Journalist
KIM JIYOON
yoon0930@ajunews.com
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Online P2P lenders seek looser investment caps as cumulative loans near 20 trillion won Online investment-linked finance firms, known as on-tu-eop, are calling for deregulation — including higher investment caps for retail investors — to improve profitability and expand inclusive finance. With cumulative lending nearing 20 trillion won, the sector is increasingly seen as an alternative source of credit, drawing attention to whether talks on easing rules will gain momentum. According to the financial industry, the sector held a policy forum at the National Assembly on March 26 under the theme of measures to revitalize online investment-linked finance. The business connects investors and borrowers through online platforms. Investors participate in loans and earn returns through claims to principal and interest. After the relevant law took effect in 2020, the sector was brought into the regulated financial system. Recently, through linked investments with savings banks, firms have supplied midrate credit loans averaging in the 12% range to borrowers in the bottom 50% of personal credit scores, serving as a channel for working-class lending. At the forum, participants highlighted the need to broaden institutional investor participation and raise investment limits for individuals. Institutional investors are currently capped at 40% of investment per loan. The limit for general retail investors is 40 million won, while products tied to real estate-collateralized loans are capped at 20 million won. Lee Hyo-jin, CEO of 8percent, said the sector differs from traditional banks because it relies on transaction fees rather than net interest margins, meaning higher volume directly supports growth. “If we expand transaction volume through easing investment regulations, a virtuous cycle is possible — more funding supply, lower rates and stronger demand,” Lee said. He added that improving the operating environment is needed to meet policy goals such as spreading inclusive finance and supporting financial innovation. Speakers also called for expanding the scope of loans eligible for linked investment by lending institutions. Lee Jung-min, an attorney at Kim & Chang, said linked-investment products are currently limited to personal credit loans where risk can be managed. “Given the purpose of the On-tu Act to supply midrate financing to blind spots in lending, the scope should be expanded to include loans to sole proprietors, where funding demand is high,” he said. Other proposals included easing limits on on-tu firms’ own-capital investments and restructuring investment frameworks. Financial authorities and some experts urged caution. Jeong Seon-in, director of digital finance at the Financial Services Commission, said investment risks can emerge years later, requiring a careful approach. “Efforts to strengthen qualitative management and build trust must go hand in hand,” Jeong said. Seo Byeong-ho, head of the Financial Innovation Research Division at the Korea Institute of Finance, noted that deregulation such as raising minimum capital requirements was implemented in 2022 and 2023, and said the focus now should be on boosting trust, including stronger disclosure. 2026-03-26 15:24:00 -
Survey: 7 in 10 South Korean fintech firms operate without e-finance registration South Korea’s payment gateway (PG) industry is expanding rapidly, but about seven in 10 fintech companies are operating without registering as an electronic financial business, a new survey found. Despite tighter oversight of PG operators, many firms still take part in payment functions outside the regulatory system, raising concerns about blind spots in supervision. According to the Korea Fintech Industry Association’s “2025 Fintech Industry Survey,” released Monday, only 32% of 322 surveyed fintech companies were registered as electronic financial businesses. Another 64.3% were operating without registration, and 3.7% said they were considering registering. The association said this was the first time results of a full survey on fintech firms’ registration status had been made public. The survey covered a wide range of fintech fields — including payments, wealth management, insurtech and IT and solution providers — so the unregistered share does not necessarily equal the unregistered share among firms that are required to register. Under the Electronic Financial Transactions Act, businesses that provide services such as simple payments, prepaid top-ups and settlement must register with financial authorities. Operating without registration can be punished by up to three years in prison or a fine of up to 20 million won. Critics have said the law’s narrow definition of PG business leaves gaps, including for “dual-business” PG operators that run their main business — such as online marketplace