- The First in a Series of Six Special Reports -
Breakfast in Paris, a business meeting in Korea, and a bite of a sandwich under the Golden Gate Bridge in America - if only mankind could jump through the optical fiber cable of high speed Internet connections, who would refuse to teleport around the globe to expand one's scope of activities To people, therefore, teleportation is only science fiction. But for money, teleportation is the preferred way of travel today.
The IT boom in the late 90s pumped up communications infrastructure to the degree where a dollar bill can teleport from one end of the country to the other in the blink of an eye. In terms of e-Finance, the nationality and color of the money does not matter. While some of the new IT convergence projects like u-Healthcare are caught in up in the problems of slow standardization progress before commercialization, e-Finance already has the advantage of the globally standardized Internet. e-Finance, in this sense, is a promising miracle worker that is a guaranteed golden gate of any country in terms of trade, business, and global recognition. It is no question that Korea's forte is its world-class IT infrastructure - now that we have it, what are we going to do with it in order to write the new history of the e-Finance sector
E-Finance, the Universal Economy Icon
Up to 10 trillion dollars is expected to be transmitted through online banking this year. In 2008, nearly 404 trillion dollars was transmitted around the globe. The amount of transactions made in the global e-Financial market is estimated to be fifty times more than the scale of online banking transactions made within Korea. Financial markets with their products and services are all global nowadays and mostly determined and shaped by ICT. Online transaction service charges have been a great source of revenue for financial companies. Paypal, for example, has been promoting the lowest service charge of 2% as their marketing strategy in e-Commerce business. In 2004, the company gained 59 billion dollars from service charges, but their profits increased to 234 billion dollars in 2008. Since the beginning of the online advertising market in 2005, the market revenue rose from 8.8 billion dollars to 31.1 billion dollars this year.
Financial Juggernauts from the Past
Singapore and Dubai have long held global reputations as financial juggernauts. While Korea and other countries restricted the flow of capital 30 years ago, Singapore encouraged foreign exchanges with its banks freely. Under Lee Kuan-yew's administration, Singapore started a financial industry by providing flexibility for its banking system. This created a whole new money market for Singapore; service charges fed the entire city. The size of the fund increased every day and the money flowed in. Now that most countries opened their finance gates wide to foreigners, the Singapore finance industry needs something extra special to retrieve its former glory. The Dubai financial industry, on the other hand, went straight from the bottom to the top. When the government began promoting the financial industry as the new growth engine, its strategy topped oil funds on its hardware. Architecture and cutting edge facilities are only a bonus to the circulation of funds it has secured from oil and its clients.
The Time is Right
Singapore's open policy put the country in the position to be a universal financial site 30 years ago, and Dubai's oil funds and hardware registered the country to be the financial hub of the world ten years ago. "The next financial juggernaut, however, will be decided based on its software and Korea has the best qualification to be the best suitor due to its highly advanced e-Finance infrastructure," predicted CEO Lee Sung-man of Torus Networks (www.torus.co.kr). Korea has been successfully applying information technology to the e-Finance industry and has done an incredible job in spreading its wide utilization within a short time period. "We no longer have restricting factors to shut off foreign clients in the finance industry. Every nation today has a mutual degree of financial policies and regulations, and the Korean financial legal system meets the global standard as well," said Lee. The question then is how fast will Korea secure its security line to gear up for the global finance market.
Last Piece of the Puzzle
With the strength in IT, the only assignment left for Korea to accomplish is to find one last missing piece of the puzzle: security. "The completion of security is equal to the victory of the e-Financial Power," CEO Lee said. "Without IT infrastructure and security, there can't be an ideal e-Finance and without the completion of e-Finance, there won't be global finance." Therefore, what makes the e-Finance system competitive is the IT infrastructure and security of the country. Korea, in this context, is already in front of the competition with its highly advanced IT infrastructure. The e-Finance movement has arrived in Korea with perfect timing. "Electronic finance transaction had security issues because it was done in the PC, which means, it can also be easily taken care of with the utilization of the IC Card," said Lee. Currently, Torus Networks' Smart Way has been suggesting a revolutionary way of online banking security.