KakaoPay, South Korea’s popular payment platform, has witnessed an astonishing 14-fold increase in transactions made by foreign tourists within a year. (Image courtesy of Yonhap)
SEOUL, Aug. 14 (Korea Bizwire) – Kakao Pay, a leading digital payment service in South Korea, announced on Wednesday that it has ceased sharing user information with Alipay since mid-May, following a controversial breach involving the unauthorized disclosure of personal credit data.
In a statement, Kakao Pay revealed that the suspension of information sharing began on May 22, citing the ongoing investigation by the Financial Supervisory Service (FSS).
The company emphasized that it had obtained consent from its partners before halting the data exchange. “We deeply regret the inconvenience caused by our failure to fully explain this issue in advance,” the company stated.
Kakao Pay clarified that the data shared with Alipay had been anonymized, in line with an outsourcing agreement. This partnership, the company explained, was intended to assist Apple in identifying potential fraudulent payments within its App Store.
The company stressed that it remains committed to maintaining a secure payment environment, collaborating with Apple and Alipay to prevent fraudulent transactions and enhance user safety.
“We are doing our utmost to make Kakao Pay safe and convenient to use, including preemptively blocking fraudulent payments and suspicious transactions linked to identity theft,” the statement added.
The announcement follows revelations from the FSS, which conducted an on-site inspection of Kakao Pay’s cross-border payment operations between May and July.
The FSS found that Kakao Pay had shared the personal credit information of all its users, including those who had not engaged in cross-border transactions, with Alipay without obtaining user consent.
According to the FSS, Kakao Pay had transferred a staggering 54.2 billion pieces of personal credit information to Alipay on a daily basis since April 2018.
This data included Kakao Account IDs, mobile phone numbers, email addresses, Kakao Pay subscription details, and transaction records such as balances, payments, and remittances, affecting 44.5 million users.
Ashley Song (ashley@koreabizwire.com)
