[1mm Financial Talk] The Original Group Account Is at Commercial Banks... But Kakao Bank Is 'Hahaha'

KakaoBank Group Account Screen

#Housewife Lee Hee-ae (49), who is running a travel savings group with neighborhood residents, has been using a KakaoBank group account since last year. Before using the group account, she managed it through a personal account and manually recorded the membership fees in a ledger, taking photos and uploading them to the KakaoTalk group chat, but now she shares balances and other information with members through the KakaoBank application (app). Requests for membership fees are also sent as messages with KakaoTalk emoticons in the group chat, making the conversation enjoyable.

Internet-only banks are smiling as they have taken over the ‘group account’ position originally pioneered by commercial banks. A group account is a kind of joint account concept. It is a service that allows members of clubs, social groups, etc., to share the usage details of an account where membership fees are collected. Commercial banks were the first to develop ‘group accounts’ to reduce the workload of treasurers, but they are now discontinuing these products as they fall behind internet-only banks in terms of convenience.

According to the financial sector on the 23rd, Woori Bank launched ‘Woori U Group Account’ in 2011 but has since stopped selling it, and Hana Bank also stopped new sign-ups for its ‘Group Account’ in February. Shinhan Bank’s group fee management service ‘Kim Treasurer’ has also been discontinued. KB Kookmin Bank operates the ‘KB Couple Account,’ but it is limited to two people as a couple account concept. NH Nonghyup Bank is one of the few still operating the ‘NH Gather Account.’

On the other hand, KakaoBank’s group account users recently surpassed 10 million. Since its launch in 2018, an average of 8,800 new users join daily. Especially as the group account has become a gateway for senior customers, KakaoBank is enjoying great success. Looking at the age distribution of KakaoBank customers, those in their 30s make up the largest portion at 34.7%, but the combined percentage of customers in their 40s (24.1%) and 50s and above (14.1%) reaches 38.2%. Toss also operates a similar service called ‘Collecting Money Together.’ All participants can check deposit and withdrawal details, and there is no limit on the number of participants. Toss Bank is also preparing to launch a separate ‘Group Account’ service.

KakaoBank’s group account has surpassed the original by greatly improving convenience and thanks largely to KakaoTalk, the nation’s messenger, which played a significant role. First, with commercial bank group accounts, the representative must prepare necessary documents such as meeting minutes and member lists and visit the bank. If group members are not bank customers, they must install certificates and sign up for the bank app, which is somewhat cumbersome. In contrast, KakaoBank’s group account’s biggest advantage is using KakaoTalk. Even without a KakaoBank account, members can be invited and join via KakaoTalk, and the representative can write notices or important information within the group account and share it immediately through KakaoTalk.

Regarding this, a banking industry official said, "With the emergence of fintech, outdated products have been discontinued due to market changes," adding, "Especially for group accounts, since KakaoTalk was integrated into the service, it was judged that they could not win the competition and are being phased out."