“The MyData service has been out of date.”
You may wonder why I would say such cold words about the MyData service, which was launched in January 2022 and has just begun to establish itself, but unfortunately it is true. The interest in the use of asset management services and personal information utilization sparked by the two major fintech companies, such as Toss and Bank Salad, was legislated in January 2020 in the form of a revision to the 3 Data Acts after a three-year legal battle. As a result, the financial and telecommunications industries, which have been handling personal credit information, have been able to launch their own services (MyData service) by collecting the credit information of credit subjects (individuals) in a legal, systematic way. After two years of standardization and system establishment, a total of 33 companies, including the five major commercial banks, finally opened the MyData service in January 2022.
MyData operators (businesses licensed for personal credit information management) have started recruiting users with unique brands and catchy promotional phrases. However, there was a service that they had in common, which was the integrated asset management service introduced by the two leading fintech companies, which can be regarded as their ancestors. Why is this integrated asset management service, inherited from a common ancestor, being evaluated as outdated just four months after it was created?
After revising the 3 Data Acts, most financial and telecommunications companies competed to obtain licenses for MyData operators. As of April 2022, 55 operators have been licensed, and about 20 more are expected to be added by the end of the year. However, screening of business operators starting this year has become more difficult. On April 13, 2022, the Financial Services Commission announced that the MyData license criteria changed, saying, "You will not be able to obtain business licenses only with simple brokerage and trading of financial-related data.” This means that it is clear that integrated asset management is a key element of MyData, but it is no longer necessary because enough operators already have this service. It can also be seen as a demand for innovative services.
However, in the meantime, MyData operators have not come to the market with only integrated asset management services. They also have their own derivative services based on the personal credit information they collect. From a financial product recommendation service that analyzes credit card consumption patterns to recommend cards for the company and related companies, to a lifetime fund design service that offers consultations on consumption, expenditure, and investment plans to achieve the goal after asking the user's asset management goals, although the same data was collected, there were many attempts to discover new value in it.
Nevertheless, it is clear that the simultaneous appearance of 30 or so operators with the same core service will bring about rapid market saturation. Even if it is not the demand from the financial authorities, it will be difficult for latecomers to enter the market with services similar to those of leading companies. Operators that have entered the market earlier may lose their customers to new operators armed with innovative services if they remain complacent without offering new services or changes.
Then, in a situation where the same data is provided to everyone, can a newer and better service emerge?
Financial authorities also prepared a solution to this. On April 12, the Personal Information Commission held a report on the launch of the MyData format-transmission method standardization project, announcing the start of the MyData standardization project in all fields, not the existing MyData in the financial field. Following the rapidly prepared financial industry under the supervision of the Financial Services Commission, it is laying the foundation for a "real MyData service" that encompasses all personal information, such as distribution, education, land and transportation, and culture and tourism. When this business starts in earnest, it will be possible to collect a variety of personal information and provide MyData services next year in short, or from 2024, two years later, referring to the precedents in the financial field. At this point, wouldn't it be worth calling it "MyData 2.0," since it is a complete upgrade of the existing MyData?
It is natural for innovative services that could not be planned to emerge when new data is gathered. It is definitely a good news for existing MyData operators and prospective operators. At this point, it is expected that MyData operators will be able to walk their own path independently of the services of the two major fintech companies. It is the first true battle among business operators in the new world.
It is uncertain what services will be presented in front of us in the era of MyData 2.0. This is because we do not know what information will be provided in what field and which business operator will surprise us with a brand new plan. First, the outline of the information given is expected to be revealed to some extent by early next year. This is because the ongoing "MyData Format-Transmission Standardization Project" will end in January 2023. When the results of this standardization of transmission is disclosed, in terms of technology, it is necessary to quickly acquire data exchange technology between different industries to overcome the hurdles of linking with existing financial data, and in terms of business, it is necessary to find novel services that converge with new information.
MyData operators will again prepare for a sprint race of service planning and system construction at a new starting line. However, even if it is new data, it is eventually given equally to all operators, so if you start referencing and imitating leading companies, you are likely to encounter market saturation again. In the end, the key will be who comes up with an idea first, puts it into action, and quickly implements the service. Preceding business operators will be able to attract customers by leading those who come after them. The key driving force to stay ahead is the idea and capability to establish services. However, the limitations of ideas coming from the same information are clear. If you can find or create personal information that other MyData operators do not collect without going beyond the boundaries of the Personal Information Protection Act or the Credit Information Act, you will be able to provide differentiated services.
Many MyData operators are already collecting and servicing personal asset information by combining vehicle or real estate market prices with personal information. New personal information was created by combining information disclosed as public data with personal information. This approach can be useful in the future. In addition, if you obtain consent from users and get family relationship or personal network information, it will be possible to go beyond the existing personalized lifestyle consulting and provide personal network-based consulting that encompasses family, friends, and colleagues. It does not deal only with quantified typical information. If you can obtain atypical information, such as personal taste and wants through additional services, such as games or psychological tests, it will be possible to plan new services accordingly.
Unlike previous services that recommended the purchase of a car to frequent taxi users, how about offering a financial management consulting to purchase a higher model to a person whose friend bought an expensive imported car? What if you can plan a birthday party and overseas travel according to your partner's consumption tendency and travel preference? When these services become available, MyData will go beyond "information sovereignty" and position itself as a "life partner" service.
Ideas and planning alone are not enough to take and maintain a leading position in the MyData business. It is necessary to have an information collection system that can secure various public and open data to help innovate planning. The scope and method of collection of MyData in all fields have not yet been determined, but public and open data is everywhere. If there is something that must be prepared before 2023 or 2024, when the horizons of the MyData business will broaden, it is a collection system that can find and secure these data first.
Soon, the era of MyData 2.0 will start, and all operators will once again be on the same starting line. You have to get ready before that. This is because if you predict the information that will be released and prepare well, you will no longer be on the same starting line.
▶ The content is protected by the copyright law and the copyright belongs to the author.
▶ The content is prohibited to copy or quote without the author's permission.
Platform Group of Data Innovation Business Team, S-Core Co., Ltd
He is in charge of developing the MyData platform.