[Issue Interview] Lim Hanwook, CEO of Toss Payments: "We Will Expand to 50 Partners Like Apple Pay... Toss to Become B2B Hub"

Reduced Net Loss by 60% Within a Year of Financial Expert’s Appointment
Achieved Industry-Highest Cash-to-Settlement Ratio of Over 90%
Integrated with 11 Global Partners Including Apple Pay... "Aiming for 50"
Challenging to Shorten Merchant Payment Integration from Two Months to One Day

Lim Hanwook, CEO of Toss Payments, has expressed his ambition to increase the number of global partner companies from the current 11, which include Apple Pay and PayPal, to 50. Through this, he declared that Toss Payments will take the lead in the business-to-business (B2B) sector across the entire Toss community. The Toss community refers to the collective group of Toss's affiliates and subsidiaries. Toss Payments is the electronic payment gateway (PG) subsidiary of Viva Republica (Toss).

Domestic Leader with Over 90% Cash-to-Settlement Ratio

Im Hanwook, CEO of Toss Payments, is being interviewed by Asia Economy at the office on Teheran-ro, Gangnam-gu, Seoul. Photo by Jo Yongjun

In an interview with Asia Economy held on June 5 at the Toss Payments office in the Korea Intellectual Property Center in Yeoksam-dong, Gangnam-gu, Seoul, CEO Lim stated that the company has succeeded in solidifying its revenue structure and enhancing payment stability.

Lim, known as a 'finance expert,' joined Toss less than a year ago. In July of last year, he moved from Great Imagination (Yogiyo) to become the Chief Financial Officer (CFO) of Toss Payments. It has only been two months since he took on the CEO role. In this short period, he reduced the company’s net loss by 60%. In the first quarter, Toss Payments recorded a net loss of 4.3 billion KRW, which is about 40% of the 11 billion KRW loss from the same period last year. Based on EBITDA (earnings before interest, taxes, depreciation, and amortization), the company achieved a profit in the first quarter.

Beyond restoring financial health, Lim is establishing the highest level of payment stability in the PG industry. To prevent a recurrence of financial incidents like the 'TMEP (Tmon·Wemakeprice) crisis,' where customers did not receive settlement payments, Toss Payments has increased its cash-to-settlement ratio to over 90%, the highest in Korea. After the TMEP incident, the Financial Supervisory Service has been preparing self-regulation requiring PG operators to separately manage at least 60% of settlement funds.

Financial indicators such as debt ratio and liquidity ratio are also managed much more strictly than legal standards. According to the Electronic Financial Transactions Act and related supervisory regulations, electronic financial businesses must keep their debt ratio within 200% of their equity capital. The liquidity ratio must be at least 40%. While Lim did not disclose exact figures, he explained that the company maintains stability at levels much higher than these requirements.

Lim stated, "We apply much stricter standards than the law because we must always manage liquidity well and cannot afford to have excessive debt or issues with settlement funds," adding, "By significantly reducing net losses, we have demonstrated with numbers that we have the capability to continue operating stably without external support."

Goal: Connect with 50 Major Global Companies

Lim Hanwook, CEO of Toss Payments, is being interviewed by Asia Economy at the office on Teheran-ro, Gangnam-gu, Seoul. Photo by Jo Yongjun

Lim plans to significantly increase the number of major global payment integration contracts. Currently, 11 global companies, including Apple Pay and PayPal, are integrated with Toss Payments. Through partnerships with these companies, customers can conveniently make cross-border purchases (direct overseas purchases and sales). Lim stated that his goal is to increase the number of integrated global partners to 50, the highest among domestic PG companies.

Most popular online merchants in sectors such as fashion and secondhand trading, which consumers access via smartphones, are not electronic financial businesses with their own PG systems. These companies enter into integration contracts with PG operators like Toss Payments. While it is possible to contract directly with global services such as Apple Pay and PayPal without going through a PG operator, this approach is costly and requires significant changes to coding and integration systems, resulting in longer implementation times.

Toss Payments plans to increase the number of global partners like PayPal and Apple Pay to 50, enabling customers who have Apple Pay linked to their mobile phones to conveniently shop at domestic online merchants in sectors like fashion and secondhand trading.

For example, Toss Payments is integrated with Apple Pay, just like domestic simple payment services such as Toss Pay. This allows foreign tourists visiting Korea to make easy payments through Apple Pay when purchasing goods from online merchants (affiliated with Toss Payments).

Additionally, Toss Payments offers a 'payment widget' feature that allows merchants to freely adjust the card or simple payment user interface (UI/UX) according to their main customer base and business strategy. From the merchant's perspective, they often want to place the most frequently used card or simple payment brand at the forefront of the payment screen, which can be easily done with the payment widget. For example, if most customers use Hyundai Card or Toss Pay, these options can be placed at the very front of the payment screen. The payment widget is a clear differentiator for Toss Payments compared to competitors such as KG Inicis and NHN KCP.

Lim believes that the more global B2B customers Toss Payments attracts, the more it will benefit the overall management of the Toss community. He explained that Toss Payments, together with its payment terminal subsidiary Toss Place, can lead the entire B2B business for the Toss community.

He emphasized, "For customers secured by the Toss community to use more services within the Toss app, a variety of partnered B2B customers is necessary, and Toss Payments can serve as the 'hub.' By enabling the entire Toss community to utilize the B2B customer infrastructure of Toss Place, we will contribute to realizing Viva Republica's 'super app' strategy."

Goal: Integration on the Day of Merchant Contract

Lim revealed that he is developing a new payment integration method based on artificial intelligence (AI). While he could not disclose a specific launch date, he expects that development could be completed within a few months at the earliest.

Simply put, AI will learn the payment systems of online merchants (such as shopping malls) and Toss Payments, and then provide guidance to Toss developers and merchant owners. By advancing the application programming interface (API), the company aims to maximize server and system connection efficiency during the contract integration process.

Lim's ultimate goal is to build a system that can complete payment integration with online merchants 'within a single day,' compared to the current process that can take one to two months. Toss Payments believes that achieving such innovation would not only secure a leading position in the PG market share competition but also bring a fresh wave to the entire fintech (finance + technology) industry.

He said, "If Toss Payments' innovation succeeds, payments will be possible without the current complicated procedures of launching applications or undergoing multiple authentications. Our goal is to achieve 'instant open' integration with online merchants, completing what currently takes at least two weeks to as long as two months on the very day we meet."

Lim suggested that to properly implement innovation, the regulatory approach should shift from a positive system (everything is prohibited except what is allowed) to a negative system (everything is allowed except what is prohibited). According to the Financial Supervisory Service, as of April last year, there were 154 registered PG companies. The level of system advancement and financial stability among these companies varies widely. He expressed concern that applying the same regulations uniformly, without considering these industry differences, could diminish the innovation drive of companies with high technological standards and stability.

Lim pointed out, "Rather than applying the same regulations to all PG companies, it is necessary to apply the negative regulatory principle, giving companies with higher stability more opportunities to experiment with innovative products."