[Digital Today reporter Ji-young Lee] The fintech industry is expanding the reach of payment infrastructure while strengthening security and user protection systems.

The Financial Supervisory Service and the Korea Fintech Industry Association launched an "online fraudulent payment response consultative body" with major payment gateway firms. They aim to reduce suspicious transactions that pass through successive monitoring nets of financial companies and PG firms.

The body will focus on subdivisions for fraud detection systems (FDS) and anti-money laundering (AML). It will share accident cases and detection experience, and plans to draw up "standard practical guidelines for preventing and responding to fraudulent payments" in the second half of the year.

On payment convenience, Kookon linked about 50 global simple payment services, including UnionPay, WeChat Pay and QRIS, to Toss Place terminals. Merchants can now accept mobile payments from foreign visitors using their existing Toss Place terminals without separate contracts or additional terminals.

CrossENF completed registration with the Financial Services Commission as an issuer and manager of prepaid electronic payment instruments, securing status as an electronic financial business operator. It plans to add top-up and payment functions to its existing overseas remittance service "Cross" and online commerce platform "Cross Shop" to provide remittance, consumption and payment in a single app.

Fintech payment competition is moving beyond simple expansion of convenience to blocking fraudulent payments, complying with regulations and securing a foreign customer base.

• Block suspicious transactions missed by financial firms' FDS... PG industry moves to joint response to fraudulent payments • Kookon links global payments to Toss Place terminals • CrossENF registers as issuer and manager of prepaid electronic payment instruments

The Bank of Korea raised its policy rate to 2.75 percent from 2.50 percent, shifting the direction of monetary policy from easing to tightening. It was the first rate hike in 3.5 years.

With the economic recovery proving stronger than expected, the decision also took into account inflationary pressure and financial stability risks such as household debt, housing prices and the exchange rate. It also left the possibility of additional hikes open.

In line with the policy-rate increase, management of household lending by financial authorities and banks is also tightening further.

As banks' household loans grew, major banks raised the bar for lending by lowering mortgage limits and suspending loan broker applications and the handling of mortgage insurance.

Financial authorities are also expanding the management scope to regional banks and are checking the total amount of household lending and the pace of increases in the second half of the year.

Amid tighter lending rules, a proposal also emerged to support jeonse loans mainly for vulnerable groups while imposing separate burdens on high-value loans, combining protection for end-users with management of household debt.

• Tightening shift as growth revives... BOK leaves room for additional rate hikes • BOK raises rates for first time in 3.5 years... policy rate at 2.75 percent • "Support jeonse loans mainly for vulnerable groups... impose levies on high-value loans" • Tighten household lending further... lower limits and strengthen management

As criticism continues that single-stock leveraged ETFs have increased volatility in the domestic stock market, the government and the securities industry also decided to raise the bar for investing.

The government decided to raise the basic deposit for single-stock leveraged ETFs tied to Samsung Electronics and SK Hynix to 30 million won from 10 million won from next month on Aug. 5.

The securities industry also moved to take voluntary investor protection measures, such as expanding risk warnings that reflect investors' age and portfolios and raising the basic deposit.

It also plans to expand the trading unit to 20 units from 1 unit to reduce small-amount short-term trading. It will check trading trends and the impact on volatility of the underlying stocks after the system takes effect.

• Single-stock leverage blamed for sharp swings... triple deposit to raise trading bar • President Lee says, "Quickly draw up measures to supplement single-stock leveraged ETFs" • Securities industry pushes to raise deposits for single-stock leveraged ETFs

In the financial sector, discussions simultaneously came to the fore on expanding non-bank profits, digital transformation, governance restructuring and restructuring regional finance.

With stock market turnover increasing, brokerage revenue at securities affiliates has grown, boosting financial holding companies' non-interest income and contributions to results.

Tasks for the second half include expanding the customer base, restoring banks' earnings power, strengthening non-bank competitiveness and spreading AX. It also declared improvements in soundness, upgrades to non-face-to-face systems and expanded cooperation with external platforms.

Financial authorities said in a business report they would push to improve procedures for renewing financial company CEOs' terms and expand the National Growth Fund to 20 trillion won. Amid this, Align publicly proposed a feasibility review of a merger between JB Financial Group and BNK Financial Group to strengthen competitiveness of regional finance.

