To ease the burden on small business owners, the scope and items for disclosure of payment fees in the electronic financial business will be expanded in phases. The regulatory framework for payment gateway (PG) services will also be strengthened.
On the 30th, the Financial Services Commission announced plans to overhaul the disclosure system for payment fees in the electronic financial business and to strengthen the regulatory framework for PG services.
The Financial Services Commission will expand disclosures to lower payment fees through market competition. Currently, only 11 firms with an average monthly simple payment transaction volume of 100 billion won or more are covered, but next year, firms with an average monthly payment volume of 500 billion won or more will be added to the disclosure list. In 2027, the threshold will expand to firms with an average monthly payment volume of 200 billion won or more, and in 2028, the scope will be phased in to include all prepaid issuers and PG providers.
At present, only the total fee is disclosed by payment method for cards and prepaid, but going forward, disclosures will separate externally collected fees, such as those paid to card companies and upper-tier PG providers, from fees collected by the prepaid issuer or PG provider itself. Electronic financial businesses will classify and disclose by type according to business structure and concurrent operations to make it easier to compare fees among firms with similar business models.
Regulations will also be tightened. As multi-level PG structures spread—where a PG provider contracts with lower-tier PG providers to outsource merchant acquisition and management—problems have arisen such as duplicate fee burdens and facilitation of illegal transaction activities, but the current legal framework has limitations.
Accordingly, prepaid issuers and upper-tier PG providers will be required to assess financial soundness and risks of illegal conduct when entering into or renewing contracts with PG providers. For lower-tier PG providers with high risk levels, measures such as not entering or renewing contracts, mid-term termination, and corrective demands will be mandated.
Electronic financial businesses will also be required to clearly distinguish and notify merchants of "payment fees," and this rule will expressly apply even when contracts are concluded through sales agents. It will also be clarified that merchants must be notified in advance when changing payment fees, in addition to the initial merchant contract.
The Financial Services Commission will promptly revise the payment fee disclosure guidelines for electronic financial businesses and implement ad hoc disclosures in November. Conduct regulations for PG services will be introduced through administrative guidance in November, and the electronic finance supervisory regulations will be amended by the first half of next year.