KakaoBank to launch AI mortgage service

Korea’s largest internet-only lender KakaoBank will launch a mobile mortgage loan service powered by an artificial intelligence-based chatbot this month, allowing for a user-friendly and convenient loan application process, the firm said Tuesday.

“Most of the mobile mortgage loans in the country require customers to swipe left and right on a phone screen to go through a complicated process of loan application. But KakaoBank’s mortgage loan service provides much more seamless customer experience,” said KakaoBank CEO Yun Ho-young during an online press conference.

When a lender enters the chatting room, the chatbot asks for the address of the apartment the lender is looking to purchase and other information such as marital status and yearly income, said Baek Hee-jung, co-leader of KakaoBank’s mortgage loan team.

In just three minutes, the chatbot informs customers of the expected interest rates and the maximum amount they can borrow, depending on the loan’s expiration period that ranges from five to 35 years, Baek added.

“A lender can finalize the loan application by simply typing in the self-identification code and uploading a photo copy of a sales contract,” Baek said. “KakaoBank automatically submits related documents such as copies of resident registration and family relation certificate. There is no need to visit banks and prepare for complicated paper works.”

KakaoBank stressed that it has improved their system and infrastructure to manage the mobile loan process.

“We had some unfortunate incidents last year when we weren’t able to handle the soaring demand from mobile ‘jeonse’ loans. In order to prevent similar problems, we’ve recruited twice as many retail banking experts than the optimal number of staff,” said Song Ho-gen, co-leader of KakaoBank’s mortgage loan team, referring to loans for two-year leases.

With advanced AI banking technology, KakaoBank plans to launch a mobile deposit and loan service for self-employed business owners by the end of this year as well.

Yun also said KakaoBank is seeking to enter the global market, allowing other countries to benchmark its innovative banking system.

Scheduled to launch on Feb. 22, KakaoBank’s mobile mortgage loan service grants up to some 630 million won ($525,000) in loans with the interest rate ranging from 2.99 percent to 3.93 percent.

By Byun Hye-jin (hyejin2@heraldcorp.com)