[Inside Chodong] Why the MyData Business Is Not Working

'An asset management service that analyzes my financial life and helps grow my money' vs 'A service I joined enticed by a Starbucks coupon but ended up neglecting.' These are the two perspectives on MyData that stirred the world early last year. The first is the original goal, and the second is the uncomfortable truth. According to the "Korea Financial Consumer Report" published annually by Hana Financial Management Research Institute, the number of people who answered that they "know about" MyData increased from 6 out of 10 last year to 8 out of 10 this year. The proportions of those who "have used" it and those who are "currently using" it remained similar at 5 out of 10 and 2 out of 10, respectively. Nothing improved even after a year.

Why has MyData been neglected? The reason is simple. It does not help increase my assets. This is a common problem among all MyData service providers. It is possible to integrate deposits, loans, investments, cards, and insurance so that consumers can view all this information at a glance. The problem arises after answering questions about investment preferences to save a lump sum. Whether the goal is to travel or prepare for retirement, the answer is predetermined. The recommended product is a fund. Moreover, only the company's own fund products are shown. It inevitably gives the impression of "advertisement," "business tactics," and "lack of trust."

Financial companies themselves are well aware of their weaknesses. Each commercial bank has invested hundreds of millions of won in building MyData infrastructure. MyData managers are eager to generate profits. The gap between ideal and reality is due to regulations. "For example, management should be done in a way that says, 'For customers who have stocks related to the metaverse, this stock is better, and besides the metaverse, here are other trending stocks that I will immediately link you to,' but we are blocked by regulations that only allow what the law stipulates, so we cannot even attempt it." (MyData manager at ○○ Bank).

The financial authorities suggest as an alternative that MyData service providers "apply more for innovative financial services," but even that is an easy thing to say for them. When applying for new ancillary or concurrent businesses using MyData, it takes at least six months and sometimes over a year to decide on approval. This is why financial companies say, "If we want to launch new MyData services crossing different areas, we need negative regulations that say 'do everything except this one thing.'"

MyData business is also neglected within the companies. These days, banks are reducing MyData staff and investments. Banks make maximum profits during interest rate hikes, so there is no reason to pay attention to MyData, which does not generate profits. The sentiment of the managers is, "The higher-ups tell us to find ways to produce results, but except for intermediary services like refinancing loans, we haven't tried anything yet, so it's frustrating."

The financial authorities need to pull the door handle of the half-opened "digital asset management." "It organizes subscription service lists and payment amounts like Netflix monthly, quarterly, and planned. Services that are rarely used can be canceled directly from the bank app." (ABN AMRO) "It manages credit scores, which have the greatest impact on loans. It shows monthly personal financial data linked with credit score improvement plans and credit score change graphs. It also suggests options for interest rate reduction, early repayment, extension, and refinancing." (Wells Fargo) Only then can these overseas MyData cases become stories in our country as well.