The nation’s three Web-only banks might launch later than expected as their preparations have been disrupted by the COVID-19 pandemic, but they are still expected to commence operations by the end of this year, the Financial Supervisory Commission (FSC) said on Wednesday.
The commission in July last year approved applications by Chunghwa Telecom Co (中華電信), Line Financial Taiwan Corp (台灣連線金融科技) and Rakuten Inc to set up virtual banks — Next Bank (將來銀行), Line Bank (連線商業銀行) and Rakuten International Commercial Bank Co (樂天國際商銀).
The commission told reporters in January that Rakuten Bank would take the lead by launching its operations this month, while Line Bank and Next Bank would launch in the third quarter, according to documents submitted by the three banks’ preparatory offices.
Although the three banks have obtained approvals from the Fair Trade Commission (FTC), none of them had begun simulation tests as of Wednesday, Banking Bureau Deputy Director Sherri Chuang (莊琇媛) told the Taipei Times.
The one-month simulation test is an important milestone before virtual banks can apply for a license from the FSC, which has to review the test results to see if the banks are ready, especially in terms of information security, Chuang said.
“The banks are proceeding at a slower rate than their original plans, as some have hired foreign engineers to help set up their information system, but some could not come to Taiwan due to border controls amid the pandemic,” she said.
Chuang did not reveal which Web-only banks are facing such challenges, but said the commission still expects the banks to start by the end of this year.
Next Bank, which aims to begin operations at the end of September or at the beginning of October, plans to conduct simulation tests next month, general manager Liu I-cheng (劉奕成) told the Taipei Times by telephone.
The bank is speeding up the establishment of its information system, with its engineering staff working during the Dragon Boat Festival, Liu said, adding that as most of its engineers are local, the bank was hardly affected by the outbreak.
Rakuten Bank would soon conduct the test and intends to start operations by the end of September, company chairman Chien Ming-jen (簡明仁) said by telephone.
Rakuten picked International Business Machines Corp (IBM) to set up its information system, and its foreign engineers arrived in Taiwan last year, Chien said, adding that so far its work has gone smoothly.
Among the 80 people the bank has hired, 40 percent are focused on information technology and information security, and 30 percent on risk management and product design, he said.
Line Bank declined to comment, saying that it might give an update next week.
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