Discussion on the Electronic Financial Transactions Act to Resume Next Week... Passage Likelihood "Uncertain..."

Discussion Expected on Proposals by Lawmakers Yoon Gwan-seok and Kim Byung-wook
New Agendas Emerge Including Digital Finance Council

[Image source=Yonhap News]

[Asia Economy Reporter Kiho Sung] The amendment to the Electronic Financial Transactions Act (Jeongeumbeop), which has been stalled for a year, is set to resume discussions next week. Although there is hope that legislation will accelerate following the recent proposal of a new amendment, concerns remain that it will be difficult to pass within the year as the interests of the various stakeholders still run parallel without convergence.

According to the National Assembly on the 12th, the Political Affairs Committee plans to hold a subcommittee meeting on the 17th to place the Jeongeumbeop amendment on the agenda. A committee official stated, "The schedule for the first subcommittee of the bill review is set for the 17th and 23rd," adding, "The Jeongeumbeop will be submitted on the 17th."

The amendments to be discussed are expected to simultaneously review the bill proposed by Democratic Party lawmaker Yoon Gwansuk in November last year and the bill proposed by Democratic Party lawmaker Kim Byungwook earlier this month.

Particular attention is on Kim’s bill. It is based on Yoon’s proposal, which introduces new licenses such as MyPayment and comprehensive payment services, and allows postpaid payments for simple payment providers. It also comprehensively includes issues pointed out by various sectors until recently. Key points include strengthening criminal penalties for unregistered companies to prevent a recurrence of the ‘Merge Point incident,’ post-reporting of concurrent and incidental businesses by comprehensive payment service providers, and review by the Digital Finance Council when implementing the comprehensive payment service system.

Especially, the industry is showing sensitive reactions to the clause regarding the Digital Finance Council’s review. This clause was introduced to appease existing financial companies opposing the amendment as a ‘Naver special treatment law,’ requiring big tech companies to undergo review by the Digital Finance Council when the comprehensive payment service system is implemented. Although the participating entities have not yet been finalized, the Digital Finance Council is expected to include the Financial Services Commission, financial companies, and big tech firms.

Despite these provisions, the National Financial Industry Labor Union remains strongly opposed to the amendment. A union official pointed out, "The union continuously opposes the introduction of comprehensive payment services and insists on the principle of ‘same work, same regulation.’ The bill does not reflect the union’s position, and the introduction of the Digital Finance Council may rather disperse responsibility."

The fintech industry also expresses concerns. They fear that the Digital Finance Council could negatively impact the implementation by delaying enforcement even if the bill passes. There is also a view that the enforcement decree might be shaped through council discussions to favor existing financial sectors. A fintech industry official said, "Ultimately, the problem lies in the composition of the council that holds decision-making power. So far, it appears to be led by existing financial sectors," adding, "If the existing financial sector’s influence is strong in the council, the comprehensive payment service itself will become meaningless."

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