South Korea’s top financial regulator said Thursday it has decided to relax regulations on five promising services proposed by local companies in continued efforts to spur innovation in the finance sector. 

The move is part of the government‘s “regulatory sandbox” policy, which took effect in April last year. Under the regulatory program, the financial authorities suspend legal and regulatory requirements imposed on local financial companies, including both traditional and fintech players, for about four years, to boost their development of new business models and services in the market. 

The decision allows Shinhan Bank to conceive a mobile-based personal authentication system on which consumers can pre-register photos of their identification card or driver’s license and open new accounts at bank branches without having to present related documents.

The list also includes a joint service between Carrot General Insurance and SK Telecom. The companies introduced a promotional activity that offers a 10,000 won ($8.97) gift certificate every month to subscribers of Carrot General’s car insurance product using telecom operator’s T Map navigation platform. 

Hanwha Life Insurance’s service of offering vouchers, instead of insurance money, that can be used at online shopping platforms to subscribers also won the regulator’s temporary greenlight.

Along with major financial companies, a local fintech firm Pay Here, obtained a grace period for operating a mobile application designed to help small merchants win memberships from credit card companies by submitting image files of paper documents. 

A local software developer A&B Korea came up with a mobile app to process credit card transactions by using radio frequency.

Since the regulatory sandbox kicked off last year, the FSC has selected a total of 120 new financial services to apply relaxed regulations to. Most of the newly-added companies’ businesses will be officially launched next year, officials said. 

By Choi Jae-hee (cjh@heraldcorp.com)