South Korea will allow new domestic players to enter its banking industry for the first time in 30 years, a move meant to boost competition in a sector dominated by five major lenders.
The country’s financial regulator will allow financial firms to apply for nationwide commercial bank licenses, the Financial Services Commission said in a statement on Wednesday, the first time it’s doing so since 1992. The move is seen paving the way for competition that could help lower interest rate costs for consumers.
Lenders made record profits during the Covid pandemic and “paid their interest income as bonuses and dividends for employees and shareholders rather than returning it to citizens,” the FSC said in the statement.
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