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‘Leading banks around the world trust us because our products are secure’

Cho Jung-il, the CEO of South Korean smart card pioneer company Kona I Co Ltd and the chairman of Kona Software Lab Ltd recently visited Bangladesh. Kona I is well known for providing complete solutions and platforms to the global fintech market. Since its founding in 1998, the company has developed and commercialized Korea’s first integrated subway card transportation system.

Since 2004, Kona I has supplied the IC Chips to the telecommunications industry, banking industry and governments using its Global Platform Standard KONA chip operating system, and is expanding its business areas to provide fintech, certification and security related platform solutions. Kona Software Lab Ltd has recently designed NexusPay for Dutch-Bangla Bank Limited, among other important products and fintech services.

Fintech spoke with Cho Jung-il during his visit in Dhaka.

FINTECH: I just want to start by asking you about your experience in the smart card and payment industry, what was it like before and how much it has changed for KONA?

When I founded my company in 1998, at that time magnetic stripe cards were the medium of payment transaction, at that time we used magnetic stripe cards which is not secured, so gradually I saw the evolution of secured devices. Secured device is the smart device which can ensure security. We invested to develop chip operating system on the smart card chip. Actually payment application needs to be secured. At that time I was doing business in Korea. I found that we need new payment scheme based on smart card. At that time we participated in EMV committee forum, we discussed about payment system and then I decided to start my own company. I developed the chip operating system on smart cards, even though the application was ready but nobody was interested in changing from magnetic stripe to chip card at that time. I developed some proprietary system based on smart card chip. Our system was very successful in the industry and then banks were moving from magnetic stripe to EMV.

FINTECH: How will disruptive technology like IoT and AI will impact KONA? Who will be your competitors?

I will not say “competing” rather I would like to say that we have our own payment platform which has been launched in Korea for quite sometimes now. We named our platform ‘KONA Card’. We are building our own platform which is not just a payment platform but also a marketing platform and more service can be added on. We are using AI in these service platforms to understand our customer’s behavior in a better way. We are also focusing on the IoT security and working on it. We have two R&D centers in Korea and now in Bangladesh. Some components have been developed by KONA in Korea and some components have been developed in Bangladesh.

FINTECH: Not many global companies set up R&D in Bangladesh. Why did you choose Bangladesh?

Actually I was looking for a good place to establish an R&D center. India, China, Belarus, Bangladesh – all these countries were candidates for me. When I had interviews with some people in Bangladesh, I thought that so many smart people live in Bangladesh. But at that time I thought there is no industry especially in fintech, so I tried to build this kind of industry here. So, when I decided at that time there were several companies in Bangladesh who were all outsourcing companies. They don’t do any research project by themselves. I didn’t want to do outsourcing, I wanted to do actual research, so at that time I decided to start R&D in payment industry.

FINTECH: What your interaction with the government has been like?

Normally government do not know the technology trend so we have to explain about our latest technology trend, so that they can have confidence to have the new technology to solve some national and social issues.

FINTECH: The DBBL system, NexusPay, is really comprehensive, a kind of one-stop thing, that’s how it is built. Do you think Bangladesh is ready for that kind of digital integration or disruption?

Yes, I think the comprehensive digital payment will be more popular in future in Bangladesh. We have all the components developed to introduce any kind of services in the digital payment platform.

FINTECH: Could you talk a little bit about why your smart card system has been so successful and also about some of your biggest clients globally?

Actually we have big market share in USA, most of the major banks in USA use KONA smart cards. Our product is secure to use. That’s why banks around the world can trust our product, so that’s why we are successful, and then also we have good technical support for our customers. We can solve most technical issues within 24 hours and also we do continuous innovation. For example, right now we have just finished pilot projects for biometric card. We don’t need any pin, we don’t need signatures; just your finger will be enough for a secure transaction.

FINTECH: What do you expect to happen for Kona I in the near future, say in the upcoming five years?

In the next five years platform business is very important not only for payment service, but also for integration of some new technology like blockchain, AI, big data, etc. So maybe all technologies will be integrated in the same platform. So, what is the key application on mobile platform? Maybe payments services platform or social network service. But payment service is very important. Everybody has to spend money every day, so that’s why this is the key issue.

FINTECH: Do you think that’s where eventually the whole global system is going kind of what we have seen with WeChat and things like that, everything is consolidated into one place?

WeChat comes from Social Networking Site (SNS), so many SNS services, so they are building their own platform, even though they started their business on the social network service. KONA is also promoting its own platform even though we started from payment services. So we are integrating many services into this platform, m-commerce and money transfer-we are researching on, we have plans to integrate blockchain.

FINTECH: How many employees do you have right now?

In Korea 500 people, here almost 80 people, in other 9 countries we have technical and sales support teams also.

FINTECH: Thank you for your Valuable Time.

Thank you for speaking to me.

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