FSC Launches Pilot-Run of Open Banking System in South Korea
FSC launched pilot-run of the open banking system in the banking sector. During the pilot-run period, the government will conduct a comprehensive assessment of the system and make adjustments if necessary before opening the system to fintech firms on December 18. At first, open banking will be offered by ten banks and it will be gradually expanded to the other eight banks and fintech businesses. The government had announced its plans to establish an open banking system in the country on February 25, 2019, to allow fintech firms the access to bank payment network through open Application Programming Interface (API) initiatives.
In 2020, the government will review an expansion of the open banking system to non-bank financial institutions, including mutual finance and postal service. The government plans to diversify API functions and will review a possible expansion to data sectors through an increased connectivity with My Data service. Fintech firms attempting to participate in the open banking system are subject to a security check by the Financial Security Institute. The storage capacity of the current operating system will be upgraded from 4TB to 60TB before the system becomes open to fintech firms and a 24-hour "Fraud Detective System" will closely monitor fraudulent activities and automatically shut down suspicious transactions.
The first ten banks to offer open banking will be NH Bank, Shinhan Bank, Woori Bank, KEB Hana Bank, IBK, KB Kookmin Bank, Busan Bank, Jeju Bank, Jeonbuk Bank, and BNK Kyongnam Bank. The eight institutions to be part of the further the gradual expansion are KDB, SC Bank Korea, Citibank Korea, SH Bank, Daegu Bank, Kwangju Bank, K Bank, and Kakao Bank.
Related Link: Press Release (PDF)
Keywords: Asia Pacific, Korea, Banking, API, Open API Framework, Fintech, Regtech, Pilot-Run, FSC
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