Financial Supervisory Service to Expand Inspections by 29% This Year... "Preparing for the COVID-19 Cliff Effect"

Comprehensive Inspections Scheduled 16 Times, 9 More Than Last Year

[Asia Economy Reporter Wondara] The Financial Supervisory Service (FSS) has decided to increase inspections by about 30% compared to last year in preparation for the 'COVID-19 cliff.'

According to the '20201 FSS Inspection Operation Plan' announced by the FSS on the 21st, the FSS plans to conduct 793 inspections this year. This is a 29.4% increase from 612 inspections last year. The total number of inspectors will also expand by 66%, from 14,186 last year to 9,444 this year.

Comprehensive inspections, which were 7 times (3,314 people) last year, are expected to more than double to 16 times (5,134 people) this year, an increase of 9 times. These include 6 cases for banks and holding companies, 3 for securities, 1 for asset management, 4 for insurance, and 1 for mutual finance. Last year, comprehensive inspections were conducted only for 3 cases of banks and holding companies, 1 case of securities, 2 cases of insurance, and 1 case of specialized credit finance companies.

Sectoral inspections, which were 606 times (10,872 cases) last year, will increase by 171 times to 777 times (18,496 cases) this year.

This year's main surveillance and inspection targets are ▲ the sales process of financial investment products prone to consumer damage and unfair business practices ▲ newly included inspection targets such as online investment-linked finance business registrants and loan solicitation corporations ▲ non-face-to-face sales channels ▲ digital risks associated with financial innovation such as open banking and simple payment services.

The FSS stated, "Inspections were reduced last year due to the impact of COVID-19. This year, in preparation for the 'cliff effect' after the reduction of COVID-19 financial support, we will check the loss absorption capacity of financial companies and induce proactive capital expansion for vulnerable companies."

It added, "As this is the first year of enforcement of the Financial Consumer Protection Act, we have included the annual basic inspection direction and key inspection items to achieve the goals of 'financial consumer protection and financial system stability.' However, if on-site inspections are restricted due to the spread of COVID-19, inspections will focus on current issues such as consumer damage through remote and non-face-to-face methods."

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