Kookmin Bank vs Kakao Bank, 'Leading Banking App' Competition... Commercial Banks Also in Fierce Battle

[Asia Economy Reporter Buaeri] Competition among banks in digital finance is intensifying. In the banking application (app) market, where KakaoBank has long held an overwhelming number one position, commercial banks are now closing the gap. Banks are fiercely competing to strengthen their monthly active users (MAU) in order to enhance platform competitiveness.

'Leading Banking App Competition'

According to Mobile Index, a big data analysis solution, KakaoBank and KB Kookmin Bank's Star Banking are competing for the top spot among banking apps. As of the end of July this year, KakaoBank's MAU stands at 13.19 million, maintaining its lead in the banking app market. KB Star Banking follows with 11.51 million MAU. Notably, KB Star Banking is the only app among the five major banks (KB Kookmin, Shinhan, Woori, Hana, NH Nonghyup) to surpass 10 million MAU. KB Financial Group has set a goal of reaching 15 million MAU for the Star Banking app this year, striving to surpass KakaoBank.

The growth of apps from major commercial banks is also remarkable. Shinhan Bank's app, 'Shinhan SOL,' recorded an MAU of 9.05 million in July, an increase of nearly 70,000 from the beginning of the year (8.98 million). Woori Bank's 'Woori WON Banking' recorded an MAU of 6.26 million during the same period. Woori Bank saw a surge of over 400,000 users after appointing singer IU as its model in April. This move, featuring an advertising model popular among the MZ generation (Millennials + Generation Z), has been highly effective. Woori Bank also aims to reach 10 million MAU by the end of this year. Hana Bank's Hana OneQ app has steadily increased its users as well. Its MAU, which was in the 4 million range, surpassed 5 million in March and reached 5.35 million as of July. NH Nonghyup Bank's 'NH Smart Banking' experiences monthly fluctuations but consistently maintains an MAU in the 8 million range.

The MAU of commercial banks' apps closely correlates with their customer base. As of the end of July, the number of customers for the five major banks is as follows: KB Kookmin 32.78 million, NH Nonghyup 32.45 million, Shinhan 26.65 million, Woori 24.97 million, and Hana 22.7 million. However, as digital finance becomes increasingly important, significant changes could occur depending on app competitiveness. With branch offices shrinking and non-face-to-face services expanding, the number of app subscribers and app usage time are long-term factors linked to customer acquisition.

Will Banks Launch 'Super Apps'?

Moreover, the recent announcement by the Financial Services Commission (FSC) regarding regulatory improvements has opened new opportunities for banks, which had previously faced restrictions on app integration and operation due to laws such as the Financial Holding Companies Act. Until now, banks could not create super apps like 'Toss,' which integrate banking, securities, and other services. Even when customers pointed out app inconveniences, meaningful improvements were difficult. However, regulatory reforms have paved the way for the emergence of 'super apps.'

On the 23rd, the FSC held the '2nd Financial Regulatory Innovation Meeting' and decided to interpret ancillary business flexibly to allow banks to provide various financial and non-financial services. It also announced plans to enable affiliated services such as insurance, cards, and securities to be offered through integrated apps. The FSC plans to allow holding companies to be entrusted with the planning, development, management, and maintenance of integrated apps.

A financial industry insider said, "Although it is difficult to integrate apps immediately, various possibilities toward a one-app system have opened up. With increased app scalability and activated information sharing among affiliates, offering diverse services beyond finance will enhance competitiveness, and platform expansion strategies similar to big tech companies can also be pursued."