Following this announcement, the Financial Services Commission issued a preliminary notice of rules change in regards to the supervisory regulation on credit information businesses that took place on the 7th of December. This happened for the organisation to continue to seek optimisation in financial MyData services and solutions. The revision proposal was prepared after having taskforce meetings and discussions with the MyData service providers and data specialising institutions.
In order to ensure a sustainable operating environment for MyData services, the revision proposal is set to establish reasonable standards for pricing data transfer costs and fees. Since the onset of MyData solutions in January 2022, the service providers have been receiving and gathering information transferred from multiple data suppliers, such as telecommunications tool providers, payment gateways, and financial institutions.
In addition, this revision proposal supplies reasonable grounds for pricing the cost of transferring information for MyData providers. Furthermore, a standard cost approach is expected to be calculated based on the costs required to set up and operate a relevant and secure data transfer system. On a need-to-need basis, a count discount can be offered for the possibility of being delivered to MyData service providers, all based on individual business circumstances.
In order to ensure fairness and transparency, specific procedures for pricing data transfer costs are set to be determined by Korea Credit Information Services (KCIS), which is expected to set up a consultative body including multiple stakeholders. The pricing standards will be applied from 2023, while the payable installments are expected to be applied from 2024. The Korea Financial Telecommunications & Clearing Institute (KFTC) will incorporate an integrated payment system for data providing entities and MyData solution suppliers.
The revision proposal is set to allow data specialising institutions to offer consulting services in the areas of data coverage and pseudoymisation, especially to small and medium-sized enterprises and fintech businesses (SMEs, SMBs), which lack professional capacity in this field most of the time. At the moment, there are twelve data specialising institutions in the market and they deliver verification services on the appropriateness of data convergence which is carried out by financial institutions. In addition, the revision proposal will also eliminate the need to have different requirements under two separate laws (including the Credit Information Use and Protection Act and the Personal Information Protection Act) at the moment of applying for data coverage.
In the case of data specialising institutions that need to be designed as such, the qualification process of their executive officers will need to be verified. National and regional government organisations and institutions are exempted from this requirement of being designated as a data specialising firm. Under these revised rules, this exemption is set to apply to public organisations that fall under the oversight and jurisdiction of relevant government ministries, as well as have their own internal control mechanisms.
The revision proposal is expected to be put up for public comment starting from the 7th of December 2023 to the 19th of December 2023. The FSC will work in order to ensure that the changed rules take effect from this year.
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