Regulators examining credit card companies’ cyber security measures


Shinhan Card drew the highest number of complaints from customers last year in the local credit card industry.

According to the Credit Finance Association, Shinhan Card was responsible for 447 dispute cases filed with financial regulators in 2011.

Shinhan has been capturing more than 20 percent of the credit card market since acquiring LG Card, formerly No. 1 before the 2003 credit card fiasco.

Disputes between customers and card issuers included voice phishing scams and card companies’ blackmailing of delinquent cardholders, according to the Financial Supervisory Service.

Shinhan said it had a high number of complaints as it holds the highest number of customers in the market.

KB Kookmin ranked second with 430 cases, Hyundai Card with 352 cases, Samsung Card with 306 cases and Lotte Card with 240 cases.

Among capital service firms, Hyundai Capital drew the most complaints with 131 cases.

FSS officials say a growing number of credit cardholders have been suffering damages from voice phishing scams due to the companies’ weak cyber security systems.

The regulator is conducting inquiries into major credit card companies to monitor their cyber security measures against possible leaks of customer information.

The FSS also has pledged to conduct a more intensive inquiry into the overall financial industry.

Credit card companies are fighting another marketing war despite financial regulators’ warnings against signing up too many customers.

Shinhan Card, has tried to attract customers for mobile phone settlement-based credit cards by developing products in tie-ups with SK Telecom, KT and LG Telecom.

Samsung Card, the third-largest issuer, has been aggressive in developing new products under its reported strategy to overtake KB Kookmin Card, the nation’s No. 2 player.

Samsung Card is moving to launch a “number series” such as Samsung Card 2 and Samsung Card 3 Plus. The new lineup will include products numbered from 1 to 7.

Each product will likely be diversified to target specific consumers such as female cardholders in their 20s or middle-aged male drivers.

Hyundai Card will try to attract customers to the “Hyundai Card Zero” which offers discount services with no conditions from Monday. All customers enjoy a 0.7 percent discount.

The card provides holders with an extra discount of 0.5 percent when they use it at restaurants, coffee shops, large discount chains and convenience stores.

By Kim Yon-se (kys@heraldcorp.com)