Global FinTech Guide
Country Name
Korea, Republic of
RegTech and compliance management
RegTech is composed of the words “regulatory” and “technology”. It is a collective term for the application of modern technologies, to get the increasing regulation in the banking- and financial sector under control both from an IT and a legal standpoint.


Attitude of the country towards RegTech-services

Authorities are emphasizing the need to implement RegTech in order to respond more efficiently and effectively to financial regulations at a time when financial data are increasing exponentially and financial services are becoming more intelligent and advanced due to technological development.

Financial authorities performed the 'Machine Readable Regulation' (MRR) pilot project on or around September 2018 as a detailed implementation plan for vitalizing RegTech and launched the RegTech development council on or around October 2018. The Financial Security Institute has reorganized the Financial Security RegTech Portal ( since June 2020 to help financial companies comply with relevant regulations related to financial security.

Legal affairs  

Obligations and requirements to provide RegTech-services

There is no regulation that directly governs RegTech, and relevant laws such as Specified Financial Information Act and the EFTA do not require special qualifications or costs for providing RegTech services.

Additional comments regarding the legal situation for RegTech-services or what RegTech’s must be aware of in this business area

Under the FISCMA, as duties in relation to internal control and compliance monitoring of a financial investment company may be outsourced to a third party as long as the decision making authority is not outsourced (Article 42(1) of the FISCMA and Article 45 of the Enforcement Decree of FISCMA), there are no restrictions as to the use of RegTech services when investor protection and sound trading practices are not likely to be undermined. However, if duties in relation to internal control are outsourced, the trustee shall have no decision making authority. Thus, RegTech services can be used for internal control and compliance monitoring, but decision making in relation to duties shall not be vested in the trustee and must be carried out directly by the financial company.

Economic conditions

Market size for RegTech-services and biggest companies in this business area

The current size of the domestic RegTech market is not available, but the Korea Capital Market Institute anticipates that the size of RegTech market will continue to expand. For reference, the global RegTech market is expected to continue growing (value-wise) at the rate of 19.5 per cent annually, from $5.32 billion in 2019 to $21.73 billion in 2027.

There seems to be no real RegTech company in Korea, as companies are merely utilizing the RegTech services. Compliance solution companies or financial companies are trying to implement RegTech services.

Additional comments regarding the economic situation for RegTech-services or what RegTech’s must be aware of in this business area

In the capital market, the RegTech market seems to appeal differently depending on large, medium, and small companies. While large companies are able to invest in basic compliance functions, small and medium-sized companies often do not. Therefore, large companies tend to put the security of work information in the first priority, while small companies tend to prioritize cost minimization.

There is a demand for RegTech in a cost reduction aspect but considering compliance monitoring personnel and investment behavior for compliance monitoring systems, it may be difficult for RegTech services focusing on small and medium-sized companies to immediately generate profits.



© 2022, Lee & Ko. All rights reserved by Lee & Ko as author and the owner of the copyright in this chapter. Lee & Ko has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this guide.

The information in this guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.


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