Seoul, South Korea - Toss Bank, a South Korean digital-dedicated bank, announced the launch of its commission-free foreign exchange service on Thursday.
The new service allows customers to exchange 17 currencies, including USD, JPY, and EUR, with no commission.
The service allows for real-time currency exchange through Toss Bank accounts. The monthly transaction limit is $300,000.
Traditionally, domestic financial companies have charged commissions for foreign exchange services.
Rates vary from 1.5% to 13% at local banks. Toss Bank aims to provide an alternative model.
The initiative allows customers to buy and sell foreign currencies at the same exchange rate.
This is in contrast to traditional banking practices, which involve additional fees.
Toss Bank's debit card also facilitates overseas payments and withdrawals.
According to the CEO of Toss Bank's foreign exchange product, the bank aims to "remove barriers between the Korean won and foreign currencies.
The CEO emphasized that Toss Bank's profit structure supports this commission-free offering.
Toss Bank reported its first quarterly profit last year, indicating a positive financial trend.
To facilitate money flow across borders, the bank plans to eventually introduce currency conversion services for individuals and businesses.
According to industry observers, the move could challenge standard fee-based FX models and lead to broader market shifts.
Toss Bank also aims to empower consumers interested in currency exchange by eliminating commission fees.