[Column] Geumso Act, Foreseen Confusion and Authorities' Promise

[Asia Economy Reporter Kwangho Lee] "Please expedite the enactment of the Financial Consumer Protection Act enforcement rules."

On the 25th, just before the enforcement of the Financial Consumer Protection Act (FCPA), financial companies, unable to tolerate the financial authorities' delay any longer, finally voiced their dissatisfaction. On the 23rd, Kim Eun-kyung, Director of the Financial Consumer Protection Division at the Financial Supervisory Service, held a non-face-to-face meeting with Chief Consumer Officers (CCOs) from 10 banks and 11 life insurance companies.

Although the meeting was intended to listen to voices from the field, the atmosphere was reportedly cold. This was because, even two days before the law's enforcement, there were no enforcement rules, plunging each financial company into chaos.

The CCOs unanimously urged the prompt preparation of the FCPA enforcement rules. A CCO from Bank A indirectly criticized the financial authorities, saying, "Enforcing the law without enforcement rules is nonsensical." Another official complained, "It has been a year since the law passed the National Assembly, but the authorities have not even prepared the enforcement rules; I don't know what they have been doing," adding, "They have not completed the development of the IT systems either."

In fact, with the expansion of the right to withdraw subscription due to the FCPA enforcement, financial companies introduced text messaging as a withdrawal method. The problem is that there are no regulations on whom consumers should send the withdrawal text messages to, or how banks should verify the identity of the sender. Without guidelines, IT systems have not been built, and if an incident occurs, financial companies would bear all the responsibility.

Despite the flood of complaints from financial companies, Director Kim only gave a general response, saying, "We will continuously communicate to resolve difficulties and suggestions and provide support."

The FCPA is a law that should have been enforced sooner to strengthen financial consumer protection. If so, the private equity fund incident, which caused losses of several hundred billion won, could have been prevented in advance. Now, a major change in the existing financial companies' sales methods and products is expected. The resulting confusion will continue for some time. Of course, numerous trial and error processes are inevitable for the new system to settle.

However, considering the impact of the law, if the financial authorities had prepared a little earlier, the current criticism could have been avoided. We hope that the financial authorities' promise on this day to "provide more active guidance and support for the successful establishment of the FCPA" will be properly kept so that the purpose of the law is not undermined.

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