Gov't to boost big data in finance

Financial Services Commission Choi Jong-ku, third from left in the front row, applauds with lawmakers and financial executives at the opening of an event promoting big data in finance at the Korea Federation of Banks, Seoul, Monday. Yonhap

By Park Hyong-ki

The Financial Services Commission (FSC) and the state-run Korea Credit Information Services (KCIS) will open a new database called CreDB as part of steps to boost big data analysis, the regulator said Monday.

They will enable fintech startups and financial companies to gather and sample personal data on as much as 2 million people from the CreDB to analyze and study financial patterns.

Data on bank loans and credit card spending will be open for access.

The companies can then develop their own credit models, which they can further develop later on to integrate with future services. For now, they are forbidden to use the data for target marketing.

"We will push forward to spur big data innovation in finance," FSC Chairman Choi Jong-ku said at an event to promote big data in finance.

"First, we need to earn people's trust in the sector's use and transactions of data."

The KCIS manages financial data of over 40 million people.

The regulator will not allow companies to take the data outside the country. However, it will let them gather bigger samples and integrate them with data from Statistics Korea, the National Tax Service and the National Health Insurance Service.

Also, it will move to provide "virtual data" to universities for research purposes to foster data scientists in the latter half of the year.

Analysts say it was imperative for Korea to create an ecosystem in big data as its competitiveness in the area falls far behind the United States and China.

"Companies will need to form alliances and partnerships in data mining and analysis under a sustainable ecosystem," said Choi Chang-hui, a researcher at the Korea Insurance Research Institute (KIRI).

Without such an ecosystem, the country will not be able to move on to the next step in developing an ecosystem for machine learning and artificial intelligence, analysts say.

The Switzerland-based International Institute for Management Development ranked Korea's use of data for analysis 31st out of 63 countries last year. China ranked 12th. The United States was the No. 1 followed by Singapore.

The FSC has acknowledged the country does not have the environment, system and human capital to allow data to flow and be analyze freely in the market.

This why it is falling behind the United States and China, which have progressed in developing new industries using artificial intelligence, from using big data, it noted.

"Big data will bring forth the Fourth Industrial Revolution, which will then be converged with artificial intelligence, cloud computing and the internet of things," said Lee Tai-ki, a senior researcher at the Korea Institute of Finance

There are still limits to using and managing data under the cloud computing system for global companies, given that data created and generated here cannot leave the country, analysts say.

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