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Personal information encryption mandate aims to unburden foreign investors, boost market activity

Published: 05 May. 2026, 16:51 Updated: 05 May. 2026, 18:39

A screen in Woori Bank's trading room in Jung District, central Seoul, shows the Kospi opening on May 4. [NEWS1]

With the Kospi index approaching the 7,000 mark, financial authorities have decided to encrypt sensitive personal information in transaction records of omnibus accounts used by foreign investors trading domestic stocks in a move aimed at boosting activity in the local equity market.

Authorities revised guidelines on foreign investors’ omnibus accounts on Thursday, according to financial industry sources on Tuesday.

The key change is the use of encrypted investor identification numbers in place of personal details, such as names and passport numbers, in transaction records of end investors.

Introduced in 2017, the omnibus account system allows foreign investors to trade Korean stocks through accounts held at overseas brokerages or asset management firms. Under the system, a foreign brokerage opens a single omnibus account with a domestic securities firm and executes aggregated orders on behalf of local clients.

While the system eliminates the need for foreign investors to open individual accounts in Korea, it also comes with regulatory requirements, including quarterly reporting of end-investor transaction details to the Financial Supervisory Service (FSS).

Concerns have been raised that such disclosures involving personal information place a burden on foreign investors, pushing authorities to make improvements.

The headquarters of the Financial Supervisory Service in Yeouido, western Seoul, on Aug. 15, 2022 [NEWS1]

“Many foreign investors feel burdened by the possibility that certain personal information could be exposed to authorities in the country where they invest, and this measure is intended to address those concerns,” a financial authority official said.

An exception, however, will apply in cases where suspicious trading activity is detected. If issues arise in transactions using encrypted investor identification numbers, authorities may request disclosure of names and passport identification numbers.

With FSS data showing that foreign investors hold 1.576 quadrillion won ($1.07 trillion) worth of listed Korean shares as of the end of March, industry observers expect the changes to improve foreign investors’ access to the Korean stock market.

“We will review deregulatory measures to improve foreign investors’ access to the domestic stock market and manage it more efficiently,” a financial authority official said.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY KIM SEON-MI [[email protected]]