[Asia Economy Reporter Bu Aeri] Kakao Pay, a leading financial platform, recently did not attend a financial platform meeting citing "internal circumstances," sparking speculation within the industry about the reasons behind this decision.
According to financial authorities on the 1st, Jeong Eun-bo, Governor of the Financial Supervisory Service, held a meeting with financial platforms on the 26th of last month at the Bank Federation in Myeongdong, Seoul. Attendees included Choi In-hyuk, CEO of Naver Financial, Lee Seung-geon, CEO of Viva Republica, the operator of Toss, and key executives from KB Financial Group, Shinhan Financial Group, and Hana Financial Group. However, Kakao Pay, one of the two major big tech players, was notably absent. Kakao Pay has been recognized as a leading innovator by offering convenient services such as simple payments and remittances based on KakaoTalk, the national messenger. This absence led to criticism regarding Kakao Pay's lack of communication efforts.
However, Kakao Pay is currently facing internal turmoil that has not been fully resolved following recent moral hazard controversies involving key executives, making it difficult for the company to appear in public forums. On December 10th last year, eight key executives of Kakao Pay, including CEO Ryu Young-jun, sold 90 billion KRW worth of Kakao Pay shares. This sparked a "scam controversy" among employees, and the labor union demanded Ryu's resignation, causing unrest within the Kakao community. This incident also dealt a blow to the entire Kakao affiliate group. Last year, Kakao faced unprecedented situations with Chairman Kim Beom-su of the Kakao Board of Directors appearing three times at the National Assembly audit due to controversies over neighborhood market infringement and monopoly issues. Kakao had been striving to restore a positive corporate image this year by promoting "coexistence" company-wide, but before this effort could begin, another "incident" occurred within an affiliate. Moreover, Ryu was already designated as the next CEO of Kakao.
Ultimately, CEO Ryu expressed his intention to voluntarily resign, and the Kakao Pay executive team began a reorganization process. Ryu stepped down from his position as CEO of Kakao Pay, which was scheduled until March, and Jang Ki-joo, Vice President of Business Planning (CFO), and Lee Jin, Vice President of Business Operations (CBO), also resigned taking responsibility for the recent situation. With key executives stepping down, there was no suitable representative to attend the financial platform meeting on behalf of the company. Furthermore, Shin Won-geun, the designated CEO, is also involved in the controversy, making it difficult for him to appear at a media-heavy event.
Kakao Pay currently prioritizes internal reorganization over external activities. With the CFO and CBO stepping down, the leadership structure needs to be reestablished, and internal morale must be restored. Shin, the designated CEO, has pledged to stay and do his best to manage the situation. Shin stated, "I will repurchase the shares sold and, if appointed as CEO, will not sell any shares during my term," adding, "I will return to the original mindset when Kakao Pay was first launched and make every effort to regain the trust of customers and shareholders."
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