FSC chairman promises significant fintech support

FSC Chairman Eun Sung-soo tests some of the fintech technologies exhibited at the Korea Fintech Week held at Conrad Hotel in Yeouido on Wednesday. [FINANCIAL SERVICES COMMISSION]

Eun Sung-soo, the Financial Services Commission (FSC) chairman, promised support to accelerate the innovation of digital finance and fintech companies, especially through it D-testbed, a regulatory sandbox exclusively for fintech start-ups.

“The government will allow fintech start-ups to operate on the D-testbed, even at the very early stages,” Eun said Wednesday at the event, which is being held at the Conrad Hotel. “They will have opportunity to test their new business ideas virtually using real financial data.”

The D-testbed is a program in which the financial authority will pick 20 fintech companies by July and offer them a wide range of support, which includes the lifting of regulations so the start-ups will be able to test their ideas for commercialization.

In November, the FSC will hold an exhibition that will demonstrate the results of the program, and the services developed will be evaluated by industry experts before being fully rolled out for commercial use.

During his opening speech, the FSC chairman added that the government is also currently working on guidelines on the use of artificial intelligence in financial services.

“Fintech has dramatically transformed the landscape of the global financial industry,” Eun said. “The market capitalization of some fintech companies is higher than those of traditional financial leaders.”

The FSC chairman stressed the efforts that the Korean government has made in laying the groundwork for fintech innovation, which includes building the digital innovation infrastructure and allowing the flexible use of data and regulatory sandboxes that contributed in launching 82 fintech companies in the last two years.

“In the meantime, we have reinforced the foundation for financial stability, by securing payment systems, protecting financial consumers and ensuring digital security,” Eun said.

The FSC chairman said the government will continue on its current course “boosting” fintech growth and “spurring” digital innovation.

“We plan to improve the legal framework to promote investment in the fintech industry,” Eun said.
He said the government will ease regulations for conventional financial institutions so that investment in fintech will increase.

On cryptocurrency investment, the FSC chairman said the financial authority is protecting investors through regulations that will be implemented in September that will require all cryptocurrency operators to register with the government and only allow exchange through accounts opened under a person’s real identity.

“Investors should transfer all of their cryptocurrency to safe exchanges before September when the Act on Reporting and Use of Certain Financial Transaction Information goes into effect,” Eun said.

The FSC chairman said the police are in charge of investigating cryptocurrency fraud and not the FSC.

“My understanding is that the police have investigated over 200 cryptocurrency frauds in the last three years,” Eun said. “The government is not just idly standing by.”

Korea Fintech Week celebrates is its third year. Unlike last year, the event was held both off and online. Last year the exhibition was held digitally due to rising number of Covid-19 cases.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]