A big change is coming to South Korea’s banking industry.
Hot on the heels of the launch of Korea Telecom’s internet K Bank, another online-only bank is about to be launched by Kakao Talk, the country’s biggest messenger app.
Both banks allow customers to bank just from their smartphones, from opening accounts to applying for loans.
The digital-only banks won’t have any actual bank branches, but of course users can stop at real-world ATMs to get cash.
This success is expected to be repeated by Kakao Bank, which is backed by several companies including China’s Tencent, which owns WeChat, China’s biggest messenger app.
Kakao Bank plans to use data from its affiliated companies, such as ride-hailing app KakaoTaxi, to help it determine users’ credit scores, according to the Korea Times.
Korean financial regulators gave their stamp of approval for the bank on Wednesday, and the service is expected to launch as early as May.
Plans to launch digital-only banks in the country have been around since Nov. 2015, when the country’s regulators gave preliminary approval for both Korea Telecom and Kakao to set up internet banks.
Digital-only banks are starting to pop up at an increasing rate globally. In the West, the U.K.’s Atom, Germany’s Fidor, and Ally in the U.S. are quickly gaining popularity.