South Korea Boosts Open Banking with New Initiatives

The Financial Services Commission (FSC) in South Korea has introduced two new policy measures aimed at advancing and broadening the accessibility of open banking services in the country, reports Informa Connect

Under the first initiative, there will be an expansion in the range of data accessible through open banking, covering both personal and business accounts. This enhancement will empower third parties utilizing open banking to conduct real-time, simultaneous inquiries across multiple accounts. The inclusion of business account data is specifically intended to empower financial services companies to introduce more tailored fund management products for their corporate clients.

The second initiative by the FSC aims to make open banking available offline, including through bank branches. This endeavor will enable account holders to utilize any bank or branch for services such as account inquiries and money transfers. South Korea currently operates two infrastructure systems to support its open banking initiatives. The first, the open banking service launched in December 2019, has become a crucial payment infrastructure for fintechs in the country, according to the FSC. The second, the API-based MyData service introduced in January 2022, serves as a government-backed hub allowing consumers to control how their data is utilized in open banking.

The FSC plans to develop a roadmap for the second generation of the MyData service, creating a platform where financial consumers can experience a wider range of services in a safer manner. Kim Soyoung, vice chairman of the FSC, acknowledges the achievements of existing systems in enhancing convenience for financial consumers and enabling innovative financial services. However, she emphasizes that the two new initiatives will further drive this progress, particularly by providing offline access for those currently excluded from financial services.