Regulatory Reform
The Korean government is relaxing regulations on fintech and unmanned aircraft, or drones, in hopes that they will create economic benefits and become part of the convergence industry.
The government has set five major tasks for its initiative, called Regulatory Reform Step 2. One of the tasks is to innovate the controls and regulations of the convergence industry. The latest issues emphasize the needs of regulatory improvements for fintech, drones, and mobile health care appliances. Given the quick move of the U.S. and Japan to dominate these promising future industries, the Korean government could not delay relaxing its regulations any longer.
Japan, for example, is planning to expand the scope of financial holding companies so that subsidiaries can be involved in the fintech industry. Previously, only banks and securities firms could be counted as subsidiaries of a financial holding company. But under the new system, financial businesses relating to e-commerce and fintech can also be accredited as subsidiaries.
In the U.S., the Federal Aviation Administration (FAA) has recently announcing relevant guidelines for commercial drones. They say that those 17 years old and older can can get drone licenses after passing a written test and paying a $200 fee. It is intended to ease regulations enabling people to run drones like cars, not like aircraft, which are restricted with heavy regulations. However, for commercial use, the controllers must be seen with the naked eye, and there will be flight ceiling of 500 feet (150 meters) during the daytime. Also, only drones of less than 55 pounds will be allowed.
The Korean government is following these regulatory trends to also provide relaxed fintech and drone industries. The Financial Services Commission has decided to allow free investments in those businesses. It will abolish made for security to minimize drone regulations.
A government official said, “The existing regulations preventing the creation of new industries will be recommended to reform and we will establish new system to improve our industrial environment.”