The First Innovation Finance Project 'KB Live M' Igniting Labor-Management Conflicts (Comprehensive)

The First Discount Mobile Service in the Financial Sector
Union Urges Cancellation of Service Reassignment

[Asia Economy Reporter Park Sun-mi] KB Kookmin Bank's 'Liiv M,' the first designated innovative financial service by the Financial Services Commission (FSC), has been cornered due to discord between labor and management ahead of the decision on service extension.

On the 22nd, the KB Kookmin Bank labor union held a press conference in front of the FSC from 10:30 a.m., urging the cancellation of the designation of Liiv M, Kookmin Bank's MVNO business, as an innovative financial service. Since being selected as the first innovative financial service by the FSC in April 2019, it has been the first in the financial sector to provide mobile communication services. However, the main issue is that the conditions set to ensure that the telecommunications business does not interfere with the bank's core operations have not been properly observed, increasing the workload burden on bank employees.

The KB Kookmin Bank labor union stated, "Various unreasonable measures by the bank to boost the MVNO business performance are interfering with the bank's core operations and pushing employees into additional performance pressure," adding, "Earlier this year, we also submitted a petition to the FSC requesting the cancellation of the re-designation of the innovative financial service."

They continued, "When the financial authorities initially granted permission, they imposed 'additional conditions' that Kookmin Bank must fulfill while running the business," explaining, "Among these additional conditions, it was clearly stated that 'internal control measures must be established to ensure that the telecommunications business does not interfere with the bank's core operations.' However, over the past two years, the bank has blatantly violated these additional conditions, leading to ongoing conflicts and discord with the labor union."

Innovative financial services are part of a sandbox system where the government temporarily relaxes related regulations to allow financial companies to commercialize innovative services. After the initial selection, regulatory exemptions on business activities are granted for two years, and upon review, an additional two years of exemption can be granted if service extension is approved.

Liiv M Innovative Financial Service Designation Period Expires in April... Kookmin Bank Applies for Business Extension

Kookmin Bank, seeing the MVNO business designated as the first innovative financial service in April 2019 and continuing the financial-telecommunication convergence business as positive for both the bank and customers, submitted an application for service extension to the FSC in January. The review process is currently underway, and the extension decision will be made before April.

The labor union's opposition to Kookmin Bank's MVNO business poses a significant burden to both Kookmin Bank and the financial authorities ahead of the FSC's re-designation decision. While the union's opposition itself may not decisively influence the FSC's review, there is concern that the re-designation of the innovative financial service by the FSC could lead to intensified labor-management conflicts, potentially causing harm to financial consumers.

Kookmin Bank claims to be engaging in smooth dialogue with the labor union to resolve issues for business re-designation, but the union raises its voice in opposition, stating that the management has not made any attempts to contact or consult with the labor union in any form regarding the re-designation of the MVNO innovative financial service.

Currently, the Liiv M service is operated by assigning one Liiv M manager per PG (Partnership Group), which typically consists of 5 to 7 Kookmin Bank branches, to interact with customers. Due to discord between labor and management, active promotion of the Liiv M business through branches has not been effective, and despite approaching two years since its launch, the number of Liiv M subscribers falls far short of the initial target of one million, not even reaching 100,000.

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