brokerage — while also handling settlements as a side activity. Industry officials also argue that registration requirements — including capital, staffing and security systems — can be a high barrier for early-stage startups. Some companies say they only provide technology and do not directly control the flow of funds, and therefore interpret themselves as not subject to registration. Registration rates varied sharply by industry. Financial-sector firms, which have traditionally provided financial functions, showed a 59.2% registration rate. By contrast, information and communications firms and software/IT firms posted rates of 13.9% and 20.5%, respectively. The report attributed this in part to IT-based companies defining their services as “technology services” while in practice performing PG-like functions such as accepting payments or handling settlements without registering. The report warned that as platform-based payment ecosystems expand, more businesses are becoming involved in payment and settlement processes while remaining outside the scope of electronic financial business registration, increasing the risk of consumer harm. On some online platforms, consumers may feel they are paying through the platform itself, but settlements are often handled by a separate PG firm or financial institution. When payment delays or refund disputes arise, users may struggle to identify who is responsible, delaying relief, the report said. The report also found growth in “PG-like” firms that remain outside regulation, particularly among electronic financial support providers — which assist financial institutions with IT systems, data processing, security and authentication — and among “third-tier PG firms.” It defined third-tier PG firms as reseller or agency-type businesses that re-sell services based on contracts with second-tier PG firms. A fintech industry official said that when businesses in the regulatory gray zone cause incidents, the fallout can spread across the entire industry. The official called for steps to improve transparency, including tightening rules to bring gray-zone operators into the system or blocking unqualified firms from entering the market. 2026-03-24 10:03:07 -
Why South Korea’s Internet Banks Sat Out Bank of Korea’s ‘Project Hangang’ CBDC Test As the Bank of Korea moves ahead with the second phase of its central bank digital currency experiment, known as “Project Hangang,” attention is turning to why South Korea’s internet-only banks are not taking part. Industry officials cite weak profitability, high upfront costs and limited interoperability as key factors that reduced incentives to join. According to the financial sector on Thursday, the country’s three internet banks did not express an intention to participate in the second-phase program. Project Hangang is a test in which the central bank issues a blockchain-based “wholesale digital currency,” and private banks distribute it as a payment instrument called “deposit tokens,” allowing consumers to use them in everyday transactions. Nine banks will participate in the second phase: the seven banks that joined the first phase — KB Kookmin, Shinhan, Woori, Hana, IBK and NH NongHyup, and Busan Bank — plus Kyongnam Bank and iM Bank. Kim Dong-seop, head of the Bank of Korea’s digital currency planning team, said at a briefing the previous day that the central bank did not proceed by selecting some banks and excluding others. He said internet banks likely had “various considerations,” including internal circumstances and priorities. Industry observers say the project’s unclear revenue model, combined with heavy initial infrastructure spending, likely discouraged participation. They argue that while a privately led stablecoin market can create both a risk of losing deposit customers and an opportunity to capture a new market, the central bank’s model does not present banks with a clear profit structure. During the first real-transaction test, conducted for two months starting in April last year, the seven participating commercial banks were reported to have spent nearly 35 billion won on infrastructure such as computer systems and on marketing for the project. Skepticism also remains over user convenience. The central bank says it simplified payment procedures in the first phase by introducing features such as biometric authentication. But internet banks and big tech firms that already offer advanced “face pay” and other streamlined payment services do not see it as a distinct innovation, according to industry assessments. Criticism has also focused on the technical design. The Bank of Korea expects distributed ledger technology, including blockchain, to help prevent misuse of deposit tokens. However, industry officials argue the system is effectively centralized and could paralyze the entire payment network if problems arise at the central bank. Internet banks say they will monitor market reaction to the second test before deciding whether to join later, but many in the industry expect participation is unlikely. One industry official said the first project failed because it lacked interoperability. “If the goal is a digital currency that works globally, linking with dollar stablecoins and the like is important, but the second project also has no interoperability,” the official said. The official added that there are no internationally successful cases of a centralized deposit-token system based on a permissioned blockchain, and said banks have reason to be cautious because the revenue model and operating costs are uncertain and could become a “sinkhole of sunk costs.”