The South Korea Financial Services Commission has proposed bringing online deposit brokerage into the formal regulatory framework as a registered business under the Financial Consumer Protection Act. The changes would institutionalize services piloted under the financial regulatory sandbox since November 2022, including online deposit comparison and recommendation, links between prepaid balances and bank deposits, and brokerage of settlement accounts for e-commerce sellers. Online brokers would be permitted to compare products from multiple financial companies but must cover at least three providers. They would face a KRW 30,000 cap on gifts, cashback and other special benefits per contract, while each platform’s brokerage volume for an individual financial company would be capped at 1% of that company’s new deposits and installment savings in the previous year. Brokers could not offer products from firms subject to prompt corrective action. Algorithms would require verification at least annually against standards designed to prevent fees and conflicts of interest from distorting product rankings, with the number of eligible verification bodies expanding from one to three. Certain comparison, algorithm review and benefit restrictions would also apply to loan product brokers, while a ban on advertising that could obscure the identity of the financial company providing the product would be extended from insurance products to all financial products. The amendments would take effect three months after their promulgation. Businesses operating under the regulatory sandbox when the rules take effect could continue without registration for six months while applying for authorization.

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