Financial Services Commission Prepares Digital Finance Innovation Tasks Including Accelerating Fintech Development

▲Accelerating Fintech Development ▲Promoting Contactless Financial Services ▲Building Financial Infrastructure

[Asia Economy Reporter Park Sun-mi] On the 28th, the Financial Services Commission (FSC) unveiled detailed tasks for digital financial innovation, including accelerating fintech development, promoting non-face-to-face financial services, and building financial infrastructure to support digital innovation.

According to the detailed tasks for digital financial innovation announced by the FSC on the 28th, the FSC plans to introduce a digital sandbox this year to accelerate fintech development. This is based on the judgment that early-stage fintech startups need opportunities for pilot testing to verify the innovativeness and business feasibility of new ideas before full-scale commercialization.

During the first half of this year, companies participating in the digital sandbox will be selected, and testing will be conducted between June and August. After the tests are completed, the following will proceed: ▲ notification of test results regarding participating companies' technology and business ▲ discussion of joint solutions for policy tasks ▲ improvement of the digital sandbox system.

This year, a bill to support comprehensive and systematic fintech development will also be prepared. It aims to establish institutional measures to promote fintech investment in the financial sector, provide a comprehensive support basis for the fintech industry, and create regulations to ensure a fair competitive environment in the fintech industry.

Additionally, to ensure sufficient funding support at each growth stage of fintech companies, policy finance and private investment support will be strengthened, and in response to the rapidly increasing demand for sandboxes, the FSC and the Financial Supervisory Service (FSS) will expand the functions and capabilities of their respective departments. Furthermore, the existing fintech support center will be enhanced to function as an institution performing multifaceted roles such as fintech startup support, linkage with policy finance, and comprehensive consulting.

A detailed plan to promote non-face-to-face financial services has also been prepared.

First, a plan to activate platform finance will be established within the first half of the year. Specifically, various institutional improvements will be pursued to ensure that platforms’ big data and data analysis capabilities are sufficiently utilized for small business loans and non-face-to-face financial services. Additionally, authentication and identity verification systems will be improved so that financial users can conveniently and safely use financial services in online and mobile environments. Regulations related to network separation and telecommuting will also be revised to facilitate smooth operations of financial companies and fintech firms in non-face-to-face environments. Financial users utilizing card and financial investment services will also be able to conveniently use one-stop online payment services through open banking without any setbacks.

Finally, efforts will be accelerated to build financial infrastructure supporting digital innovation. First, in the first half of the year, the 'Information Usage Consent Form' will be revamped and an 'Information Usage Grading System' will be implemented so that financial users can clearly understand and manage how their information is collected and used, as well as the risks involved in providing information. In the second half, consent form advancement will proceed based on financial sector IT development.

Infrastructure will also be established to allow financial companies, fintech firms, and various financial public institutions and heterogeneous industries (such as transportation and telecommunications) to easily combine and utilize accumulated data. The FSC plans to prepare cooperation measures with related agencies within the year regarding this matter. Institutional measures will also be established to enable small and medium fintech companies and financial firms to actively develop artificial intelligence (AI)-related services and for financial users to safely use them.