Kakao debuts its payment platform

Daum Kakao, the Korea Financial Telecommunications and Clearings Institute (KFTC) and 13 Korean banks yesterday launched BankWalletKakao, a mobile service for transferring money via KakaoTalk.

Users of KakaoTalk, the nation’s leading mobile messenger, can link their BankWalletKakao account with up to 25 cards and one “Bank Money” account to manage transfers, on and offline payments, and to make withdrawals from ATMs.

The service will be available for Android and iOS, and the 13 banks and KFTC will oversee the transactions.

BankWalletKakao’s main purpose is to transfer “Bank Money” from a virtual Kakao-linked account that the app user links to their own bank account. Users can also withdraw money from an ATM with what Daum Kakao calls a “Mobile Bank Card” and can make payments at stores that accept the service.

Payments can be made with Bank Money by clicking the “charge” button after a bank account is linked with the Kakao service.

Users can choose between two Bank Money options. They can register their bank account and PIN number after completing an authentication process or register on the BankWallet site first.

The app can also be used to transfer money to KakaoTalk friends by clicking the “send” button. Under the “my account” section, users can send the Bank Money funds stored in their Kakao account back to their original bank account. Commission fees on transactions differ by bank.

Daum Kakao said that transfers through Bank Money are more convenient than regular mobile banking.

According to Kakao, BankWallet users can send up to 100,000 won ($91) the same way they would send a message to a KakaoTalk friend, even without knowing the recipient’s bank account number. “This ease of use and convenience is expected to help the service attract wide popularity among users for sending and receiving cash gifts and splitting bills,” said a Daum Kakao spokesman.

Initially, up to 500,000 won can be deposited into a BankWallet account, and a person cannot send or receive more than 500,000 won per day.

Based on demand, the fund limit could be adjusted in the future, the company said.

BankWallet users can also make on and offline purchases using their Bank Money and Mobile Bank Card.

Currently, users can make online purchases using Bank Money at KakaoTalk’s Gift Shop, Aladdin and Hanssem Mall, and major offline retailers including CU, E-Mart, 7-Eleven and Shinsegae and AK Plaza department stores.

Mobile Bank Card can be used at over 75,000 ATMs that have BankWallet or UbiTouch stickers.

Daum Kakao said BankWallet is very secure because transaction data is encrypted for all payments and transfers and all banking is conducted through the established security systems of financial institutes.

In order to protect against SMS phishing and related fraud, transfer notification messages are sent through KakaoTalk and must be authenticated by the receiver.

“BankWalletKakao is a next-generation service that combines fund transfers, online payments and ATM cards, and users will be able to experience banking services in a whole new way,” said a spokesperson for Daum Kakao and the KFTC.

“We hope BankWalletKakao’s security, convenience and availability can lay the foundation for greater innovation in the Korean mobile banking industry.”

KakaoTalk has 37 million users in Korea and BankWalletKakao is open to users aged 14 or older who have an Internet bank account and a smartphone registered in their own name.

Authentication is required, so the app does not work with devices registered to corporate accounts or with some MVNO phones.

BY KIM JUNG-YOON [kjy@joongang.co.kr]