Kakao Bank Opens

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Korea's second internet-only bank went online yesterday. Kakao Bank is based on the Kakao Talk platform used by more than 40 million people in Korea. Consumers are reacting positively to the online bank since they're able to make bank transactions with just a few clicks.

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More than 180,000 accounts were opened in just 12 hours after Kakao Bank went online. Within 24 hours since its launch, Kakao Bank accounts exceeded 150,000 commercial bank accounts set up through non-interpersonal means over the past year. The system even experienced connection problems as the site was overloaded with users. Customers were drawn to the new banking service by the free offering of Kakao Talk characters.

[Soundbite] Kim Yong-wuk(Seoul Resident) : "As soon as I saw it, I decided to open an account. I picked one of Kakao characters, which is going to be printed on my debit card. I want to let others know about it, too."

Kakao Bank says it is possible to send money to another party without knowing the account number if the recipient is registered as a Kakao Talk friend. The online bank plans to lauch integrated services that make full use of the existing infrastructure.

[Soundbite] Yun Ho-young(Co-chair of Kakao Bank) : "Customers will soon be able to use Kakao Taxi and other Kakao-related services with Kakao Bank account."

Kakao Bank has emerged as a competitor of another online-only bank, K-Bank, which opened in April. The popularity of internet-only banks compelled commercial banks to go into emergency mode. Their countermeasures include lower fees to the level of online banks and simpler payment services. Also, commercial banks will introduce various savings and lending programs with different interest rates matching customers' credit ratings.