Lee Jae-myung of the Democratic Party of Korea and Kim Moon-soo of the People Power Party both pledged to establish a specialized internet bank for ordinary citizens and small business owners, which is expected to influence the selection of the operator for the 4th internet bank.
The previous three internet banks are generating revenue from household loans such as mortgage loans and credit loans, making it difficult to ensure profitability as a specialized bank for ordinary citizens and small business owners. There are also indications that changes may occur within the consortium that has applied for preliminary approval.
According to financial and political sources on the 16th, both candidates promised to promote a specialized internet bank for vulnerable groups as a core financial pledge.
Specifically, Candidate Lee pledged to promote a specialized internet bank for mid-interest loans aimed at vulnerable groups such as ordinary citizens and small business owners. Candidate Kim also stated that he would establish a bank specialized for ordinary citizens and small business owners. In a broader context, the internet bank pledges from both candidates align. They deemed that the existing financial sector has limitations in handling loans for ordinary citizens and small business owners and promised to establish a new form of internet bank.
Initially, there were predictions in the financial sector that the establishment of internet banks would be delayed due to the launch of the new government. However, due to the pledges from both candidates, it is expected that the selection process by financial authorities will proceed as scheduled.
However, there are observations in the industry that the candidates jointly presented a kind of guideline termed 'a specialized bank for ordinary citizens and small business owners,' which could act as a variable in the operator selection process. Since the preliminary and full permits will be processed by the next government, it is inevitable that the candidates' pledges will affect the operator review.
The financial authorities received applications for preliminary approval for the 4th internet bank last March. They plan to complete practical reviews by June and select the preliminary operator. Currently, four consortiums, including ▲Soso Bank ▲Korea SOHO Bank ▲Podo Bank ▲AMZ Bank, are undergoing preliminary approval reviews.
The consensus in the banking sector is that revenue cannot be generated from mid-interest loans for ordinary citizens and small business owners. The three internet banks, including Kakao, are also achieving results through household loans. Therefore, the consortiums that have applied for preliminary approval are closely watching the policy direction of the next government.
There are also observations suggesting that prominent candidate companies that initially decided to participate in the 4th internet bank anticipated this situation and proactively withdrew their preliminary applications. The DOUZONE consortium, which was regarded as a strong candidate, has withdrawn from participation, and the U-Bank consortium (Hyundai Marine & Fire Insurance) has also postponed its application for approval.
A representative from one consortium noted, "If the focus is solely on ordinary citizens and small business owners, the government's influence will inevitably have a significant impact on management. If new approval criteria emerge under the next government, we will need to reassess the project's viability."