|Viva Republica's headquarters in southern Seoul / Korea Times file|
By Kim Bo-eun
Attention is growing on who will join the bidding to open the country's third internet-only bank, with the application period beginning today.
The Financial Services Commission will accept applications until Oct. 15.
Potential contenders have tried to keep a low profile ahead of their applications.
According to media reports, Viva Republica, the operator of the financial platform Toss, has partnered with Standard Chartered (SC) Bank Korea to re-enter the race. But both parties denied the reports.
In May, the financial authority rejected a proposal by Viva Republica, stating it needed to increase its own capital base. This was based on the fact that over 90 percent of its capital could be categorized as debt, as the company would have to return funds to investors at a given time.
Partnering with SC Bank could resolve Viva Republica's issues surrounding capital.
|Kiwoom Securities headquarters on Yeouido, Seoul / Korea Times file|
Meanwhile, it is unclear whether the consortium led by Kiwoom Securities will re-enter the race.
Kiwoom's internet banking proposal was also rejected earlier this year, with the FSC citing it "lacked innovation."
Reports have stated KEB Hana Bank, which was part of the Kiwoom-led consortium, will pull out.
There are speculations that if Hana gives up, Shinhan Financial may take its place. Shinhan was part of Viva Republica's consortium earlier this year, but pulled out last minute.
Based on the applications, the FSC will select entities for preliminary approval in December.
The government has pledged to assist in the growth of the fintech industry here. But interest in setting up an internet-only bank has been low.
Viva Republica and Kiwoom were the only two major contenders that applied earlier. The government has gone as far as calling the applicants in to provide consultations on the weaknesses in their proposals.
"Interest in consulting services has not been overwhelming, but we have had applicants," FSC Chairman Eun Sung-soo said at the National Assembly on Oct. 4.
Currently, there are only two internet-only banks, Kakao Bank and K bank. The former managed to post a net profit in the first half of the year, while the latter has halted loans due to a lack of capital.