As AI Hacking Threats Grow, Financial Security Institute's Budget to Top 100 Billion Won for First Time Next Year

Plans to raise next year's budget by 15% to around 110 billion won
Financial firms once reluctant to increase contributions now support a budget hike
Strengthening AI detection and defense; expanding security support for smaller firms

As artificial intelligence (AI)-based hacking threats targeting the financial sector intensify, the Financial Security Institute's budget for next year is expected to exceed 100 billion won for the first time. The institute, which has played a key role in identifying signs of breaches and preventing the spread of damage in a series of recent cyberattacks on financial companies, plans to increase investment in building AI-based detection and defense systems.

Yonhap News Agency

According to the financial sector on October 19, the Financial Security Institute's board of directors recently discussed a plan to set next year's budget at around 110 billion won, a 15% increase from this year's budget, to expand investment in AI security. This would exceed this year's budget growth rate of 10%.

The main focus of next year's budget increase is expanding investment in AI security. The institute plans to significantly increase its "AI budget," including costs to build systems for introducing AI into key areas of work, such as security inspections and monitoring, as well as fees for AI services. The institute's budget is funded through contributions from financial companies, including banks. Financial companies that have been reluctant to raise their contributions are reportedly now supportive of an increase, as a series of hacking incidents has heightened the need for security investment.

Recently, a succession of attacks in the financial sector has targeted external systems linked to financial companies, which are relatively vulnerable to security breaches. Notable examples include last month’s hacking incidents targeting “weak links” in financial services, such as Shinhan Bank’s system for loan agent access and the merchant network of electronic payment gateway (PG) provider Toss Payments. Concerns are growing that even if financial companies strengthen their internal security networks, a breach at an external point of contact could lead to a major incident, such as the leak of customer information. In particular, as concerns grow that AI agents may have been used to exploit security vulnerabilities in existing systems, automating attacks and making them faster, calls are mounting for an urgent shift in security response systems.

In response, the Financial Security Institute plans to accelerate the development of a proactive defense system under the principle that “AI must be countered with AI.” It will strengthen its detection and response capabilities by using AI to identify potential security vulnerabilities in advance and by monitoring systems in real time to detect abnormal activity early. The institute plans to fully launch its AI-based security system in January 2027, with the aim of establishing a prevention-focused security system that detects and blocks intrusion attempts early, rather than responding only after an incident occurs.

The scope of support is also expected to expand. The institute plans to extend security inspections and vulnerability remediation support beyond banks, securities firms, insurers, and credit card companies to include smaller financial companies, such as savings banks and general agencies (GAs) for corporate insurance. With financial systems closely interconnected, a security vulnerability at an individual financial company could pose a risk to the entire sector. The aim is therefore to strengthen defenses at relatively vulnerable institutions and raise the overall level of protection across the financial sector.

The institute will also continue to increase its security workforce. After hiring 15 people in 2025 and 30 in 2026, it plans to recruit around 20 more in 2027. However, rather than relying solely on workforce expansion, it is placing greater emphasis on boosting investment in AI technology to improve the efficiency of security responses.

As the Financial Security Institute's role as the financial sector's “common shield” grows, next year's budget proposal is scheduled to be finalized in December after completing the relevant procedures, including approval by member organizations and the board of directors.

Meanwhile, the recent spate of cyberattacks on the financial sector is expected to be a major topic at the National Assembly Political Affairs Committee's audit of the Financial Supervisory Service, scheduled for October 19. Financial Security Institute President Park Sangwon will attend as a reference witness, while the heads of the five major banks—KB Kookmin Bank President Lee Hwanju, Shinhan Bank President Jeong Sanghyeok, Hana Bank President Lee Hoseong, Woori Bank President Jeong Jinwan, and NH Nonghyup Bank President Kang Taeyoung—are also expected to testify and face intensive questioning about security investment and the state of their internal controls. With the bank presidents' terms set to expire around the end of the year, there is also speculation that their handling of the parliamentary audit could affect their future positions.

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