At its core, South Korea is an incredibly tech-savvy nation that remains home to electronics titans such as Samsung and LG.
While the nation’s economy may be established as a consumer electronics behemoth, Korea continues to lag behind many of its rivals when it comes to the overriding financial system. More specifically, the banking sector has been slow to embrace the apparent benefits of fintech.
A keen sense of conservatism (caused by economic crisis’ in 1997 and 2008) has also hindered technological advancement in the region.
However, there may be signs that South Korea may be primed for fintech growth, particularly in sectors such as the forex market. But how will this unfold in the coming years?
1. The Evolution of Fintech in South Korea
In many ways, it’s the sustained evolution of fintech and the convenience provided by its solutions that have helped to overcome the government’s inherent conservatism. This has also helped win over public opinion, particularly in the digital and mobile banking sectors.
This has inspired several sweeping regulatory challenges in South Korea, with the country’s Financial Services Commission (FSC) having identified specific sectors to support in this respect.
Perhaps the most significant innovation has been seen in the payments space, which has seen exponential growth and relatively quick adoption.
Of course, this has been helped by Korea’s inherently high smartphone penetration, which has helped drive mobile payment solutions (such as Venmo), which allow transactions to be processed with a single password and click.
2. The Rise of Fintech Applications and in-app Services
One particular focus in regions like Korea is a forex, where fintech has had a dramatic impact over the last two decades.
Those who regularly access their live account through a smartphone or tablet will testify to this, while there’s no doubt that Asia is becoming increasingly dominant in the forex space.
To this end, three Asian hubs are now featured in the world’s top five foreign exchange centers, with Singapore leading this charge and ranked third behind Britain and the US.
Singapore holds an impressive 7.6% share of the global forex market, while the top five also includes Hong Kong (7.6%) and Japan (4.5%).
Beyond this, Korea may also follow the example set by China and similar Southeast Asia nations by building in additional services and verticals to its core fintech apps and solutions.
For example, Korea’s most widely-used chatting app Kakao has made a conscious effort to expand its reach and verticals to cover mobility, payments, and a raft of financial services.
Ultimately, these steps should stand South Korea in good stead in the future fintech market, as the nation finally starts to build on strong foundations to become a significant player in this fast-growing space.