The addition of internet-only banks in the South Korean banking space should raise the level of price competitiveness and lead to the development of new services for clients, said Jeong Eun-bo, vice chairman of the Financial Services Commission.
Jeong expects that internet-only banks will be able to conduct credit assessments based on data to identify low- to middle-income people that borrow money from nonbank lenders, Yonhap News Agency reported Jan. 23.
Customers should see higher interest rates on deposits and lower fees on payment services, which would be possible as these banks do not have to operate bank branches.
Kakao Bank and K-Bank are in the process of being set up as the first internet-only banks in South Korea.
The former is awaiting final approval from the FSC, while K-Bank has already done so.