G20 Roadmap for Enhancing Cross Border Payments: South Korea (Wise)

Summary

• Major South Korean banks demonstrate foreign exchange markups that are typically less than 1% over mid-market rates.p.16
• The Financial Services Commission supports non-bank providers through a KRW500 billion Fintech Innovation Fund (2024–2027) that reduces API transaction fees.p.15
• The Korean Federation of Banks provides public comparative fee and rate information across 17 commercial banks in South Korea.p.16
• South Korea is one of eight G20 members to achieve a full 5/5 rating for direct access in 2025.p.10

Key insights

1. South Korea's top direct access rating is driven by the open banking platform operated by the Korea Financial Telecommunications and Clearings Institute (KFTC).p.15
2. Direct access in South Korea allows non-bank payment service providers to connect through KFTC infrastructure, initiating payments with final settlement executed via bank accounts at the Bank of Korea.p.15
3. Price transparency progress remains constrained because South Korea lacks regulatory requirements mandating the explicit disclosure of foreign exchange markups as a distinct cost.p.14
4. In 2024, KFTC introduced a cross-border QR payment system directly linking domestic non-banks and banks to overseas payment networks.p.15
5. While the Financial Consumer Protection Act (2021) outlines general principles for fair treatment, its application to foreign exchange transparency remains limited.p.16
6. Foreign exchange markups among South Korean providers are consistently concealed within exchange rate margins rather than itemised separately.p.16
7. Future South Korean payment policy aims to incorporate emerging technologies such as artificial intelligence and 6G networks into open banking under the K-Network 2030 strategy.p.15