Even with Open Banking Launched, Latecomer Savings Banks Remain Lukewarm

67 Savings Banks Open Banking Launch D-1
Banks, Securities Firms Already Securing Customers
New Business Linkage Requires IT Talent and Funding

[Asia Economy Reporter Song Seung-seop] The implementation of the Savings Bank Open Banking service is just one day away, but the industry remains lukewarm. It is difficult to attract open banking customers from large financial companies that have already started open banking, and small savings banks believe it will be challenging to link with new businesses in the future.

According to the industry on the 28th, from the next day, the Savings Banks Association application (app) ‘SB Toktok Plus’ will implement the open banking service. This will enable customers of 67 companies using the association’s joint computer network to use open banking. Savings banks using individual computer networks, including SBI Savings Bank, will be able to use the service in May after system transition work is completed.

Open banking is a service that standardizes remittance and payment networks to handle financial tasks of multiple financial companies within a single financial company app. After a pilot service by 10 banks in October last year, it started with 47 companies including fintech firms in December.

Although customer convenience is expected to increase and fintech innovation infrastructure will be established, the savings bank industry is generally calm. Some companies are expected to conduct large-scale special promotions for deposits and savings products.

Large Companies Have Already Secured Customers... Can Latecomers Overcome Disadvantages?

It is interpreted that expectations are low as they start at a disadvantage as latecomers in open banking. A savings bank official explained, "Our company will not launch separate financial products or events," adding, "Since there are not many customers who use savings banks as their main bank, it is not a hot issue in the industry." Another savings bank official said, "Even if open banking starts, it is difficult to take customers from existing open banking users in other financial sectors."

The association originally planned to launch the service on the 29th of last month. However, some errors were found during system testing, and the launch was delayed by about a month due to correction and stabilization work. Compared to other sectors that have been conducting official business for over a year, this is a considerable delay.

Large financial companies such as commercial banks and securities firms secured customers through active promotions during the early stages of the open banking pilot project. As a result, the number of open banking subscribers and registered accounts exceeded 40.96 million and 65.88 million respectively within six months of implementation. This accounts for about 72% of the domestic economically active population, and the number of registered open banking customers is likely to have increased further.

Among savings bank officials, there were many voices about increasing savings bank users through the open banking of commercial banks. This was the reason why large savings banks launched various events when savings bank open banking was registered with other financial companies in February.

There are also many challenges to be solved to link with future MyData or MyPayment industries. Digital innovation projects require large-scale IT personnel and funds. Large financial companies are scooping up IT talent, and small and medium-sized savings banks lack the funds to support this.

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