An Introduction to Korean Banking

Category : Career/Business / Surviving in Korea
Nov 28, 2014

The Bank of Korea (Korea’s national bank), is the central financial authority in Korea responsible for printing money and doing other big national bank related things. If you’re arriving in Korea and you want to set up a bank account, the Bank of Korea can’t help you out. Rather you are going to need to visit a commercial bank. Most of the major commercial banks offer multilingual services for expats that include phone and internet banking services, expat accounts, special overseas remittance rates and debit and credit cards.

 

Main Nationwide Commercial Banks

 

Bank Name

Abbreviation

Name in Hangeul

Bank Code

Korea Exchange Bank

KEB

외환은행

005

Shinhan Bank

 

신한은행

088

Kookmin Bank

KB

국민은행

004

Hana Bank

 

하나은행

081

Woori Bank

 

우리은행

020

Industrial Bank of Korea

IBK

기업은행

003

Nonhyup Bank

NH

농협은행

011

 

Note: There are other banks in Korea that do specialized banking for agriculture and development. As well there are some local banks located in certain regions of the country. If you are in a remote area you may have limited choices and a regional bank may offer benefits that the major banks don’t provide.

 

International Commercial Banks for Personal Use

  1. Citibank Korea: bank code 027
  2. SC First Bank: bank code 023
  3. The Hong Kong and Shanghai Banking Corporation (HSBC): bank code 054

 

Note: There are some other foreign banks in Korea but they focus mainly on corporate banking, mutual funds and investing.

 

Setting up a Bank Account

It’s easy to set up a bank account and it’s free! All bank accounts in Korea do not have service fees. You need a passport, your Alien Registration Card (ARC), your full name as it appears on your passport, your address and your telephone number. Give all the info to the teller at your bank of choice, fill out a form, sign your name a bunch of times and walk away with a brand new Korean bank account. You will be issued a bank passbook which allows you to access the ATM and withdraw money, plus keep track of all your transactions.

 

Account Tips!

  1. You might not need your ARC card when setting up the account, however they will eventually want you to bring it in and register your card to your bank account. Some banks are strict about requiring an ARC card, while others are more lenient.
  2. You won’t earn interest on a cheque account in Korea, so apply for a savings account instead. Also if you have savings, switch the funds over into an investment (see Investment Options in Korea) so that you can make a higher interest rate.
  3. Register for internet banking, a credit card and a debit card all the same time. These all require your ARC and passport plus a visit to the teller, so save time by doing it all at once.
  4. You can link T-money to your debit card, so the money is withdrawn directly from your account. If this is something you would want, ask for it when you get your debit card.
  5. Your debit card number will not be the same number as your bank account and you will have two separate pins for your bank account and your debit card. Make sure you write down your bank account information in a convenient place.

 

Branch Service/Hours

Hours of operation for all bank branches nationwide are Monday to Friday 9:00-16:00. Banks are closed on the weekends and public holidays. The exchange banks at the airport are open over the weekend. Most banks have a 24 hour phone hotline, so it you have a problem (like you lose your debit or credit card on Saturday night) call immediately.

 

Some banks have special expat branches that cater to foreigners. These global branches and desks offer services in many languages. They provide better exchange rates and they usually have lots of foreign currencies on hand, even minor ones. They are familiar with overseas banking and procedures and can give sound advice to foreigners.

 

ATM Services

 

Bank ATMs

Bank ATMs are usually open from 8:30-22:00. Some banks have ATMs that stay open until 24:00. Most bank ATMs operate in many languages. They almost all have English, Japanese and Chinese while most have even more. You can check your balance, withdraw money, deposit money, make domestic transfers and in some places make overseas remittances at the bank machine.

 

Tip: Not all bank machines dispense or accept 50,000KRW bills. Look for the sign that says it can take large bills if you need to make a deposit or when withdrawing large amounts.

 

Street/Store ATMs

ATMs found in department stores, convenience stores, restaurants, and bus and train stations have longer operating hours. Some close at 24:00. Some stay open 24 hours a day. You will notice that your bank will close operations for 1-2 hours in the middle of the night. At that time it is impossible to withdraw money anywhere. Hours differ for different banks. Your bank usually charges a small fee (1,000KRW-2,000KRW) to do transactions from a street ATM. Street ATMs are beginning to have more multi-language operations however there are machines that will only offer Korean language service.

 

Debit (Check) Cards

When you first set up a bank account you will be given the option to get a debit card. In Korea they are called ‘check’ cards, but they are not to be confused with credit cards. When you use the card money is removed directly from your account so you won’t need to carry cash around. Although check cards are primarily debit cards, they can operate like a credit card. You need to ask at your bank about this function and it needs to be activated when you get the card. Check cards can also be used at any ATM so you don’t always need to find a branch of your bank to withdraw cash.

