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 conducted at bank branches and similar locations will be reduced from one hour to 30 minutes. Financial supervisory authorities plan to streamline procedures such as consumer handwritten signatures and submission of documents, and to encourage financial institutions to provide concise, core explanations in order to significantly reduce cases of misselling.

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

On the 3rd, the Financial Supervisory Service announced a plan to rationalize and streamline the subscription process for investment-linked financial products. Beginning next year, each financial institution will implement simplified processes. The intention is to address the practice where sales staff provide only formal explanations to minimize legal liability, which leads to misselling, and to reduce consumer inconvenience. As a result, the goal is to decrease the time required to subscribe to investment products such as trusts and funds from around one hour to approximately 30 to 40 minutes.

First, duplicate or unnecessary documents will be consolidated, reducing the number of documents customers must fill out from about 17 types to about 10 types. Financial institutions will be required to categorize subscription documents into basic and supplementary documents. Only three essential documents required for contract execution will be designated as basic documents. The “Cooling-Off Period Confirmation” required for subscribing to high-risk financial investment products (those with a principal loss over 20%) will be included within the contract, and numerous documents intended to protect elderly customers will be combined into a single document.

If a customer provides a handwritten signature on the basic documents, they will not be required to do so on supplementary documents, reducing the number of handwritten signatures from approximately 17 to between 3 and 6. Additionally, the amount of additional written content required from customers will be cut from around 163 characters to around 51 by eliminating repetitive or unnecessary entries.

The Financial Supervisory Service will recommend that financial institutions eliminate documents that do not impact contract execution and will encourage the establishment of internal controls in which independent departments, such as the Consumer Protection Division, review the appropriateness of streamlined customer documents.

The investor information verification and risk profile analysis processes will also be improved for efficiency. Customers will be allowed to complete these steps remotely prior to visiting the branch, and when multiple products are being solicited or subscribed to at once, if the customer confirms that their investment profile is the same for each product, the verification process will only need to be conducted once.

In addition, the Financial Supervisory Service will distribute a "Guideline for Explaining Investment Products" to financial companies in the second half of the year. This guideline will instruct institutions to focus mainly on essential information, such as product loss structures and investment risks, and to use visual aids to make the explanations more accessible.

An official from the Financial Supervisory Service stated, "We plan to accelerate follow-up measures by reviewing the implementation plans of each financial institution," adding, "We will continue to identify additional improvements, including verifying actual subscription times together with major distributors after the changes are implemented."

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