Fintech Association Launches Fintech AI Council, Calls for Regulatory Reform

South Korea's Fintech AI Opens the Door to Accelerated Innovation: Regulatory Improvement and Support are Crucial The Korea Fintech Industry Association launched the 'Fintech AI Council' on the 8th, taking a significant step to respond to the challenges of the global AI financial market and promote domestic fintech AI innovation. Chairman Lee Geun-joo projected the global fintech AI market to grow rapidly from $13.7 billion in 2023 to $123.2 billion in 2032, emphasizing the value of AI in financial innovation such as anti-money laundering (AML), abnormal transaction detection, and asset management automation. However, domestic fintech companies are experiencing significant uncertainty due to the lack of clear regulations regarding AI model verification, data utilization, and security requirements. Chairman Lee stressed that the council must discuss AI adoption policy directions, gather opinions, and build an 'industry environment where innovation and ethics are harmonized.' The industry pointed out network separation issues and the lack of API standard guidelines when introducing AI for innovative financial services, unanimously stating that urgent establishment of financial AI legislation is needed in Korea compared to countries with relaxed regulations such as the US, UK, and Singapore. Furthermore, in line with the government's budget for fostering the AI sector, they requested budget allocation for building fintech financial AI testbed infrastructure, improving work productivity through AI utilization, and developing quantitative investment education. In a seminar held concurrently with the launch ceremony, lawyer Gu Tae-eon (Lin Law Firm) emphasized the importance of a principles-based flexible approach through international case studies. He particularly compared the strict regulations of the European Union (EU) with the Monetary Authority of Singapore's (MAS) FEAT principles-based self-regulation, offering implications for Korea's regulatory direction. Kim Se-ho, an executive director at Samjong KPMG, predicted that global fintech investment would recover centered on B2B solutions, sharing the insight, "Financial institutions are needed to provide financial services, but financial institutions themselves are not necessarily needed." He emphasized the advancement of B2B business models and the establishment of a scale-up foundation for overseas expansion. The Fintech AI Council, which elected Chairman Lee Geun-joo as its inaugural chairman, plans to lead the development of South Korea's fintech AI industry by continuing subsequent activities such as listening to member companies' opinions, improving AI-related systems, and securing government support budgets.