 

Debit cards in Korea come with many perks. They can be used to collect points or receive cash back so you can buy stuff later. You can use the same card for your T-Money too. The money will come directly out of your account when you ride the bus or subway. If you’re a student, your student card will also be a bank card. Some cards have RF technology so you can touch and pay.

 

Debit Card Tips!

  1. The account you choose will come with a recommended check card and you should ask for it if the teller doesn’t offer.
  2. Sometimes your check card will have a VISA or credit card symbol on it. Don’t be confused. It is not a visa card although you may be able to activate it so that you can use it similarly to a credit card. Ask at your bank.
  3. You can set your check card up to be a global check card if it has a PLUS, Cirrus or Interac symbol on the back. You can then use ATM machines around the world. This is handy if you plan to take vacations while living in Korea. Ask at your bank to activate it as a global card.
  4. You will have a daily withdrawal limit put onto your card recommended at 500,000KRW or 1 million KRW. You will need to ask to remove it and specify which limit you want.

 

Online Banking

In Korea, online banking is a bit more complicated than in most other countries, but you can be assured the online security is top notch. You must set up an online account with a teller. Bring all the usual documents with you just in case: bank passbook, ARC card, passport, and debit card. As well make sure you have your important information on hand like your address. You will be required to fill out forms and choose some security IDs and passwords for your online account. The teller will go through the online banking process with you. Pay attention because there are many steps:

  1. You will need to set up a digital security certificate. You can do this at the bank with the teller or back home from your own computer. It is recommended that you save your certificate to a USB so that you may access your account from different computers. If you install the certificate directly to your own hard-drive, you must always bank online from that computer. You also need a digital security certificate to shop online- another reason to set up an online account!
  2. You will need to download ‘Active X Program’. This is a security program that will ensure your account stays safe. All Korean banks use it and it’s effective except that it really only runs well with internet explorer. Consider switching your browser if you always use Google Chrome or Firefox.
  3. You will need a security code card from the teller. This card has a list of numbers that you use to form passwords each time you access your account. If you don’t have the card, you can’t log into your account. So keep it safe!
  4. If you want to transfer money to your home bank account, you can do so online. However you need to let the teller know you plan to make overseas remittances online. You can fill out a form that will designate that bank as your primary foreign exchange transaction bank and that will allow you to make transfers easily!

 

Smartphone Banking

With the advent of smart phones, our lives are certainly heading in a more efficient direction. All the major Korean banks either already offer smartphone banking or it’s being created currently: Kookmin Bank (KB), Woori, Hana Bank, Industrial Bank of Korea (IBK), Korea Exchange Bank (KEB), Shinhan Bank and Nonghyup Bank. Citibank also offers smart phone banking in Korea.

Smartphone banking is the same as online banking. You can check your accounts, register for new accounts, transfer money, pay off bills, and send overseas remittances. Hana Bank was the first bank to use smartphone banking. They offer online financial banking, an online coupon service (where you can download coupons using their application and use them directly off your phone) and a GPS service (unrelated to banking or spending). After that others followed and now it’s a requirement for customer satisfaction. Not all banks offer online or smartphone overseas remittances. KEB does.

The process is a bit complicated and very similar to setting up an online account. You will need to have an online account already set up. Use your regular online banking passwords when it prompts you. It will be the same for your smart phone banking application.

  1. The first step is to gather what you need:
  • You must have online banking and a digital certificate on your computer or on a thumb drive.
  • Your smartphone (iOS or Android)
  • Your ARC number
  1. You will need to download the banking application from your bank. This application allows you to access your account and also view the website from your smartphone.
  2. Next your need to get your digital security certificate onto your smartphone. You can copy it directly from your computer when your smartphone is plugged in. Most Androids have a USB, so if your digital certificate is on a USB (recommended) you can plug it directly into your phone. There should be a special option that says “send digital certificate to smartphone”. Click that and the process should begin at once.
  3. Open your smart phone banking application on your phone. You will receive a number.
  4. Put that number into your digital certificate on your computer. This tells the banking security that the certificates match and you can proceed. Your smartphone is good to go! You’ll just need your passwords and passcode card to access your account.
Tags : Bank. Online Banking. ATMs. Money. Business.

Lindsey lived and worked in Seoul, South Korea for over 5 years. While there, she dabbled in different areas of work and explored the culture. She spent time teaching elementary students, business English to adults and high school students about college preparation. She also studied Korean, wrote blogs and tasted as many foods as she possibly could including fermented skate fish. Over the years, Lindsey developed a love for Korea and the culture. She is keen to share her knowledge of Korea with others and she will always consider Korea a second home.

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