In brief
- A top Korean bank will use blockchain-based KYC to remotely open customer accounts.
- Korean crypto firm Iconloop will provide the underlying blockchain.
- The country's government is betting big on blockchain to spur economic growth.
One of Korea’s most prominent crypto and blockchain firms, Iconloop, announced a partnership yesterday with Shinhan Bank, the country’s second-largest commercial bank, to issue Know-Your-Customer (KYC) compliance certificates, as per a release.
It is one in a long list of blockchain and crypto-based projects to be launched in Korea’s public domain this year. Others include an Ethereum-powered beach payments system and the use of blockchain-based apps for verifying driver’s licenses, with Iconloop’s new development one of the first instances of a bank-crypto firm partnership.
Through its mobile app Zzeung—which uses the firm's blockchain-based decentralized identity (DID) service—Iconloop will issue a KYC certificate accessible on its native blockchain for any interested users, who can then remotely open a Shinhan bank account using just their mobile app. This eliminates the need for paper documents and other extensive compliance demands, the release said.
2/ Next, users select ‘Shinhan Bank KYC Authentication’, and then a Zzeung KYC compliance certificate is issued and stored on their mobile phones once Shinhan Bank verifies the users’ identity.
— ICON (@helloiconworld) August 26, 2020
Shinhan Bank-issued compliance certificates will be also applied to various other identity verification services used to access Shinhan’s mobile banking services, including mobile password issuances, password changes, and other customer verification needs.
Users holding the compliance certificates can also use the KYC facility with Shinhan’s partner companies, making it faster for them to access financial services, such as brokerage, credit card, and insurance accounts.
Jong-hyup Kim, the founder of Iconloop, commented on the launch, "This issuance of compliance certification with Shinhan Bank is of great significance because it is the first commercialization of DID services used in the financial sector in Korea.”
Zzeung is one of the main players of the MyID Alliance, a blockchain-focused—and government-recognized—consortium in Korea with over 77 members ranging from commercial banks to local governments and e-commerce companies.
This year, the country’s Financial Services Commission approved Zzeung into its financial sandbox to allow the development of compliance certifications and other identity verification services using blockchain technology.
The development comes as the Korean government is touting a massive investment in blockchain and other rising technologies such as AI. It has already put aside $400 million in a special investment vehicle for the purpose and is even pursuing research on a potential digital won, Korea’s digital alternative to its fiat.