South Korea loves paying by plastic, but thanks to the latest data breach in the region, could its popularity be up?
South Korea has an estimated five credit cards per Korean citizen, it’s undeniable that the nation loves cards, and yet despite having EMV security they still have many data breaches in the region, so should security be beefed up?
The latest case, which happened on January 8th, has seen the heads of three big South Korean credit card firms resign after apologising. So now KB Kookmin Card, Lotte Card and NH Nonghyup Card went without heads on the 20th January, with 20 executives following them in their resignation too.
Obviously it’s incredibly humbling to see such passion to customers for a blunder that saw around 20 million credit-card holder’s personal information stolen by an IT contractor. He was said to have transferred over the details of 104m accounts while he was working for the Korea Credit Bureau, which – ironically – evaluates risk for the card companies in question. Even more worrying is the news that two managers of marketing companies have also be arrested for having bought the details he stole.
While it’s reported that none of the stolen or leaked details could be used for authorising payments and stealing cardholder’s money, there were still 2.6m requests to reissue or cancel card in the first three days since the case went public.
While the security involved in this situation is all entirely managerial and to do with data protection, the implications that this will have on a nation who love to spend through what they once believed was a secure method could have some strong knock-on effects. Will South Koreans spend less now they feel that their method of choice is under threat more frequently?
Perhaps now is a good time for South Korea to look forward to what the future holds in the payments space?
As more and more of these security breaches happen around consumer information, now may well be a lucrative time for alternative payment providers to move into the space of South Korea.
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