The government is trying to build my data infrastructure, but business model construction is still ‘slow’

“We will spread My Data and improve system acceptance by increasing its utility”
‘Advertising’ is a business model?, ‘two sides’ of My Data, which is biased towards advertising
Even if the passage is opened, the reality is ‘zero’, “We must first lay the foundation for value proposition competition”
IBK Industrial Bank My Data Service/Photo = IBK Industrial Bank of Korea

The government has begun full-scale preparations by building technical and institutional infrastructure ahead of the implementation of My Data in 2025. This year, we plan to discover leading services that will allow citizens to experience the convenience of My Data and build a platform that comprehensively supports transmission requests. However, there are many critical opinions. It is pointed out that in a situation where a specific business model for the my data business is not in place, only pursuing indiscriminate expansion will not bring about changes in the ecosystem.

Personal Information Commission “Secure My Data Budget of 152 billion”

On the 4th, the Personal Information Protection Committee announced its plan to utilize the 152 billion won budget secured this year to implement the My Data system. My Data is a system that allows citizens to directly download personal information about themselves (download right) or send it to a desired location (right to request transmission to a third party). It allows citizens to manage and utilize their personal information according to their wishes. This is the key. With the revision of the Personal Information Protection Act last year, the right of data subjects to request transmission of personal information was introduced, providing a legal basis for expansion to all fields. However, it is still only implemented in some fields, such as finance and public affairs, according to individual laws. The Personal Information Commission plans to further promote the spread of My Data by preparing specific plans for discovering leading services, establishing transmission infrastructure, and establishing a My Data support platform.

First, the Personal Information Commission will provide 25 billion won to discover leading services. The goal of the leading service project is to support the government budget by matching a certain percentage to companies selected through public contest and screening. The government plans to increase the acceptability of the system by allowing citizens to experience the utility of My Data in resolving inconveniences such as existing cumbersome procedures through leading services. In addition, MyData is expected to contribute to the creation of new businesses for companies through the convergence of various data. 15 billion won will be invested to build transmission infrastructure. This project demonstrates detailed transmission technology standards and procedures between information providers (companies/institutions holding personal information), relay agencies, and information recipients. Through this, we plan to build an actual transmission system for various information providers, relay institutions, and information recipients by the second half of this year in accordance with verified transmission technology standards.

A ‘My Data Support Platform’ will also be established. The My Data support platform comprehensively supports citizens’ right to request transmission of personal information by allowing them to manage their transmission request status and history, and request suspension or destruction of transmission requests. For this project, which has secured 75 billion won, a business operator will be selected through a bidding notice from the Public Procurement Service within next month. The remaining budget will go to existing projects, such as data format and transmission standardization, which have been promoted since 2022. Through this process, the Personal Information Commission plans to first apply the MyData system to areas such as communications, distribution, and medical care next year and gradually expand it to all areas. To this end, we will sequentially prepare within this year subordinate laws and regulations of the Personal Information Protection Act (enforcement ordinance, notice, guidelines, etc.) that contain institutional and technical matters to be observed by information providers and recipients, such as transmission targets, transmission methods and procedures, and safety assurance measures. I also made a plan.

Downward arrow made of dollar coins and banknotes on white background - Concept of loss of money and downward trend of dollar currency
Photo = Adobe Stock

A business without a profit model? The ‘back side’ of My Data

However, there are many critical opinions from some quarters. Since there is no specific business model in place for the introduction of My Data in the first place, full introduction is premature. Currently, financial my data operators, despite processing finance-related information, strictly speaking do not belong to financial companies, and therefore do not operate financial products or engage in businesses that directly bring economic profits or losses to users. The essence of the financial my data business is to pursue new value or innovation with financial data, which is a by-product of financial transactions, but it is true that there is still a lack of discussion about what kind of business model can be built based on this.

The business model that my data operators are cultivating is ‘advertising.’ However, as the focus of the My Data business gradually begins to focus on product advertising, negative public opinion regarding it appears to be increasing. In relation to this, a financial expert raised his voice, saying, “Contrary to the purpose of introduction, Korea’s My Data service is focused only on product advertising,” and “In order to properly utilize the My Data service, we need to first secure platform neutrality.”

This is even more evident when compared to the case of the United Kingdom, which introduced My Data before Korea. In the UK, more than half of financial products are sold through neutral platforms. This means that it is relatively easy for my data operators to build a business model. Although it is legally possible to operate an advisory platform in Korea, no company has actually registered. This is because there are almost no avenues for profit. In response, a financial expert emphasized, “Even though the channel is open, it is not realistic, so the differentiation of domestic my data services has become weak,” and added, “We must first lay the foundation for my data operators to compete in value propositions.”

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