Using Multiple Cards from One Card Company App in the Second Half of This Year (Comprehensive)

Development of Simple Payment Compatibility System by Year-End
Available as Early as December
Big Tech-Led Market Changes Anticipated

[Asia Economy Reporter Ki Ha-young] The card industry plans to develop a compatibility system for mutual access to simple payment services by the end of this year. As early as December, users will be able to register and use credit and check cards from multiple card companies within a single card company application (app). Attention is focused on whether this will bring changes to the simple payment market, which is currently dominated by big tech companies.

According to the industry on the 19th, the Korea Federation of Credit Finance Associations recently announced a bid for the project titled "Development of Interlocking Standards and Standard API for Mutual Compatibility Registration among Card Companies." The core of the project is to develop a compatibility registration system that opens each card company's pay app to other card companies, allowing multiple companies' cards to be registered and used within a single app. The company selected through this bid will develop the system for up to three months from the contract date. The goal is to complete the development of compatibility registration standards and the standard API within this year.

Until now, simple payments among card companies were not interoperable with other financial companies. For example, KB Kookmin Card's KB Pay can only be used for KB Kookmin Card payments and cannot process payments with other card companies such as Hyundai Card. This contrasts with services like Naver, Kakao, and Samsung Pay, which can be used with all card companies. This system development aims to increase platform universality and prevent big tech from taking the lead in the growing simple payment market.

In response to big tech, the five major domestic financial groups?KB Kookmin, Shinhan, Woori, Hana, and NH Nonghyup Financial?have already begun building integrated payment platforms simultaneously. These are group integrated payment platforms involving all affiliates based on card company simple payment services. Currently, these are group company integrated platforms, but the ultimate goal is to grow into open platforms accessible to customers of other financial companies as well.

With the increase in non-face-to-face payments due to the COVID-19 pandemic, the simple payment market is also rapidly growing. According to the Bank of Korea, the average daily usage amount of simple payments last year was 449.2 billion KRW, a 41.6% increase from the previous year. In particular, electronic financial operators such as Kakao Pay and Naver Financial accounted for the highest usage share at 45.7% last year. From the card companies' perspective, securing universality is essential to enhance competitiveness in the simple payment market.

Therefore, the key issue is how many card companies will actually participate in the simple payment open system. Although the card industry reached a principle agreement on the simple payment open system last May, only a few have decided to participate in practice. If multiple card payments are possible within a single app, competition to secure customers among card companies could intensify even before big tech involvement. While the system development will establish standards for registering other companies' cards, actual participation remains a separate matter.

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