Coming up now, we introduce Korean companies that contribute to bringing about changes in the global economy with some groundbreaking ideas. The company we’re going to talk about today is Finotek, a leader in the Korean fintech industry. Let’s meet with Lee Hyun-mo, vice president of the company.
Finotek started business in November 2008. Since then, the company has focused on technology and services that will be necessary in financial institutions without branches. We have developed a full range of technical platforms for more efficient financial services, from a real-time online mortgage loan solution to non face-to-face real-name verification. We have further expanded the scope of our services to operate an AI-based chatbot capable of communicating with and advising customers. When we started our business, we weren’t actually aware of the concept of fintech, which appeared in Korea around 2014 or 2015. But we estimated how financial institutions and services would evolve, and developed technology tailored to the expected change. For instance, a number of Internet banks have cropped up these days, and we provide necessary services to those banks without branches.
Fintech refers to the convergence of finance and technology, or applications of digital technology for financial services. The range of fintech is expanding from online payments and easy money transfers to non face-to-face transactions and Internet banks. Finotek prepared for the new era of finance even before the wind of fintech blew in to Korea. As a company representing innovative technology, it attracted much attention at the “Korea Service Market,” a business-to-business consultation meeting which introduced various services related to education, medicine, new technologies and content convergence in Korea. Mr. Lee explains the company’s convenient customer identification technology.
For customer identification, we provide Optical Character Recognition or OCR technology, which captures the image of a presented identification card and recognizes the data. Video calls are another method of identifying customers. We offer the electronic document management technology, which is essential to deal with various banking services. Our electronic registration platform is also very useful for the mortgage loan service, which requires customers to go through administrative procedures like visiting the registry office. Our e-signature verification service uses a customer’s personal handwritten signature that the customer previously wrote on his or her mobile phone, while our context-based authentication solution confirms a particular customer based on the service record kept in their mobile phone.
The company has been carrying out its fintech business based on key technologies, including video calls and e-signature verification. These technologies are essential for Internet banks since they enable customers to open their bank accounts without having to physically visit bank branches. When applying for real-estate mortgage loans, people usually have to get registration-related documents issued before visiting a bank. The process takes two to three days. To ease the inconvenience, Finotek developed a one-stop platform that automates all the loan application procedures online and completes the process in just 30 minutes without requiring customers to visit a bank. This convenient service received the Best Mobile Mortgage Solution award at the Citi Mobile Challenge, which is a world-famous competition of cutting-edge fintech solutions, in Hong Kong in 2015. It is little wonder that numerous financial institutions in Korea have introduced Finotek’s outstanding services.
A majority of Korean banks, including Shinhan Bank, Woori Bank, KB Kookmin Bank and NH Nonghyup Bank, are using our non face-to-face mortgage loan platform. These days, peer-to-peer or P2P lenders are also using it. Up to 80 percent of Korean financial firms rely on our fintech solutions. We have provided our non face-to-face real-name verification platform to most banks in local provinces, including Gwangju Bank, Daegu Bank and Busan Bank. These banks are located in particular regions and have few branches in other provinces, but I imagine they still can expand their services through this platform.
Finotek’s technology goes beyond Korea and is used overseas as well. It signed a memorandum of understanding with German WebID Solutions(GmbH) on fintech cooperation in 2016. In the same year, the company advanced into the U.S. market. Finotek entered into a contract with Trulioo, a provider of identity verification services, and has provided its technology to Amazon and eBay so consumers in South Korea and Southeast Asia who use those e-commerce giants can complete their identification verification process conveniently. The company has developed the “robot counseling” service as of late to spur the market expansion.
Banks without branches need more call centers. Customers used to ask bank tellers questions when applying for some financial services or filling out forms, but now, call center staff perform the same function over the phone. That’s rather inconvenient for customers. Of course, our service cannot replace call centers entirely. But we figured out that 60 to 80 percent of customers’ questions are the same. If robots handle the routine questions, call center workers can provide better advice and the robots can provide information to customers even after office hours. Focusing on this advantage, we developed an AI-based robot service.
The company unveiled its robot counseling service in 2016. The AI-based solution automatically answers customers’ questions about financial transactions. Finotek boasts the technology of analyzing a massive amount of data, using the chat robot equipped with artificial intelligence. The accumulated counseling data is used to provide services tailored to individual customers. The robot counseling service allows customers to get counseling 24 hours a day, 365 days a year, through their smartphones or computers. Banks, on their part, can reduce operation costs. It comes as no surprise that the domestic fintech market is actively introducing robot information services. Obviously, Finotek’s advanced technology is bringing a change to the financial sector. The company is now dreaming of another significant change.