The financial authorities are set to reform the personal credit information consent system to promote the use of artificial intelligence (AI) financial services and alternative credit assessments. The aim is to reduce consumer inconvenience by minimizing the repetitive consent process required for financial transactions and to broaden the data utilization framework.
On June 16, the Financial Services Commission (FSC) held the kickoff meeting of the 'Legal Advisory Group for Reforming the Personal Credit Information Consent System' to discuss improvements to the consent system under the Credit Information Act.
Currently, the Credit Information Act requires individual prior consent at each stage of collecting, using, providing, and querying personal credit information. Financial institutions must specify the purpose of information use and the providers involved, and they must obtain consent again whenever there is a change in the provider or the type of information.
The FSC believes this structure increases consumer 'consent fatigue' and restricts the ability of financial institutions to utilize AI and data. For instance, when trying to use telecommunications and platform information for alternative credit assessments for thin-file borrowers with limited credit history, consent must be obtained again each time a new provider or information type is added. Similarly, for refinancing loan brokerage services, existing customers must re-consent if additional partner financial institutions are included.
This also poses obstacles to the introduction of AI financial services. If a bank wants to analyze assets from its affiliated securities and insurance firms using an AI chatbot, it must obtain new consent for information sharing among the affiliates. Services that utilize AI agents for interest rate reduction requests or refinancing loan execution are also limited due to the repetitive consent process for information queries.
Kwon Dae-young stated, "We need to fundamentally review the outdated 'fossil regulation' framework that has been in place for over 30 years since the enactment of the Credit Information Act in 1995."
Based on discussions from the legal advisory group, the FSC plans to refine the reform proposals for the consent system under the Credit Information Act and will gather opinions from financial consumers, the financial sector, and experts to push for legislative amendments to the Credit Information Act.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.