* This article has been translated by AI. 2026-03-19 17:03:00 -
KakaoBank Cuts Rates on Real Estate-Backed Loans for Sole Proprietors to Low 2% Range KakaoBank said on 17 it will cut interest rates on its “real estate-backed loans for sole proprietors” by as much as 0.75 percentage points to ease financing burdens for small business owners. The bank said it will lower loan rates by up to 0.60 points and expand its preferential rate discount to 0.30 points a year from 0.15. With both applied, the minimum rate is 2.895% a year. KakaoBank said it is the only financial firm offering rates in the 2% range among banks providing real estate-backed loans to sole proprietors. KakaoBank launched the product in October last year. It can be used non-face-to-face for up to 1 billion won for purposes including business operating funds and purchasing a business site. Some industries, including residential building development and supply and residential building rental, are excluded. “We further lowered rates on our real estate-backed loans for sole proprietors to expand financial support for small business owners struggling to raise funds,” KakaoBank said, adding it will continue to introduce innovative financial services to improve convenience for sole proprietor customers.* This article has been translated by AI. 2026-03-17 08:42:00 -
Korean Internet Banks’ Boards Rarely Dissent Despite 70% Outside Directors South Korea’s internet-only banks have boards where outside directors make up nearly 70%, yet most agenda items are still approved unanimously, according to a review of recent filings. Over the past three years, Toss Bank recorded the most dissenting votes, but only six in total. Industry observers say the boards’ oversight role is unlikely to strengthen unless the process for recommending outside directors changes. An analysis of the past three years of “annual reports on governance and compensation systems” for the three internet-only banks — Toss Bank, K Bank and KakaoBank — posted on the Korea Federation of Banks website showed Toss Bank had five dissenting opinions last year and one in 2024, for six overall. At Toss Bank, five dissenting opinions were recorded among 119 board resolutions last year. Four were raised at a January board meeting by Lee Kun-ho, an outside director and a former KB Kookmin Bank president. Lee opposed approval of a 2025 stock option grant plan; convening a first extraordinary shareholders meeting in 2025 and setting the record date; approval of canceling stock option grants; and an agenda item to revise internal rules. Since launching in 2021, Toss Bank has granted stock options to employees in 19 rounds through September last year. In April last year, it introduced a program allowing employees to swap part of their year-end bonus (1 million won) for stock options. The stock options included a condition barring resignation for two years, and 372 of about 700 regular employees reportedly chose the program. The industry has speculated that disagreements may have surfaced on the board during the process of adopting the program. K Bank, despite having the highest outside-director ratio at 73%, had no dissenting votes on board resolutions over the past three years, the analysis found. KakaoBank recorded two dissenting opinions over the same period. In 2023, outside director Lee Eun-kyung opposed agenda items on support measures for victims of rental fraud and approval of revisions to a shared-growth agreement. There was also one case in which an item was put on hold: In June last year, directors agreed to defer a proposal on an affiliate contract for employee corporate and welfare card use, citing the need for additional review and discussion. The resolution was later taken up at the eighth board meeting. Kim Dae-jong, a professor in the business administration department at Sejong University, said outside directors are selected by bank employees, creating a structure in which “they have no choice but to agree close to 100%,” making dissent effectively difficult. 2026-03-12 15:18:00 -
