Main issues surrounding separation of banking and commerce for Internet-only banks 1

At an event on Tuesday, President Moon Jae-in called for steps to slash red tape in the country's financial sector. The main focal point.... was the separation of commerce and banking. For more on this issue, we have our business correspondent Kim Hyesung in the studio with us today.So what regulations does the president want to do away with? So before I jump into the separation of commerce and banking, I want to touch on the popularity of Internet-only banks.Before the launch of these banks in Korea, people had to visit physical or "brick and mortar" branches in person, wait in line, write and sign documents...and spend over half an hour opening a bank account. Now with Kakaobank and KBank, users can create an account within ten minutes just with their smartphones and send or receive money with a single click, without uploading financial authentification certificates. Thanks to their efficiency, the number of Internet-only bank users has ballooned to about seven million people in about a year... with loan issuance amounting to seven-point-two billion U.S. dollars. The popularity has benefited consumers and also helped accelerate financial reform and lower transaction costs at traditional banks. But for internet banking businesses to expand further, provide more financial products and services, they need to raise capital. But under the current Banking Act, the separation of commerce and banking blocks that.Introduced to prevent banks from being used as companies' own private funding source, it stipulates that non-financial business operators cannot hold more than four percent of the total number of outstanding voting stocks of a bank and ten percent of its stocks... Take a look at this graph, the share ownership of Kakaobank was launched by local IT giant Kakao, but it owns only 10 percent of its stocks....the majority is owned by Korea Investment Holdings. For Kbank, it's even more divided and complex... owned by traditional banks and others.