The Korea Herald


Korean commercial bank apps struggle to stave off competition

By Jung Min-kyung

Published : June 18, 2019 - 14:42

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Almost two years after South Korea’s leading commercial banks launched mobile apps to attract new customers and keep existing ones, the focus is now on whether their quality matches the prestige of the banks they are attached to.

To compete against fast-paced and innovative internet-only banks Kakao Bank and K-Bank, the big four -- Shinhan, KB Kookmin, KEB Hana and Woori -- have been providing low-cost services, merging separate apps into one, and even hiring K-pop celebrities as brand ambassadors.

But overall, they are struggling to build solid identities in new areas of banking, failing to outperform online banks and even money transfer app Toss, which have won over younger consumers. 

K-pop boy band BTS stars in a commercial for KB Kookmin Bank’s mobile app “Star Banking.” (KB) K-pop boy band BTS stars in a commercial for KB Kookmin Bank’s mobile app “Star Banking.” (KB)

According to a survey released last month by app analytics firm App Annie, KB’s KB Star Banking was the only app developed and operated by a commercial bank that had more monthly users than Toss and Kakao in March. The survey placed it No. 1 in a top 10 ranking of mobile banking apps in Korea that took users of both iOS and Android apps into account.

Kakao was ranked 2nd with Toss closely tailing behind in 3rd.

Shinhan’s all-in-one banking app Sol was placed 4th, while Woori’s One Touch Personal Banking placed 6th behind NH Nonghyup’s Smart Banking.
Hana’s 1Q Bank followed at No. 7, ahead of KB’s second app Liiv, ranked No. 10, which is centered on money transfers, compared to its main app.

App Annie added that the customers of Kakao Bank and K-Bank frequently accessed the apps, but, at the same time, spent comparatively little time on the apps.

This suggests that the two are capable of providing the smoothest interactions for their users, the analytics firm explained.

Despite the global trend to integrate all tools into one app, traditional banks remain behind online banks in customizing tools for their user bases.

Shinhan is the only commercial bank with a genuine stand-alone app at the moment. It previously operated six different bank apps before its decision to integrate them in February last year, making it the first commercial bank to provide an all-in-one service.

KB may be outperforming online banks with a number of loyal followers, but it’s also confusing them by promoting three different apps to its users.

KB recommends its customers to download all three -- Star Banking, Liiv and Liiv TalkTalk -- which the bank claims to have different features.

According to KB, Star Banking allows users to manage all of their accounts alongside complex matters such as loans and installment plans, while Liiv handles simpler bank transfers. TalkTalk features a messenger platform where customers can access services they want by sending a text message.

KB plans to update its Star Banking app in August, which will allow users to create accounts or take out loans via mobile, but it has no imminent plans to merge all of its apps into one, Park Kyung-jin, a spokesperson for KB Bank told The Korea Herald on Monday.

Hana also has at least two main apps -- with one more focused on asset management and the other centered on cash transfers. Woori mirrors it with One Touch Personal Banking and its second app WiBee. 


Looking at the comment sections of Google Play, a common criticism of traditional bank apps is that their retina scans or fingerprint log-in functions did not work properly. 

Actor Park Bo-gum stars in a commercial for Shinhan Bank’s mobile app “SOL,” as the firm’s new brand ambassador. (Shinhan) Actor Park Bo-gum stars in a commercial for Shinhan Bank’s mobile app “SOL,” as the firm’s new brand ambassador. (Shinhan)

Complaints about errors in the access process or the apps’ overall slow responses were also dominant issues. Many also had trouble understanding the interfaces, which sometimes overlook key functions.

With Shinhan SOL, its users described the app as “too heavy,” indicating that the app had failed to provide a comfortable all-around transaction process.

The speed of the process was often unfavorably compared to Toss and Kakao Bank, which according to its users, took “less than five seconds” to log-in.

The competition between banking apps is expected to further heat up later this year, if Viva Republica -- the operator of Toss -- and Kiwoom Securities succeed in their second attempts to establish the nation’s third and fourth internet-only banks.

“Commercial banks must keep in mind that progress in fintech means growth in mobile app usage – which could determine the banks’ competitive edge,” said Lee Soon-ho, an analyst at Korea Institute of Finance.

By Jung Min-kyung (