Major South Korean bank-affiliated card companies are introducing or strengthening usage limits on corporate check cards following a Financial Supervisory Service (FSS) request early this month to address money laundering concerns. The FSS identified criminals establishing corporations or colluding with existing firms to purchase large quantities of gift certificates using unlimited corporate check cards, then reselling them for cash. Card companies including KB Kookmin Card and NH Nonghyup Card are implementing daily and monthly transaction limits or reviewing separate gift certificate purchase caps, as existing regulations under the Specialized Credit Finance Business Act and corporate membership terms do not mandate usage limits, leaving implementation to individual card issuers' discretion.
FSS Requests Anti-Money Laundering Measures for Corporate Check Cards
Early this month, the FSS requested bank-affiliated card companies to strengthen monitoring and suspicious transaction reporting (STR) regarding money laundering methods using corporate check cards. The regulator expressed concern over voice phishing and money laundering criminals who establish corporations or coordinate with existing corporations to purchase large volumes of gift certificates using corporate check cards from banks without usage limits, then convert them to cash through resale. Five bank card companies—KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup—account for approximately 98% of total corporate check card transaction volume among all credit card issuers, making them the focus of this self-correction request.
KB Kookmin Card Plans Q3 Limit Introduction, NH Nonghyup Card Reviews Gift Certificate Caps
KB Kookmin Card, which previously had no corporate check card usage limits, is preparing to introduce daily and monthly usage limits with a target implementation in Q3 this year. NH Nonghyup Card, which holds the largest market share at approximately 29% of corporate check card transaction volume, already operates daily and monthly usage limits and is internally reviewing the establishment of separate gift certificate purchase limits in response to the FSS request. The implementation of basic usage limits for corporate check cards has been left to individual card companies' discretion, as there are no specific provisions in the Specialized Credit Finance Business Act or corporate membership terms.
Shinhan Card Operates 2 Billion Won Monthly Limit, Woori and Hana Card Apply Lower Thresholds
Shinhan Card has operated a monthly usage limit for general corporations since May, though its 2 billion won threshold is higher than limits at other card companies already operating corporate check card usage caps, raising questions about practical effectiveness. Woori Card applies relatively low limits with a daily maximum of 10 million won and a monthly maximum of 50 million won. Hana Card also maintains a basic monthly usage limit of 50 million won. A financial authority official stated that corporate check card usage limits are fundamentally operated autonomously by each card company, noting that some card companies without previous limit restrictions are newly establishing usage limits. A card company official explained that while companies have been filtering suspicious transactions through fraud detection systems (FDS), the move to set usage limits appears aimed at fundamentally blocking money laundering methods involving gift certificate purchases followed by resale.
FAQ
What did the Financial Supervisory Service request from bank card companies early this month?
Early this month, the FSS requested bank-affiliated card companies to strengthen monitoring and suspicious transaction reporting regarding money laundering methods using corporate check cards, specifically targeting criminals who purchase large volumes of gift certificates and resell them for cash.
Which card companies account for most corporate check card transactions in South Korea?
Five bank card companies—KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup—account for approximately 98% of total corporate check card transaction volume among all credit card issuers in South Korea.
What are the current corporate check card limits at Woori Card and Hana Card?
Woori Card operates a daily maximum limit of 10 million won and a monthly maximum limit of 50 million won, while Hana Card maintains a basic monthly usage limit of 50 million won for corporate check cards.
