Electronic Financial Business

The Electronic Financial Transactions Act is the core statute that sets out the overall legal framework, including the definition of electronic financial business, licensing and authorization requirements, user protection, and the structure of liability.

It serves as the benchmark for determining an operator's status and duties and the scope of liability when an incident occurs.

The Regulation on Supervision of Electronic Financial Activities is a subordinate regulation that gives concrete shape to the Electronic Financial Transactions Act, specifying the detailed standards needed for day-to-day operations, including IT infrastructure, information protection, internal control, and capital requirements.

It is an area closely tied to regulatory examinations and sanctions, and it calls for ongoing compliance management.

※ Future amendments may tighten the capital requirements for some categories (for example, PG), so ongoing monitoring is needed.

※ Relaxed standards apply to small-scale operators whose quarterly electronic financial transaction amount is 3 billion won or less.

The entry of IT-based companies into the financial industry is accelerating.

As big tech firms such as Naver, Kakao, and Toss lead the way with innovative services, both competition and cooperation with established financial companies are deepening at the same time.

As a result, the structure of the electronic financial business market is also being reshaped quickly.

As cloud technology is adopted across financial infrastructure, the efficiency of service development and operation is improving considerably.

Faster service launches and cost savings have become possible, and the use of the cloud is expanding on the premise of sound security and regulatory compliance frameworks.

New businesses centered on the use of data are expanding rapidly.

A variety of tailored financial services are being launched on the basis of open banking and MyData, and data competitiveness is becoming a core business capability.

Change is also continuing on the institutional side.

The regulatory sandbox has made it easier to test and commercialize new services.

Traditional financial companies are also actively pursuing digital transformation strategies.

Across the financial industry, ESG management has emerged as a leading issue.

A range of initiatives is underway, including eco-friendly financial products, investment grounded in social value, and sustainability management reporting, and fintech companies are likewise expanding services that reflect ESG factors.

As AI and big data technologies advance, financial services are growing more sophisticated at a rapid pace.

Data-driven services are spreading across the areas below, raising the level of both customer experience and risk management.

A misalignment between the business model and licensing requirements, such as capital, personnel, and IT and security systems, operates as a primary risk.

From the service planning stage, a company should review in advance whether it falls within the relevant business category and whether it can meet the applicable requirements.

Procedures are frequently delayed because applicants fail to prepare enough of the materials required during the licensing application process.

It is important to review the scope and standards of the required documents in advance and to allow sufficient time for preparation.

IT infrastructure and information protection systems, such as network separation, DR center construction, and ISMS certification, require considerable lead time.

If these are not built proactively in parallel with the licensing process, the overall project schedule may be affected.