After the Grace Period for the Financial Consumer Protection Act... Time Gained but Will It Become Violation No.1? 'Cautiously Cautious'

End of Financial Consumer Protection Act Guidance Period on the 24th

[Asia Economy Reporter Park Sun-mi] The grace period for the Financial Consumer Protection Act (FCP Act) is just one day away from ending. Since the financial authorities have stated that even after the grace period ends, a supplementary period will be granted during which no enforcement actions will be taken, the field is inevitably adopting a conservative approach, but there is a prevailing atmosphere that they have at least bought some time.

According to the financial industry on the 23rd, most domestic commercial banks and regional banks plan to complete the preparation of investment product brochures reflecting the FCP Act requirements by the 24th of this month, when the grace period ends, and are ready to implement them starting from the 27th. Some banks have determined that they need to partially supplement the investor suitability assessment system and plan to complete these improvements by the end of the year.

Within the banking sector, the application of the revamped investment product brochures will allow the resumption of sales of complex products such as leveraged index products, which had been difficult to sell until now. However, conservative management is unavoidable. A bank official said, "Since it is the initial phase of applying the revamped brochures, we have no choice but to sell conservatively and cautiously," adding, "It is fortunate that a supplementary period is granted even after the FCP Act grace period ends, but we must remain cautious until the system is fully established."

A financial authority official said, "Until now, financial investment product sellers such as banks and securities firms have used the investment brochures prepared by asset managers as they were when creating key product explanations, but due to the application of the FCP Act, they hurriedly proceeded with revising the brochures." He added, "For sellers whose revisions have been delayed and require supplementation, the Financial Supervisory Service and the Korea Financial Investment Association will work together to complete the supplementary work within this year."

On the other hand, financial platform companies that must immediately reflect the FCP Act contents or face service suspension are in a state of emergency. During the grace period, the financial authorities issued guidelines to companies that acknowledged the authorities' policies and agreed to make corrections, instructing them to suspend services until legal issues are resolved. Accordingly, Kakao Pay's online linked investment (P2P) service has been suspended, and in the insurance sector, the following services are expected to be discontinued: driver insurance (Samsung Fire & Marine Insurance), pet insurance (Samsung Fire & Marine Insurance), exercise insurance (Meritz Fire & Marine Insurance), mobile phone insurance (Meritz Fire & Marine Insurance), overseas travel insurance (KB Insurance, NH Nonghyup Insurance, Hyundai Marine & Fire Insurance), and the 'Insurance Solver' service provided through professional counselors affiliated with Rich & Co.

The fund sector avoided service suspension by completing the revision work. When selecting investment services within the Kakao Pay platform, a message first appears informing that the sales and brokerage entity is Kakao Pay Securities, and at the top of the fund investment screen, it clearly indicates that Kakao Pay Securities is the service provider. When selecting each fund product, the message informing the service provider is displayed again before proceeding with the investment.

Toss has set a policy to complete correction work during the supplementary period without suspending existing services. Regarding the insurance sector, where the correction work is not yet complete, they stated, "We plan to finish improving insurer recognition and the counselor connection process within this year."

Since it is difficult to complete the registration of loan solicitors (small and medium corporations, individuals), lease and installment solicitors by the 24th, an additional correction period has been granted so that those who apply for association registration by October 24 can complete registration within the year.

A financial industry official said, "Since the financial authorities are granting additional time to complete correction work for areas requiring further supplementation during the FCP Act grace period, it is unlikely that the first financial company violating the FCP Act will appear immediately," adding, "However, since conservative management or restrictions on financial services by some financial product sellers may occur starting from the 27th when the FCP Act is fully enforced, initial confusion should be anticipated."

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