From Next Year, Bank Investment Product Enrollment Time Halved to 30 Minutes...Only Key Points to Be Explained

Explaining Only the Essentials, Not Formalities
Handwritten Signatures Reduced from 17 to 3-6 Times
"Investment Product Explanation Guidelines" to Be Distributed

Starting next year, the explanation time for financial products provided at bank branches and similar locations will be reduced from one hour to 30 minutes. The financial supervisory authorities plan to simplify procedures, such as handwritten signatures and required documentation by consumers, and encourage financial institutions to offer concise explanations focused on key points to significantly reduce the risk of misselling.

A local bank branch in Seoul on the 30th. Photo by Jin-Hyung Kang aymsdream@

On September 3, the Financial Supervisory Service announced measures to rationalize and simplify the subscription procedures for investment-type financial products. The plan is for each financial institution to implement these simplification measures starting next year. The goal is to correct the practice of staff giving consumers perfunctory explanations mainly to avoid legal liability, which has contributed to misselling, and to reduce inconvenience for customers. Through these changes, the time required to enroll in investment-type products such as trusts and funds—currently about one hour per product—will be reduced to approximately 30 to 40 minutes.

First, redundant or unnecessary documents will be consolidated, reducing the number of documents customers need to complete from around 17 to approximately 10. Financial institutions will be required to categorize enrollment documents as basic and supplementary. Only three key documents essential for contract completion will be designated as basic documents. The ‘cooling-off period confirmation’ required for high-risk financial investment products (with principal losses exceeding 20%) will be included in the contract, and multiple documents for protecting elderly customers will be merged into a single document.

If a customer provides a handwritten signature on the basic documents, supplementary documents will no longer require their signature, which will significantly reduce the number of handwritten signatures from around 17 to about 3 to 6. Additionally, repetitive rewriting tasks will be eliminated, cutting the number of characters the customer must write from about 163 to approximately 51.

The Financial Supervisory Service will recommend that financial institutions abolish documents unrelated to contract completion, and will encourage them to establish internal control processes by having independent departments, such as the consumer protection division, review the appropriateness of the simplified documentation required from consumers.

The procedures for confirming investor information and analyzing investment preferences will also be streamlined. Customers will be allowed to complete pre-contract forms remotely before visiting branches, and if the customer confirms that their investment preferences apply equally to multiple products being considered or subscribed to simultaneously, information verification procedures for each product will only need to be completed once.

In addition, in the second half of the year, the Financial Supervisory Service plans to distribute “investment product explanation guidelines” to financial institutions, which will focus on visually conveying key information such as loss structures and investment risks in a clear and comprehensible manner.

An official at the Financial Supervisory Service said, “We will encourage the implementation of swift follow-up actions by checking the respective action plans of each financial institution," adding that “in consultation with major distributors, we will continue to identify additional areas for improvement, such as verifying the impact of these changes on actual subscription times.”

This content was produced with the assistance of AI translation services.