The government is set to implement a system that swiftly blocks financial transactions under the name of deceased individuals upon receipt of a death notification. This measure aims to prevent financial incidents involving identity theft and to protect the assets of bereaved families.
On September 6, the Financial Services Commission, the Financial Supervisory Service, the Ministry of the Interior and Safety, and the Korea Credit Information Corporation announced that they will launch the 'Rapid Financial Transaction Blocking System for Deceased Individuals' on September 11, involving all financial institutions.
Previously, financial companies received death information from the Ministry of the Interior and Safety through the Korea Credit Information Corporation once a month, which could take up to two months for companies to confirm a death and restrict transactions. Additionally, only some banks utilized this system.
Under the new system, the Ministry of the Interior and Safety will provide death information to financial institutions daily instead of monthly. Financial companies will be able to block transactions under the deceased's name as soon as the death is confirmed.
The scope of application will also expand from banks to include all 4,890 financial companies, such as insurance, credit card, securities, savings banks, and mutual finance. Most financial transactions, except for unavoidable ones like deposits, will be halted once a person is confirmed deceased.
Bereaved families will not need to separately request transaction blocking from financial companies. The Korea Credit Information Corporation and financial companies will automatically proceed with the blocking process upon verifying the relevant information.
A management system will also be established to prevent the misuse of death information for other purposes. It will be prohibited to use or provide death information to third parties for non-transactional purposes, and transaction histories will be recorded and managed electronically. The Financial Supervisory Service plans to continuously monitor information management and internal control practices.
If bereaved families require urgent funds for medical or funeral expenses, they can utilize the banks' 'exception withdrawal' system.
The government stated, "We expect this will help protect citizens' assets and prevent fraudulent financial transactions," adding that it will work closely with the Korea Credit Information Corporation and financial companies to minimize inconvenience for bereaved families.
* This article has been translated by AI.
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