• Securities firms become main contributors for financial groups... results driven by brokerage boom • Woori Financial speeds up push to become a comprehensive financial group... boosts execution on customers, earnings and AX • iM Bank checks management strategy for second half... expands cooperation with external platforms • Revise procedures for renewing financial company CEOs' terms... expand National Growth Fund to 20 trillion won • Align publicly proposes review of merger between JB Financial Group and BNK Financial Group

Competition in the financial sector's AI transformation (AX) is moving beyond the declaration stage to an execution phase centered on applying it to front-line work, organizational restructuring and talent development.

KB Financial launched "KB AI Lab" to implement front-line tasks as AI services, and iM Financial strengthened training for outside directors on major financial issues such as AI and stablecoins.

BNK Financial established an organization to respond to AX and digital assets, and IBK Industrial Bank of Korea is also building an AX strategy group and an AI control tower to combine regional industry and policy finance with digital innovation.

• From declaration to execution... four major financial groups flesh out "AX strategies" • KB Financial launches "KB AI Lab"... fosters work-focused AI talent • iM Financial trains outside directors across affiliates... intensive education on AI and stablecoins • BNK Financial restructures with focus on Busan-Ulsan-Gyeongnam... strengthens industrial finance and AX • IBK Industrial Bank of Korea to restructure in second half... strengthens policy finance and AX

Banks and fintech firms are also strengthening cross-border payment convenience and competitiveness in next-generation payment infrastructure through measures such as fee waivers for overseas remittances, real-time tracking, linking global simple payments and cooperation on agentic AI.

• Toss Bank extends overseas remittance fee waiver until year-end • Hana Bank launches "Fast-Fit remittance service"... provides real-time tracking • Kookon links global payments to Toss Place terminals • NHN KCP joins AAIF, a global agentic AI cooperation body

Other major moves in the financial and fintech industries were also compiled.

KB Financial formed a 100 billion won "KB AX Digital Asset Fund", and KB Kookmin Bank was selected for a third consecutive term as Seoul Metro's main banking partner. Shinhan Bank opened "Shinhan SOL Cluster" in the Jeonnam and Gwangju areas and expanded financial support for strategic industries and local companies.

• KB Financial sets up 100 billion won "KB AX Digital Asset Fund" • KB Kookmin Bank selected as Seoul Metro's main bank for third consecutive term • Shinhan Bank opens "Shinhan SOL Cluster" in Jeonnam and Gwangju... financial support for strategic industries

Woori Bank was reselected as the National Pension Service's foreign-currency custodian bank and will handle related work for the next 3 years. Hana Bank launched a "Hana Manbogi Savings" product with Toss offering up to 4.5 percent annual interest. IBK Industrial Bank of Korea released a group account service that supports sharing transaction details and managing membership fees.

• Woori Bank reselected as NPS foreign-currency custodian bank... to perform duties for 3 years • Hana Bank launches "Hana Manbogi Savings" with Toss... up to 4.5 percent a year • IBK Industrial Bank of Korea joins group account competition... share transactions and manage dues at once

KakaoBank launched a "calculator" service allowing sole proprietors to check in advance real estate secured loan limits and interest rates. K Bank conducted a "movie theater etiquette campaign" with CGV to establish order in moviegoing.

• KakaoBank launches real estate secured loan "calculator" for sole proprietors • K Bank runs "movie theater etiquette campaign" with CGV

As the financial and fintech industries move to advance alternative credit evaluation using MyData and non-financial information, the government is also broadening the institutional foundation for data-based finance by starting demonstrations of data relay infrastructure in employment and education.

• Kakao Pay participates in developing an alternative credit evaluation model for NH NongHyup Bank • BankSalad and Sogang University research MyData-based alternative credit evaluation • Personal Information Protection Commission starts demonstration of employment and education "MyData" relay infrastructure

As linked investments between online lending businesses and savings banks surpassed 500 billion won and funding supply expanded for mid- and low-credit borrowers, authorities moved to manage soundness by limiting new stock loan origination amounts amid a surge.

• Authorities move to rein in surge in stock loans at online lending businesses... cap new origination at 30 percent • Online lending businesses and savings banks surpass 500 billion won in linked investments... expand loans to mid- and low-credit borrowers