The unauthorized transactions on Toss, an online money transfer platform operated by fintech startup Viva Republica, are likely to trigger extensive inspections of similar solutions by the financial watchdog.

“We plan to conduct reviews of fintech systems that adopt payment technology similar to Toss, if necessary,” an official from the Financial Supervisory Service said.

“Some 40 companies could be subject to such inspections,” the official added.

The Seoul-based startup said earlier this week that a total of eight payments were made on the platform without permission of account owners. The amount of the payments, worth some 9.4 million won ($7,900), is relatively small, but the latest case could dampen excitement in the fintech industry, which has been garnering growth momentum thanks to the government’s support policies and customers’ growing preference for contactless services amid the ongoing coronavirus pandemic.

Viva Republica said the account owners’ data had not seemingly been leaked via the Toss platform since personal identification numbers, among other data points including names and dates of birth, are not stored in the company’s servers. It delivered compensation to the eight victims right after it discovered the records of the unauthorized transactions.

The company has been criticized for belatedly announcing the incident. The unauthorized transactions took place on June 3, but the company publicly announced the case six days later.

Upon news on possible inspections by the FSS, Viva Republica said that it would “fully cooperate to find out who had illegally stolen the personal data.”

Established in 2011, it is the first fintech startup to achieve unicorn status --- valuation of over $1 billion. Viva Republica is valued at $2.2 billion.

The company has received a preliminary license to run an online-only bank here, and aims to launch it as early as this year.

By Kim Young-won (wone0102@heraldcorp.com)