Internet-only banks in South Korea can be accessed at any time via mobile devices or the internet, allowing customers to conduct a variety of banking transactions without having to visit a branch or ATM. (image: Yonhap)
SEOUL, May 22 (Korea Bizwire) – South Korea’s financial regulator is expected to give preliminary approval next week to a consortium to set up the nation’s third Internet-only bank, senior officials at financial authorities said Wednesday.
Two consortia, one led by fintech firm Viva Republica and another by brokerage Kiwoom Securities, have been short-listed for a license to launch a online-only bank.
Financial authorities are set to begin a three-day review of their qualification later this week and a decision is likely to be announced as early as Monday, according to the officials.
“A panel of independent evaluators plans to start a review on Friday,” a senior official at the financial authority said. “Based on the outcome of the review, financial authorities will make an announcement on Monday.”
Another senior official at the financial authority declined to confirm the schedule, but hinted that the announcement could be made on Monday.
Viva Republica, which operates the popular financial services app Toss, formed a consortium that includes Hanwha Investment & Securities and foreign venture capital firms, such as Altos Ventures of the United States and Goodwater Capital of Britain.
Kiwoom Securities is part of a consortium that includes Hana Financial Holdings and SK Telecom.
If both consortia are qualified for a online-only bank, financial authorities could allow them to launch a third and fourth bank, officials have said.
Two Internet-only banks — K-Bank and Kakao Bank — were launched in 2017, challenging traditional banks in South Korea and forcing them to cut commission fees and revamp their online and mobile banking services.
Last September, the National Assembly passed a bill that allows a non-financial firm to boost its stake in an Internet-only bank beyond the 4 percent ownership ceiling.
The ceiling was intended to prevent big business conglomerates from exploiting a bank as their personal vault. However, critics said it has discouraged technology firms from making inroads into the financial sector.
(Yonhap)
