Woori Bank digital finance storeAhead of the enforcement of the Financial Consumer Protection Act (hereinafter referred to as the Financial Consumer Protection Act) on the 25th, major commercial banks are discontinuing non-face-to-face product sales and AI (artificial intelligence) services one after another.
This is because it takes more time to apply the changed regulations such as the delivery of product description obligations to the computer system and sales process (procedure).
Moreover, the financial authorities added related supervisory regulations and guidelines (business guidelines) later than expected, which aggravated the confusion of the banking sector. In order not to become the’first hitter’ who violated the law, banks are in an atmosphere of suspending services and risking business damage as a result.
According to the financial sector on the 24th, major commercial banks plan to stop selling new products through kiosks (unmanned terminals) at once.
From the 25th to the 30th of the following month, KB Kookmin Bank will not provide a service to create a new deposit and withdrawal passbook in STM (Smart Teller Machine). STM refers to a device that can provide services such as issuing new bankbooks and check cards, and reissuing bankbooks in addition to the general ATM (cash dispenser) function.
According to the Gold Law, when creating a new deposit and withdrawal passbook, the terms and conditions, product description, and contract must be given to the customer, because it is currently impossible for STM to issue dozens of pages of instructions. Therefore, KB Kookmin Bank explained that the service will be temporarily suspended in order to upgrade the e-mail delivery system.
Likewise, Shinhan Bank will stop the new and canceled product service among the services in’Your Smart Lounge (YSL)’, which has the same characteristics as STM. The deadline for suspension is until the system is established in accordance with the law of prohibition, such as issuing product instructions.
Shinhan Bank operates 37 Your Smart Lounges in all branches and stores.
Woori Bank will also stop some kiosk functions, such as deposits and funds through kiosks, and issuance of new credit cards, from the 25th, and then resume sequentially from April. Woori Bank operates about 40 kiosks, and other tasks are performed normally as before.
Hana Bank is also temporarily suspending new and rebalancing (rebalancing) transactions for the AI robo-advisor service’HiRobo’ from the 25th to May 9th. HiRobo is a system in which robots recommend custom funds.
The bank explained that the service was suspended to change the algorithm and fund sign-up process related to the composition of the market portfolio of’HiRobo’ in accordance with the enforcement of the Financial Law.
In some cases, sales of non-face-to-face products have been stopped.
NH Nonghyup Bank will not provide some fund services from the 25th to comply with laws and regulations, such as strengthening the obligation to explain the law in line with the enforcement of the law.
The targets for discontinuation of service are the non-face-to-face subscriptions to collective fund (portfolio) products and pension savings funds. This means that individual fund products can still be subscribed to at the Nonghyup, but collective subscriptions that combine multiple fund products are not allowed. The timing of resumption of sales is undecided.
An official of Nonghyup Bank said, “The computer development has been completed in accordance with the Gold Law, whether it is a collective fund or a pension savings fund account, but it was temporarily suspended for thorough preparation and verification,” he said.
Hana Bank temporarily suspended the deposit and savings subscription service through the AI chat counseling system’Hi Chatbot’ from 5 pm on the same day. This is based on the judgment that it is necessary to maintain the hi-chatbot product subscription process according to the enforcement of the gold law.
The main point of the law enforcement law, which will take effect from the 25th, is the’Six Major Sales Regulations’ (the principle of conformity, the principle of adequacy, the duty to explain, the prohibition of unfair business practices, the prohibition of unfair solicitation, and the prohibition of false exaggerated advertising), which were applied only to some financial products. It is to expand to products.
Among these, financial companies that violate the other four sales regulations excluding the principles of conformity and adequacy are imposed a’punitive penalty’ up to 50% of related income.
An official from a commercial bank said, “There is no specific guideline yet, and the standards for applying the law are ambiguous, which leads to confusion in the field.” Both customers and banks are concerned that the entire business process is bound to become more complex and difficult.”
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