Amid growing controversy over internet banks' practice of 'cherry-picking' high-quality customers, Toss Bank has taken steps to improve its operations by hiring a strategy expert from Coupang. With the average credit score of its borrowers being higher than that of traditional banks, Toss Bank faces the challenge of expanding loans for low-to-medium credit customers while balancing profitability and soundness.
According to the financial sector on May 11, Toss Bank has created a new position for Chief Strategy Officer and appointed Im Seung-hyun to the role.
The establishment of this position aims to accelerate the company's overall strategy and strengthen its role as a strategic hub directly connected to various business departments. Born in 1985, Im has extensive experience in strategic planning at various platform companies, including Coupang and Deloitte Consulting.
Im is expected to prioritize the expansion of loans for low-to-medium credit customers. The proportion of such customers at internet banks has increased from 30% to 32% this year. On May 3, Kim Yong-beom, head of the policy office, criticized the practice of cherry-picking on Facebook, stating, "Cherry-picking is not the mission of internet banks."
As of the end of last year, Toss Bank's loans to low-to-medium credit customers accounted for 34.9% of its total. While this exceeds the government's benchmark of 30%, the bank has continued to focus on high-credit borrowers. According to the Korea Credit Bureau (KCB), the average credit score of Toss Bank's customers who received general credit loans last month was 930, higher than that of Shinhan Bank (911), Hana Bank (911), and Woori Bank (928).
Im's first task will likely be to reduce loans to high-credit customers or increase loans to those with lower credit scores to meet government demands. To increase loans for low-to-medium credit customers while maintaining soundness, enhancing alternative credit assessment models (CSS) will be necessary. Im is expected to leverage his data expertise to identify suitable low-to-medium credit borrowers.
Additionally, to support the continued expansion of loans for low-to-medium credit customers, it will be essential to bolster soundness through secured loans and corporate loans. Therefore, diversifying mortgage products and personal business loans will also be key responsibilities for Im this year.
Furthermore, he will need to explore ways to increase non-interest income and seek new business opportunities, such as stablecoins, to support reduced lending. Plans to enter the trust and retirement pension markets, launch direct fund sales, and expand financial services for senior customers are among the other challenges facing Im.
A financial industry source stated, "As the company enters its fifth year, it has reached a critical turning point," adding, "The creation of this position is aimed at accelerating progress in inclusive finance, non-interest income, new business ventures, and product partnerships."
* This article has been translated by AI.
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