On Nov. 11, Daum Kakao and Korea Financial Telecommunications & Clearings Institute (KFTC) rolled out Bank Wallet Kakao, a mobile transaction service. Bank Wallet Kakao allows users to put money on their account, transfer small sums of money to friends or “cash out,” transferring money back into their bank account.
Bank Wallet Kakao essentially operates as an extension of Bank Wallet, a service developed by KFTC, an organization that manages inter-bank payment systems. Bank Wallet Kakao is available to use with sixteen South Korean banks.
The idea is that transactions are made through a virtual “mobile wallet.” Users can put money in their wallet for easy transfers. For the time being, the mobile wallet has a cap of 500,000 KRW (450 USD), with a limit of 100,000 KRW (90 USD) on daily transactions.
In order to use Bank Wallet Kakao, users need to go through a personal identification process to verify their identity and then register their bank account. After the initial registration process, users only need to enter a 6-digit password to get access to the app and a 4-digit PIN to make purchases or transfer money to their friends.
Bank Wallet Kakao is Daum Kaka’s latest venture into mobile transaction services. In September, the pre-merger Kakao launched KakaoPay, a service which let users easily access various credit or debit cards with a mobile app. The two apps represent the company’s latest initiatives to navigate around online transaction laws currently in place in South Korea, where mobile transactions currently requires SMS authorization and public key certificates.
The app’s main advantage is that it operates with users’ preexisting social networks. Users do not need to know their friends’ bank account numbers to make transactions and only need to select friends from their SNS contacts.
Daum Kakao and KTFG hopes that Bank Wallet Kakao can tap into the user base of KakaoTalk, Daum Kakao’s messaging service. KakaoTalk is the number one messaging service in South Korea, with over 37 million users in the country.
Although the number of partner vendors that allow purchases with Bank Wallet Kakao is currently limited, Daum Kakao remains hopeful of the app’s expansion. For the time being, specialists speculate the app will mostly find success in small transactions among friends.
Bank Wallet app is available for download both on Google Play and App Store.