"To Sustain the MyData Industry, 'Data Sharing Costs' Must Be Considered"

Kim Ji-sik, Vice President of Naver Financial, is giving a presentation on the topic "Naver Financial's MyData and Challenges - Focusing on Trends in Data-Related Regulations" at the Korea Credit Information Services' "Financial Data Conference 2022" on the 21st.

[Asia Economy Reporter Eunju Lee] There has been a call for the introduction of effective measures that can promote data sharing between companies to ensure the sustainability of the MyData industry. Currently, the MyData business environment involves significant costs for both information providers and recipients, making it difficult to promote data sharing between companies from a long-term perspective.

On the 21st, the Korea Credit Information Services held the "Financial Data Conference 2022" at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul, under the theme "The Paradigm Shift in Finance Led by AI and Big Data." At the keynote presentations, traditional financial institutions and fintech companies assessed the current state of their businesses in the data economy era and introduced changes in services brought about by the MyData industry.

"MyData data transmission incurs billions in costs annually... A 'fair' MyData revenue model must be established for sustainability"

At the keynote presentation, Kim Jisik, Vice President of Naver Financial, diagnosed that current MyData participants bear considerable costs for their business but have yet to find a proper revenue model. Vice President Kim stated, “For a MyData company to share information, it must build data APIs and standardize information before transmitting it to other companies, a process estimated to cost billions annually.” He added, “Well-capitalized operators like Naver Financial can bear these costs, but small-scale MyData operators find it difficult to sustain such expenses long-term,” and emphasized, “To ensure smooth operation of the MyData business, there needs to be consideration of the cost burden related to data transmission.”

However, he noted that the assessment of cost burdens borne by operators contributing to the MyData ecosystem should be discussed carefully, as there are limitations in accurately measuring each company's share of the burden for industry activation. He mentioned, “We must carefully consider that MyData participants might inflate their infrastructure costs for data transmission, which could increase cost burdens among operators and potentially lead to the ecosystem's overall 'mutual destruction.'” Furthermore, considering that MyData started to restore individuals' rights to control their personal information, guaranteeing companies revenue from selling personal data does not align well with the original intent.

Vice President Kim argued for actively easing current regulations to enable financial product brokerage platforms to operate more actively. He said, “There should be a system where MyData operators can create revenue models and legitimately generate added value even when they earn profits,” and “Through regulatory reforms, financial product brokerage platforms should be established.” He also pointed out the need to create an appropriate regulatory framework, considering that the online platform's brokerage role is less intensive compared to face-to-face sales.

Park Hong-min, CEO of Finda, is giving a presentation on the topic "Sharing MyData Cases and Future Prospects Based on Finda's Business Cases" at the Korea Credit Information Services' "Financial Data Conference 2022" on the 21st.

"A reasonable charging system for information-providing individuals must be established"… "The scope of MyData information also needs to be expanded"

Kim Myunghee, Vice President and Chief Digital Officer (CDO) of Shinhan Financial Group, argued that a ‘reasonable charging system’ needs to be established to activate the MyData industry. Vice President Kim stated, “For a sustainable MyData ecosystem, individuals (information providers) must have the expectation of receiving convenient services and monetary benefits,” and “It is necessary to consider ways to provide financial benefits to data subjects from the revenue generated by data provision.”

Park Hongmin, CEO of Finda, which introduced Korea’s first loan comparison service, believes that the scope of shareable information should be expanded for the sustainable development of MyData services.

CEO Park explained that the MyData business has made it easier to secure various data, enabling Finda to implement user-customized services. He said, “Before MyData, it took time to collect data from multiple financial institutions and immediately implement services tailored to user needs,” adding, “However, thanks to MyData, it has become possible to quickly provide services that manage users’ loan schedules and recommend repayment strategies according to customer needs.” He further noted, “If business loan information data for small business owners and self-employed individuals, along with refinancing loan repayment account information, are provided, the competitiveness of services through MyData will be strengthened.”

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