South Korea delays launch of full data service
The government-led MyData project, once launched, will enable licensed service providers to collect and analyze personal data scattered across the financial industry. Service providers must obtain consent from consumers before they can access their data, which is currently held separately by different financial institutions such as banks and credit card issuers.
The Financial Services Policy Commission has recognized the need to further examine and test the adoption of the application programming interface, or API, software that allows service providers to easily collect data by connecting existing servers. He cited the lack of computer engineers for the project, as the demand for engineers has increased with local businesses focused on developing online and mobile services, due to the pandemic.
The FSC had previously asked service providers to compulsorily replace their current data recovery system with API.
In addition to the technical issues, authorities said they need to perform additional pilot tests to see if the API system can handle the network and associated data traffic for customer protection.
An FSC official said e-commerce platforms and small businesses are “not quite ready” to adopt the API, and authorities’ goal for now is to launch the MyData service. by the end of the year.
FSC will also consider whether to include real name bank receipts that show customer wiring history and data. The commercial banks here, however, were against the idea, as it could lead to personal data leaks. The FSC explained that they would have to get the client’s consent first.
In addition, customers could subscribe to several MyData services, but would receive data protection warnings in advance.
Service providers will be prohibited from excessive marketing, as this could fuel “unnecessary competition”.
The decision to further review MyData services came after a meeting of FSC officials, experts and financial industry executives on Wednesday.
The license for the MyData service has so far been granted to 28 local financial institutions and financial technology companies. The five traditional lenders that have been licensed are KB Kookmin, NH NongHyup, Shinhan, Woori and Standard Chartered Korea. A total of 14 fintech companies, including Naver Financial and the popular operator of the money transfer app Toss Viva Republica, have received the license.
By Jung Min-kyung ([email protected])