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[MTN News] Column | Memories of 'Cheonsongi Coat'... 'Deregulation' sparked by fintech

[Source] MTN News 07-06-2023 08:30:01

column | Memories of 'Cheonsongi Coat'... 'Deregulation' sparked by fintech

In the mid-2010s, the digital transformation revolution began belatedly in the financial sector as well. Fintech led the change, and open banking, block chain, and artificial intelligence that appeared later have advanced financial services and established themselves as catalysts that will change the existing financial industry. Money Today Broadcasting sheds light on the footsteps and future of the financial industry, which is speeding up its evolution, through a series of columns by Kim Bong-kyu, director of the Digital R&D Center at NH Nonghyup Bank. While working at Nonghyup Bank, Director Kim Bong-kyu planned Open API, the predecessor of open banking, for the first time in Korea, and grafted various Fourth Industrial Revolution technologies such as blockchain and big data into financial services. Currently, blockchain technology company zkrypto is seeking the possibility of a future financial solution to respond to the Web 3.0 era.

When it comes to fintech in Korea, there is an incident that comes to mind. It became a hot topic in April 2014 when former President Park Geun-hye mentioned the coat worn by a female lead in a public television drama in a debate on regulatory reform. Chinese fans tried to buy a Cheon Songi coat on a Korean shopping mall site, but they said they could not purchase it because of the official certificate, and ordered countermeasures. repealed the rule.

Kim Bong-kyu, Director of

zkrypto Research Center

(Executive Director)

Then why is this event recognized as a symbolic event of fintech? Around this time in 2014, overseas fintech companies were already creating successful cases, and research on this new trend was in full swing in Korea as well. At that time, the financial sector also had to find a way for each bank to respond to fintech, but rather than a fundamental response, it was a formal response that packaged a collaboration service model with tech companies as fintech and competitively promoted it.

However, 'Cheon Song-i Court' served as a 'trigger' to change the overall atmosphere. In a word, the accredited certificate system emerged as an issue that must be improved for the expansion of the e-commerce market, and from then on, deregulation in the financial industry began to be recognized as a natural process for the expansion of the fintech industry.

As a result, Kakao Pay, a representative domestic fintech service, was launched in September of that year. This service will later become a symbolic service for easy payment. After installing plug-ins such as existing ActiveX or keyboard security programs, the inconvenience of having to enter the card number and password every time you make a payment is eliminated. I did it. After its release, it was evaluated that it drastically reduced the payment process time in the e-commerce market, and the number of subscribers exceeded 4 million within 6 months, and the number of payments exceeded 10 million at the point of one year.

This atmosphere makes a great contribution to the expansion of the e-commerce market and gives birth to expectations that fintech may bring new vitality to the financial industry. With such expectations and global trends, in January 2015, the following year, the Financial Services Commission announced plans to support IT and finance convergence. This was the first declaration that the government would shift the regulatory paradigm. What was announced at this time is the establishment of an internet-only bank model, allowing non-face-to-face identity verification, introducing crowdfunding, and supporting the use of big data, which are already being implemented. It gave me a fresh shock.

As a result, the financial sector has created its own dedicated fintech team and is contemplating various fintech strategies to respond in earnest. At this time, 'open innovation', which means collaboration with fintech companies, became an important strategy for all financial sectors, and commercial banks competed to find fintech companies by launching fintech cooperation centers competitively.

In the early days, this type of cooperation center operated by the financial sector was aimed at discovering and collaborating with fintech companies. . The FinTech Support Center under the Financial Services Commission was also launched at the government level for the purpose of supporting these fintech companies. A representative company that has grown in this atmosphere is Toss, a symbol of Korean fintech startups.

The atmosphere of deregulation to nurture the fintech industry led to full-scale deregulation attempts, starting with the IT-finance convergence support plan, and in March 2020, the 'revision of the 3 data laws' representing 'Deregulation' will come to fruition. It is hoped that this will be recorded in history as an important law revision for Korea's electronic finance to the era of data finance.

Also, on December 10 of that year, the public certificate system known as 'Cheon Songi Court' was officially abolished due to the revision of the Enforcement Decree of the Electronic Signature Act. The Electronic Signature Act went into effect in July 1999, went into effect in 2018 as an amendment, and finally came to an end after more than 20 years. I want everyone to remember that the atmosphere of deregulation created by the 'Cheon Song-i Court' has become an important turning point in the development of Korea's fintech industry.

Cho Jeong-hyun Money Today Broadcasting MTN Reporter

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