Naver Pay Launches NFT-Based Community Features in Npay Wallet Naver Pay said on March 12 it has launched a new community service based on non-fungible tokens, or NFTs, within its non-custodial digital asset wallet, Npay Wallet. Npay Wallet is a digital asset wallet designed to securely store digital art, tickets and certificates. The new Npay Wallet Community is built around NFTs and is intended to let users connect through shared interests. In the community's "channels," users can freely discuss specific topics, including Jeju Island's digital tourism pass, "Nauda," and game streams on Naver's streaming service, "Chzzk." By contrast, "ticket verification rooms" are operated as closed groups open only to holders of tickets and related NFTs for specific performances or events, including the KLPGA (Korea Ladies Professional Golf Association). The company said the goal is to help attendees form communities and increase engagement and a sense of being on site. Naver Pay said it plans to expand the community to additional content areas, including sports, games and performances, using NFTs. Starting March 31, it plans community events tied to Chzzk game broadcasts to offer a participatory experience that combines watching matches with fan interaction. To mark the launch, Naver Pay is also running an open promotion. Users who complete three missions in the community — liking posts, leaving comments and writing posts — can receive 1,000 won in Npay points. Those who post NFT verification content will be entered in a drawing for up to 50,000 won in additional points. An official at Naver Pay said, "Npay Wallet will expand beyond a digital wallet that stores NFTs into a platform that also provides community experiences where various events and fandom activities take place." * This article has been translated by AI. 2026-03-12 14:33:00 -
Toss Bank Cancels Yen Exchanges After App Shows Wrong Rate Toss Bank, known for promoting innovative technology, posted incorrect foreign-exchange information due to a computer error, prompting financial authorities to look into what happened. The bank said it canceled related currency-exchange transactions and began checking its systems. According to the financial sector on March 11, the Toss Bank app displayed the exchange rate for 100 Japanese yen as 472 won — instead of the normal 932 won — for about seven minutes starting at 7:29 p.m. on March 10. After recognizing the problem, Toss Bank temporarily suspended yen exchanges. During that period, an in-app alert told users the yen had hit its lowest level in three months, and some users proceeded with exchanges, according to reports. Toss Bank estimates the volume of transactions tied to the error at about 10 billion won. A Toss Bank official said the error occurred during work to inspect and improve its foreign-exchange system and that all exchange transactions executed during the affected period would be canceled. The bank cited Article 8, Paragraph 3 of the Electronic Financial Transactions Act, which allows financial companies to correct or cancel transactions caused by mistakes such as system failures or input errors. Similar cases have occurred before. In 2023, an input error involving the Vietnamese dong (VND) exchange rate at Hana Bank was deemed an obvious mistake and the transactions were ruled invalid. Toss Bank said the rate was displayed far below normal levels and that users did not suffer financial harm. Financial authorities, however, are reviewing the circumstances and the bank’s internal control procedures. The Financial Supervisory Service is conducting an on-site inspection of Toss Bank. An FSS official said inspectors are confirming the facts and will examine the cause of the incident and internal management procedures. 2026-03-11 15:51:00 -
Korea’s Internet Banks Gear Up for Check Cards for Kids as Young as 7 Competition among South Korea’s internet-only banks and fintech firms is intensifying as the minimum age for getting a check card is set to drop, effectively opening the market to children in the so-called Alpha generation, born in 2010 or later. The Financial Services Commission is pushing a 시행령 revision in May to improve youth access to financial services by lowering the eligible age for check card use to 7 and older, from 12, the financial industry said Monday. In response, the country’s three internet-only banks are expanding teen-focused products and promotions. The goal is to move beyond a model in which parents open and manage cards and savings accounts for their children, and instead let teens experience everyday money management directly through app-based services. KakaoBank, for example, has been running a “Teens Bonus” promotion since March 5 through its youth service, “KakaoBank mini.” It offers three daily random cash-back benefits for payments at teen-friendly merchants such as Daiso, Artbox and Mega MGC Coffee. K Bank is leaning into gamification, promoting services such as “Money Mission,” which pays rewards when users complete