meta_id 3064742

On April 15, 2026, South Korea's Financial Services Commission (FSC) approved improvements to the procedures for designating and modifying innovation finance services utilising generative artificial intelligence (AI). The streamlined process simplifies approval requirements for minor generative AI model changes, enabling financial institutions to launch updated services more rapidly. Previously, financial companies operating generative AI services through innovation finance service designations—which provide network isolation exceptions—were required to complete full redesignation procedures even for simple model upgrades. To date, 169 innovation finance services have been designated, with 45 services launched. The FSC identified that this requirement created delays in service deployment and responded by introducing a tiered classification system based on security risk assessment. Under the new framework, financial institutions submit a written confirmation document to the Korea Fintech Support Center (sandbox@fintech.or.kr, 02-6375-1525) assessing the security impact of proposed generative AI model changes. The Financial Security Institute (FSI) reviews submissions and classifies changes into three categories: minor (no security system changes and minimal output variation); moderate (no system changes but significant output changes, requiring FSI security evaluation); and substantial (system configuration changes triggering existing redesignation procedures). Minor changes permit immediate service launch; moderate changes require institution-prepared security measures and FSI evaluation before launch; substantial changes follow standard redesignation procedures. The FSC and Financial Supervisory Service plan to identify additional network isolation improvements and coordinate closely with the financial sector to implement changes addressing the rapidly evolving information technology environment. REFERENCES: Financial Services Commission Press Release, April 15, 2026