Shinhan Card Selected for Ministry of Science and ICT Data Flagship Project...Only Financial Company

Development of Alternative Credit Scoring Model for Financially Marginalized Groups Underway

[Asia Economy Reporter Ki Ha-young] Shinhan Card announced on the 16th that it has been selected as the only financial company to support the '2021 Data Flagship Project,' organized by the Ministry of Science and ICT and the National Information Society Agency (NIA).

The Data Flagship Project is a program that supports the development of products or services aimed at solving social issues and business innovation by utilizing big data and artificial intelligence (AI) technologies. It has been conducted annually since 2013 under the supervision of the Ministry of Science and ICT, and this year, a total of 12 final projects were selected.

Shinhan Card participated in the competition as a consortium with data holder Wider Planet and Crepas Solution, which applied for the first preliminary license for specialized personal credit evaluation (non-financial CB), under the theme of "Data-based Financial Inclusion Measures for Financially Marginalized Domestic and Foreigners." The plan is to derive measures that enable financially marginalized groups, who have been disadvantaged under the existing credit evaluation system based on financial transaction history, to receive appropriate financial services. Notably, the project distinguishes between domestic individuals with insufficient financial history and foreigners with disconnected financial information to develop services tailored to each group's characteristics.

For domestic individuals, such as young adults entering society, full-time homemakers, and the elderly who lack sufficient financial information (thin-filed individuals), an alternative credit evaluation model will be developed by extracting personal preferences and consumption patterns from digital behavioral data that have not been used in existing credit evaluation criteria.

To this end, Shinhan Card is continuously discovering new credit evaluation factors through data integration secured via partnerships with various heterogeneous businesses building a private data dam, based on an environment recently established by MyData and Open Banking that allows diverse financial transaction information scattered across multiple financial companies to be utilized for consumer benefit.

For foreigners, the strategy is to accumulate, process, and evaluate financial transaction data generated during their residence in Korea to build an inter-country credit information exchange system that provides continuous credit evaluation and financial services even when moving between countries.

In particular, a pilot project will be conducted in connection with Vietnam, the second-largest foreign resident nationality in Korea. Shinhan Vietnam Finance (SVFC), which has a nationwide sales network in Vietnam, has begun reviewing mutual data linkage processes, and discussions on inter-country collaboration directions are underway with the Credit Information Center (CIC) of Vietnam.

A Shinhan Card official stated, "Through the development of new credit evaluation models using digital data, we aim to provide inclusive financial services for financially marginalized groups," adding, "In connection with the Shinhan Group N.E.O. project, we will improve the inclusiveness of the financial system and lead the data economy."

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