'Dinosaur' Naver Also Joins in Earnest... Competition in Loan Comparison Platforms Increases↑

Naver Launches Personal Credit Loan Comparison and Recommendation Following Business Loans
Expect Changes in the Three-Strong Competition Among Toss, KakaoPay, and Finda

[Asia Economy Reporter Minwoo Lee] The 'dinosaur' Naver is making a full-scale entry into the personal loan comparison market. Given its overwhelming platform capabilities, there are expectations that the competitive landscape, currently composed of Toss, KakaoPay, and Finda, could change significantly.

According to industry sources on the 1st, Naver Financial launched the 'Naver Pay Credit Loan Comparison' service on the 29th of last month. Users can easily submit income verification documents using Naver electronic certificates and check interest rates and limits close to actual screening results, allowing them to compare conditions by financial institution.

Already, 50 financial companies, including seven banks such as Woori Bank, Hana Bank, and Jeonbuk Bank, as well as savings banks, capital companies, card companies, and online investment-linked (P2P) finance businesses, have joined the platform. SC First Bank is also expected to be added within the year.

This follows the launch at the end of October of 'Naver Pay Business Loan Comparison,' the first in Korea to allow comparison of business credit loan products across all industries including banks. Just a month later, they introduced the personal credit loan comparison service. It is said that Naver has accelerated its efforts this year to enter the rapidly growing loan comparison market as soon as possible. According to the office of Kim Han-gyu of the Democratic Party, the number of financial product brokerage cases by Toss, KakaoPay, and Finda surged 368.5% from 172,842 cases in 2020 to 809,687 cases last year. This year, they brokered 712,454 cases in the first half alone.

With Naver's overwhelming platform dominance entering the market, it is expected that a major shift will occur in the loan comparison market. Until now, the domestic loan comparison service has been essentially a three-way competition among Toss, KakaoPay, and Finda. According to data on the 'Top 10 Savings Banks Credit Loan Status' submitted by the Financial Supervisory Service to Yoon Chang-hyun of the People Power Party, Toss held the highest market share at 48.8%, followed by KakaoPay at 23.2% and Finda at 16.9%.

Expanding partnerships with commercial banks will be key going forward. This can more reliably attract high-credit borrowers and improve the accuracy of loan product recommendations. Currently, KakaoPay and Toss have partnerships with Shinhan, Woori, and Hana Banks, while Finda is partnered only with Hana Bank. Naver starts with Woori and Hana Banks onboard. However, commercial banks are somewhat hesitant to collaborate with loan comparison platforms due to concerns about losing lending leadership to the platforms. KB Kookmin Bank and NH Nonghyup Bank, for example, do not provide their products on any loan comparison services as part of their efforts to strengthen their own platform competitiveness, reflecting the same concern.

Meanwhile, as the loan comparison market, currently focused on credit loans, expands to include mortgage loans, competition is expected to intensify further. Currently, Toss handles credit, business, and mortgage loans; KakaoPay handles credit and jeonse (lease) loans; and Finda handles credit, business, mortgage, and jeonse loans. Although there are specialized mortgage loan comparison services like Dambi, mortgage loan product comparison remains a relatively 'blue ocean.' A Naver Financial official stated, "Although no concrete plans have been made yet, the mortgage loan sector could be a strategic consideration in the future."