in-app tasks, aiming to boost motivation and engagement among young customers. Toss plans to introduce a “youth mydata” service, the first such offering in the fintech industry, it said. Toss said teens accounted for 12% of its customers as of 2025. Its affiliate Toss Bank offers an under-14 “Youth Card” and “Youth Home,” with features such as an allowance ledger and a digital piggy bank designed for easy use. Financial companies see teen adoption of internet banks and fintech platforms as a way to secure “future customers,” betting that a first finance app used in adolescence can carry into adulthood. Overseas firms are also moving aggressively into the teen market. In Canada, RBC runs the allowance-management app Mydoh, which lets parents assign chores and pay allowances when children complete them. RBC also encourages customers ages 6 to 14 to transition over time to student and then adult accounts. In the United States, fintech firm Greenlight goes beyond savings and check cards by offering access to stock and exchange-traded fund, or ETF, accounts, positioning it as an early investing education tool. “Today’s youth are a generation whose daily routines — from taking the bus to buying meals and going to after-school academies — are all tied to financial transactions,” an official at an internet-only bank said. “The younger they start building structured economic education and financial experience, the better, so competition in services will only intensify.”* This article has been translated by AI. 2026-03-10 16:12:00 -
CAS Rejects Ukrainian Skeleton Racer Heraskevych’s Appeal Over Memorial Helmet Ban Ukrainian skeleton racer Vladyslav Heraskevych, 27, will not compete at the 2026 Milan-Cortina Winter Olympics after the Court of Arbitration for Sport rejected his appeal of an International Olympic Committee ban, the AP reported. The IOC barred him from competing after he sought to race wearing a “memorial helmet” honoring teammates killed in the war. CAS upheld the IOC decision under Olympic Charter Rule 50.2, which says “no kind of demonstration or political, religious or racial propaganda is permitted in any Olympic sites, venues or other areas.” CAS said it fully sympathized with Heraskevych’s intent and his effort to highlight the suffering of Ukrainians and Ukrainian athletes during the war, but ruled the ban was “reasonable and appropriate.” Heraskevych’s side protested the ruling, arguing it was inconsistent with how other athletes were treated. The article cited examples from the Games: U.S. figure skater Maxim Naumov showed photos of his parents who died in a plane crash last year; Italian snowboarder Roland Fischnaller competed wearing a helmet that included a Russian flag image; and Israeli skeleton racer Jared Firestone wore a kippah bearing the names of 11 Israeli athletes and coaches killed at the 1972 Munich Olympics. The IOC said those cases did not violate the rules. IOC spokesman Mark Adams said Naumov displayed the photos in the kiss-and-cry area, not during competition; Fischnaller’s helmet honored all Olympic host cities where he had competed, including the 2014 Sochi Games; and Firestone’s kippah was covered by a beanie. After the decision, Heraskevych said, “The IOC is on the wrong side of history.” He had previously lost his Olympic spot after trying to compete in the men’s skeleton event wearing a helmet with the faces of fallen teammates. “The sacrifice of the athletes who died is why we could be here competing as one team,” he said. “I can’t betray them.” * This article has been translated by AI. 2026-02-14 11:18:00 -
Lim Jong-hoon-Oh Jun-sung, Kim Na-young-Yoo Han-na reach WTT Star Contender Chennai finals South Korea’s doubles teams Lim Jong-hoon-Oh Jun-sung (both Korea Exchange) and Kim Na-young-Yoo Han-na (POSCO International) advanced to the finals at WTT Star Contender Chennai 2026, keeping alive the chance of a double title run. Lim and Oh beat India’s Harmeet Desai and Sathiyan Gnanasekaran 3-0 (11-2, 11-3, 12-10) in the men’s doubles semifinals on Feb. 13 local time in Chennai, India. After taking the first two games comfortably, the Koreans were pushed to deuce in the third but closed it out 12-10. The pair, who won last year’s WTT Star Contender events in Muscat and Skopje, will play France’s Thibault Poret and Flavien Coton in the final as they seek another title. In the women’s doubles semifinals, Kim and Yoo defeated India’s Hadi Patel and Laxita Narang 3-0 (11-4, 11-4, 11-6). Ranked No. 4 in the world, Kim and Yoo won three titles last year in Taiyuan, Lagos and Skopje. They will face Japan’s Sakura Yokoi and Sachi Aoki in the final. In singles, five South Koreans reached the round of 16: Oh Jun-sung and Park Kang-hyun (Mirae Asset Securities) in the men’s draw, and Kim Na-young, Joo Cheon-hee (Samsung Life Insurance) and Lee Eun-hye (Korean Air) in the women’s draw. 2026-02-14 09:30:00