This file photo shows ATMs of major South Korean banks. (Yonhap)
SEOUL, June 7 (Korea Bizwire) — In response to the challenge posed by tech giants making inroads in the banking industry, traditional financial services companies such as banks and credit card issuers are going on the counterattack.
Credit card companies are preparing to launch an ‘open pay’ service that enables customers to register and use rival cards on their simple settlement platforms.
In April, the nation’s nine major credit card companies reached an agreement to open the way for other cards to be used on their platforms in a mutually beneficial manner.
The new simple settlement service, led by Naver Corp. and Kakao Corp., the two major South Korean tech companies, allows users to register their credit cards or bank accounts via smartphone apps and make payments easily through near field communication (NFC) or barcode recognition.
Banks are also busy devising countermeasures. Shinhan Bank, for example, reportedly invested more than 10 billion won (US$9 million) to enter the delivery app market.
KEB Hana Bank spun off its overseas blockchain-based payment settlement business as a subsidiary late last month as part of efforts to create a stronger presence in the payment settlement service market.
To cope with the challenge posed by Kakao Bank and K-Bank, the country’s two internet-only banks, the nation’s major financial holding companies including KB Financial Group Inc. teamed up to create a joint internet bank.
Ashley Song (ashley@koreabizwire.com)
