South Korea falls among the most stringent law bearers of their citizens, globally. Hence, they’ve been trying out various ways to control and study their population, keep a track of the number of citizens doing certain kinds of work and there are hundreds of other reasons to implement KYC. KYC can be expanded as Know-Your-Customer. The South Korean Govt has been trying to implement this particular law for a prolonged time but due to certain obstacles, they couldn’t. They have also proposed to implement AML or anti-money laundering compliance processes along with KYC. The issues for implementing both come when experts figured out various applications in implementing both the laws together.
The existing Personal protection act will be contravened if the new laws are implied on the citizens. This stipulates that no local companies will be able to legally request a “social security number”. Here comes relief from the stress, according to digital today, the measures will cover the financial institutions, anyhow, one is capable of requesting for it under exceptional circumstances which include major monetary transactions. There are always some ways to make your way out if you follow the laws correctly.
When will the new system be enforced?
System enforcement is speculated to be done by the end of March 2021. The decree is known as the Special Payment Act. To enforce this certain law on citizens, the authorities will require “virtual asset services providers”. This is needed to filter the original identities of the customers who are enrolling their names. The verification of the originality of the data will be done using citizens social security numbers, maybe. There can be other identity proofs too that will do the work.
The law will not grant the virtual asset that operates the dignity and status of financial company operators, nor will they be integrated into institutional financial companies when the revised financial law enforcement bill will be implied. This statement was given by the financial information analysis institution who said that even if the particular AML-KYC is imposed, the virtual asset holders will not be considered a financial institution. Hence the crypto investors might not be quite benefitted by the amendments.
Many financial analysts think that even if the KYC-AML system is imposed, the crypto-industry has a long-lasting way to go even if they are included in the Virtual Asset Business Rights Act. The act is likely to be implemented in the 2021 march and hence, the government has issued various rules and regulations that need to be followed along with various papers that should be presented during the enrollment.
- Real-name account
- SMS authentication
- Report their operations within six months after the law’s implementation
Experts believe that the new system, its merits, and demerits needs to be discussed to the common public who are the investors and are potential investors. The only way to implement a law that will run smoothly is by preparing government officials dealing with the KYC-AML process.