|Shinhan Financial Group Chairman Cho Yong-byoung|
The group is currently establishing a consortium, which will invite other potential financial and strategic investors for the envisioned bank. Viva, a startup that launched Toss, a peer-to-peer mobile payments platform, will be one of Shinhan Financial's partners.
Shinhan added it will soon apply for an internet banking license to the Financial Services Commission (FSC).
This is part of the group's efforts to digitally transform its business.
"We will pursue digital transformation and innovation with our partners and introduce a creative internet banking service that has never been seen before in the market," Shinhan Financial said in a press statement.
The group said it will discuss the equity structure of its internet bank with its partners.
Industry sources say Shinhan Financial is likely to be the biggest shareholder, given its position as it will soon overtake KB Financial as the leading financial group.
"The question is how it is going to make the internet bank stand out in the crowd of mobile banking platforms that offer similar services," said an industry source.
FSC Chairman Choi Jong-ku said his organization will begin accepting applications from the private sector seeking to set up internet banks next month.
It will speed up the process by granting licenses to applicants by the end of May.
This comes after a revised law took effect in January, enabling nonfinancial technology companies to exercise voting rights of up to 34 percent in internet banks, up from 4 percent.
Naver and NHN Entertainment, which were considered runners up to become the third internet bank here, recently said they were not interested.