South Korea Tightens Prepaid Service Providers' Crypto Investment Rules

South Korea's Fair Trade Commission (FTC) has proposed revised consumer protection guidelines for prepaid installment transactions. The update, which will be finalized after a 20-day notice period ending September 14, emphasizes that companies managing customer prepayments must balance stability, liquidity, and profitability when handling those funds.

Under the new rules, any investment carrying a significant risk of principal loss would require prior internal review and approval. This includes virtual assets such as cryptocurrencies, derivatives, and leveraged financial products. Large companies holding at least 100 billion won (approximately $75 million) in customer prepayments would be required to establish and operate a prepayment management review committee.

The FTC's move aims to prevent scenarios where consumer prepayments are jeopardized by speculative investments. This marks another step in aligning prepaid installment practices with prudent risk management, particularly regarding high-risk investments. As the notice period unfolds, industry stakeholders will review the implications of these new rules.