“There are a lot of people who look at these two cases meaningfully: Coupang, which officially officially listed the NASDAQ, and HyperConnect, which was sold for 2 trillion won. Coupang’s services are limited to Korea, but financing is realized in the parent company, the US, and is running to listing. On the contrary, HyperConnect is managed in Korea, but management results have been achieved overseas. You need to turn your eyes to the world. If we pursue overseas cooperation, more Korean fintech companies that become unicorn companies will appear.”
Attorney Junhee Lee (47, 29th Judicial Research and Training Institute), who is in charge of the fintech team at Yulchon Law Firm, told the future of domestic fintech (finance + technology) companies in an interview with the Segye Ilbo at Parna Tower, Gangnam-gu, Seoul. I answered the question like this.
Lee is currently evaluated as the lawyer with the best understanding of fintech in Korea. At Kim & Jang, his first company, he was in charge of financial regulation as a member of the financial team, and in 2011, he began to enter the field of e-financial transactions and fintech in earnest when he corrected the information leak of Hyundai Capital. Afterwards, he led the fintech team at Yulchon, a law firm, after joining Hyundai Card and Coupang.
“One of the fun things about this market is that information technology (IT) people meet with finance people. Finance is relatively popular now, but anyway, it is a regulated industry, so the wall is high. At that point, I thought I had a lot of work to do as a lawyer.”
Lee said that domestic financial regulations are relatively tighter than that of foreign countries, but he appreciated the government’s commitment to financial innovation. The intention is that the threshold for the financial industry is lowering as the government actively promotes open banking and my data industries. However, for the existing regulations, I thought it was necessary to look into the effectiveness of each regulation. Regulations created in the past can be an obstacle to innovation today. On this day, the interview with Lee attorney was solved in a Q&A format.
ㅡ I got used to the word’fintech’. Some companies do well like Toss, but many do not. What are the typical grievances faced by representatives of fintech companies?
“I can’t say that it’s right or wrong, but the representatives seem to have a lot of dissatisfaction with the financial authorities. Financial regulation is becoming too tight and difficult. It is true that the domestic financial regulation is tight, but it cannot be helped because it is due to the nature of finance. However, it seems that the government’s role in monitoring and adjusting the purpose and expected effects at the time each regulation was introduced is still less than market expectations. I think there is a need to recheck each regulation.”
ㅡIf you evaluate the government’s commitment to innovative finance.
“I have heard a lot of stories from people in the field that the attitude of the government has changed forward. In particular, in keeping with the market trend in recent years, the authorities are moving very quickly and coming up with a number of measures, which was difficult to see before. There may be a temperature difference felt in the market, but I think the government is working hard. Open banking and my data are representative.”
ㅡ When open banking and my data are activated, the importance of information protection is more emphasized.
“As we have experienced various incidents, (the government) has tended to solve it with the law. The law is revised to strengthen financial regulations and criminal penalties. Increasing criminal punishment can have many side effects. It is not just to strengthen criminal responsibility. The second amendment to the Personal Information Protection Act, which received recent opinions, included financial penalties such as fines instead of criminal penalties. Companies basically think that giving customers trust by managing information is the foundation of management. It should be recognized that business, consumer trust, and information protection are values that go together organically. When these are harmoniously synergistic, consumer information can be well protected.”
ㅡ There is a lot of recognition that’fintech companies are less safe.’
“Fintech has changed what existing financial companies such as banks and securities have to be consumer-friendly. The user environment (UI) and user experience (UX) are improved to be familiar to consumers. In terms of the basics, there is no significant difference with existing financial companies. There is a perception that’fintech is inferior in safety’, but fintech companies also pay a lot of attention to safety. However, how to protect safety and security while introducing a user-friendly UX is a challenge that the fintech industry will continue to think about.”
ㅡIf you look at safety in terms of financial companies.
“In terms of safety, the most important thing is not to prevent accidents, but how to minimize them when an accident occurs, and to systematize what compensation will be given after the incident. Stability issues should be approached in terms of risk management, such as upgrading the abnormal transaction detection system (FDS). Of course, fintech companies are approaching from this point of view.”
ㅡ What is the future of Korean fintech companies?
“If you don’t just look at the Korean market, but look at and practice linkages with overseas such as financing from abroad, more Korean fintech companies that become unicorn companies will appear. Financial industry is relatively difficult compared to other industries as regulations vary by country, but it is not impossible to see that Line has succeeded in Japan, Thailand, and Taiwan. I think there will be continued attempts (by fintech companies) for growth, and success will be possible.
ㅡFinally, are there any goals in Yulchon?
“As the market develops, companies also want advice from a professional perspective, rather than a single-line approach like’don’t do this because it’s a legal issue.’ We want to provide some kind of market insight. To do this, genuine expertise, experience, database and know-how must create synergy. The primary goal is to cultivate a specialized fintech team in the market by implementing these features. In the end, I want to lead new and changing market trends by expanding the area to other information technology (IT) and platform businesses.”
Reporter Heejin Lee [email protected]
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