW per month will be possible, enabling the use of ‘00Pay’ like a credit card. Although there is no deposit function and thus no interest, points can be earned proportional to payment performance.

However, financial companies oppose the policy that effectively opens all banking operations to fintech firms, arguing it could create a ‘big tech dependency structure.’ Especially as big tech companies like Naver and Kakao increase their market influence, financial companies claim that because they are electronic financial operators, they face less regulation than traditional financial sectors and that data sharing is unfair.

Regarding the comprehensive payment business license, criticism arises that the minimum capital requirement of 20 billion KRW will effectively make it the main stage for big tech. Furthermore, considering that big tech companies operate point systems close to cash, there is a call for additional discussions on clear definitions and provision limits regarding the effective interest payment functions of electronic financial operators.

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