Preventing Mobile Banking Mistaken Transfers... Strengthening Prevention Features and Improving Transfer Systems

As mobile remittances become more active, cases of mistaken remittances due to incorrect input of account numbers or remittance amounts during the simple use of mobile remittance are increasing, prompting the Financial Services Commission to continuously strengthen preventive functions.

On the 8th, the Financial Services Commission announced that it had identified the main causes of mistaken remittances and inspected the functions built into the transfer system to prevent them, together with the Korea Deposit Insurance Corporation.

According to an analysis of 14,717 cases of mistaken remittances received since July 2021 when the Korea Deposit Insurance Corporation has been operating the "Mistaken Remittance Return Support System (a service to recover wrongly sent money)," 87.0% of mistaken remittances occurred when transferring from bank accounts or simple remittance accounts, and among them, 64.5% occurred when using smartphone mobile apps (mobile banking and simple remittance).

In addition, mistaken remittances mainly occurred due to incorrect input of account numbers during the remittance information input process (66.8%) or incorrect selection of the transfer target from the "recent transfer list," etc. (28.3%).

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Accordingly, the Financial Services Commission and the Korea Deposit Insurance Corporation focused on the need to strengthen mistaken remittance prevention functions related to mobile banking and simple remittance apps and promoted the establishment of mistaken remittance prevention functions for 206 financial companies. In March, they inspected the mobile apps of the top 10 financial companies with frequent mistaken remittances to identify necessary functions to reduce remittance errors during transfers, and subsequently prepared best practice cases for necessary functions to prevent mistaken remittances based on the inspection results and shared them with the 10 financial companies. The financial companies also submitted plans to supplement and improve their mobile apps.

Additionally, best practices were disseminated to 196 financial companies capable of additional fund transfers to minimize customers' possibility of mistaken remittances, and cooperation was requested to ensure that necessary functions are established in their respective mobile apps.

Joo Hong-min, Director of the Structural Improvement Policy Division at the Financial Services Commission, said, "It is expected that the possibility of mistaken remittances will be greatly reduced if the transfer system of mobile apps is improved," adding, "We plan to continue follow-up measures such as checking the status of supplementation and improvement of necessary mistaken remittance prevention functions in mobile apps and to persistently make additional efforts to prevent mistaken remittances."

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