Input 2021.02.18 19:10 | Revision 2021.02.18 19:54
On the 18th, the Korea Financial Research Institute held a discussion on the amendment to the Electric Fund Act sponsored by the Financial Services Commission and made a claim that “it is desirable to legalize an external liquidation agency for Big Tech.” The panel was attended by Han-jin Lee, head of the Electronic Finance Division of the Financial Services Commission, Lee Soon-ho, a research fellow at the Financial Research Institute, Jeong Seong-gu, a lawyer at Kim & Chang Law Firm, Jung Joong-ho, head of Hana Financial Research Institute, Kim Ji-sik, Naver Financial Director, and Jang Seong-won, deputy general secretary of the Korea Fintech Industry Association.
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This debate was held the day after the BOK criticized the amendment to the Jeongeum Act as the Big Brother Act. It means that the Financial Services Commission indirectly counterattacked the BOK through the debate. The BOK disclosed the results of requesting legal review to two domestic law firms the day before. It can cause controversy over Big Brother,” he criticized. The Financial Services Commission said it would collect transaction information for user protection and transaction transparency, but the BOK is in a position that such information acquisition is excessive.
◇ Han Eun accused the’Big Brother Act’… “The problem of trust in clearing institutions”
The controversy over whether users’ personal information is excessively exposed through external clearing organizations became the main issue of the discussion meeting. In this regard, attorney Jeong Seong-gu said, “It is not a problem of external liquidation itself, but a question of whether the liquidation institution can be trusted.” “Isn’t that doubting the role of the Kumho Kwang-gye-won itself?” He explained, “In the case of the KFTC, we are already processing personal information in relation to the operation of the financial settlement network, and there are special rules for preventing information and misuse of liquidation institutions and strengthening security.”
Researcher Jung Joong-ho also said, “I think it is more important not to think about the existence of an external clearing organization, but whether this organization can perform the clearing function smoothly without violating the principle of personal information protection.”
In particular, Han-jin Lee, manager of the Financial Services Commission, who helped to make the amendment to the Electric Money Act, devoted about 40 minutes to the closing remarks and explained the significance of the amendment to the Electric Money Act. Manager Lee said, “Last year, a fintech company made a fraudulent settlement of 8.9 million won, and as a result, many customers withdrew from this service. I thought, “I couldn’t guarantee the trust as much as the bank.”
“If the government secures the trust of Big Tech through external liquidation obligations, etc., there will be more opportunities for more innovators to show off good technologies that can increase consumer benefits.” “I hope you know that letting go is the message contained in this law.”
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Panels stressed that the legalization of external liquidation agencies is necessary to protect consumers. Research Fellow Lee Soon-ho said, “I think there is a need to protect users from the bankruptcy of the trustee financial company (Big Tech). For this, the external liquidation system will help because the user’s deposit must be managed separately for each user.” Said. He said, “The volume of transactions through Big Tech reaches 10 million per month.”
Attorney Chung said about the concept of external liquidation, “It is a process of clarifying that the internal transaction of an electronic financial business operator is confirmed once through the KFTC” and “it is in the process of connecting with measures to protect the deposits of users.” Attorney Jeong argued that “there is a need for external liquidation in that the risk borne by users in the explosively growing simple payment and simple remittance market must be reduced.”
In fact, in Germany’s leading fintech company’Wire Card’, an accounting corruption incident occurred in June last year, and a total of 1.9 billion euros (2.600 billion won) including user deposits evaporated.
The industry also agreed on the need for an external liquidation system. Kim Ji-sik, director of Naver Financial, said, “It is a burden from the perspective of the business operator.” Seong-won Jang, Secretary General of the Korea Fintech Industry Association, also said, “You must accurately calculate the details of internal transactions so that you can accurately refund in the event of an accident.”
However, Director Kim added, “Please come up with a plan to alleviate the increasing burden on Big Tech, such as minimizing the development cost of using the external liquidation itself and the external liquidation system.”
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