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South Korea approves first online only banks
South Korea's financial regulator has granted preliminary approval for the launch of online-only banks by two groups of investors.
On Monday, the Financial Services Commission gave a cautious go-ahead to telco KT Corp and Alibaba’s Alipay-led consortium of 21 companies that plans to invest KRW250 billion ($215.37 million) in its venture. The second group of 11 companies is led by mobile chat operator Kakao and boasts Tencent and eBay among the partners, and it intends to spend KRW300 billion.
What's striking is the country's welcome embrace of dominant overseas fintech payments operators, in contrast to its continued reluctance to trust its homegrown chaebols to open up banks.
In a bid to spur growth in its banking sector, South Korea is allowing non-financial firms to open banks but it still bars large industrial conglomerates such as Samsung Group and Hyundai Motor Group from taking part, says Reuters.
Photo: Sébastien Bertrand