Banking in Korea

Banking can be one of the most frustrating aspects of living in a foreign country.  While living in Seoul, South Korea I’ve ran into some terrible problems and had some great experiences.  Read on to find some do’s and don’ts about banking in South Korea and abroad.  Let me know in the comments how this compares to your experiences or if you have any questions!

Below I’ve highlight a few topics comparing 3 banks which I have had experience with but want to preface by saying that every branch is different.  You might get amazing service at the Gangnam location but then be treated like dirt farther north in Dongdaemun so don’t let one set of bad customer service get you down.  Its important to note that just like anywhere there are many banking options and each one provides advantages and disadvantages so pick your poison based on what you need to do.


International Transfers – In Korea (and possibly other countries) only 1 bank is authorized to send money to the US (and possibly other countries).  If you want to switch you will have to fill out an extra form which will revoke access from the previous bank, this is a simple extra step that the bank will tell you about.  Whenever you transfer internationally be aware of the currency exchange rate.  This is ALWAYS a factor and in most cases in addition to banking fees.  Your receiving bank often charges fees to accept an international transfer too.  Check with your bank at home for the most up to date information.

Kookmin Bank (KB) – At first I tried a wire transfer with KB, it arrived safely but took about a week and I was charged approximately $50 in fees between my US bank and KB.  To avoid these fees my US bank advised using an ACH transfer and gave me all of the information needed.  KB agreed to do it and then messed it up, tried to charge me roughly $100 to get my money back and another $50 to try and send it again.  I was able to sort it out but it was VERY difficult and took weeks of going back to the bank.  Full story here.  As a result of the mix up I did some digging with my Koren secretary and discovered that KB does not know how to use any form of transfer except a WIRE transfer.  My Korean secretary called the corporate office and confirmed that their policy is to use wire transfers.  If you are doing a lot of international transfers I recommend picking a different bank as this can get expensive.

Citi Bank – Citi Bank is amazing (AND FREE) for international transfers IF you are transferring to another Citi Bank.  The transfer was instantaneous and I was in and out of the bank within 30 minutes.  They even set up online banking which allows me to do this FREE international transfer from the comfort of my home.   There is a nominal fee associated with transferring to another bank but the teller said that it would still be fast and easy to do.  The currency exchange rates here were good but not the best I found.  If you are doing a very large sum of money it might be worth paying a small fee for a better exchange rate but otherwise I highly recommend Citi Bank.

Hana Bank – Hana Bank can do Wire transfers or ACH transfers.  They give a very good currency exchange rate and had excellent customer service.  There are fees that amount to about $40 between both banks and it took roughly 4 business days for my money to arrive in America.  I was very happy with the service but ultimately decided to use Citi Bank for all my International Transfers since I can transfer more frequently for free.


Setting up an account – When setting up a bank account bring your passport, ARC card, some cash, your first born and a Korean speaker.  Chances are you won’t need a Korean speaker but if your branch doesn’t have someone who speaks English things tend to take longer.  You’ll still be able to set up any account but it might take all afternoon.

Kookmin Bank (KB) – KB was my first bank by default.  It was near my first job and they insisted I pick KB so that paychecks could be directly deposited.  My biggest complaint here was customer service based in that they didn’t tell me which documents I needed.  Each time I walked in I picked a number and waited in line with the Koreans.  At first I brought my ARC and they said I needed my passport.  I went back the next day with my passport and they said I needed my ARC.  I had to ask for online & mobile banking but when I did they installed the app on my phone.  Unfortunately for both of us they appeared confused during the process.  KB’s mobile app also requires a security app which they installed.  I consider the difficulties here a result of a branch based language barriers and imagine that it would be a smoother process elsewhere.

Citi Bank – I set up Citi Bank solely to transfer money to America.  Other than me forgetting which documents were required this process went smoothly.  Citi Bank reminds you that they declare paychecks as income in America so don’t set up a direct deposit here!  Once I had all my documents I was in and out in under 20 minutes.  I had to ask for online banking but it was set up very smoothly.  They even installed the app for my phone.

Hana Bank – As my 3rd bank I had the best experience at Hana Bank.  They didn’t ask me to pick a number and wait but rather took me immediately to the front of the line and sat me with a highly English proficient teller.  This time I had all my documents with me and was in and out in 30 minutes.  The teller informed me of a handful of perks and asked if I wanted online & mobile banking.  By far my best experience but I believe this was branch based and a result of an English speaking teller.

As far as setting up a bank goes it seems like they all want your money and will help you out as best they can.  If they have someone who speaks your language it will be faster and the rest of your experience will be smoother too.


ATMs & other fees – In general Domestic ATMs are all the same in Korea.  The only difference I found between them was that KB gives some form of refunds (but I couldn’t figure out why).  If you know more about this please mention it in the comments!

KB Bank – KB bank does a good job of providing ATMs throughout Seoul.  KB ATM’s are prevalent but even when you can’t find one I was only charged an ATM withdrawal fee in convenience stores & subway stations.  All other bank ATM’s were free.  Transfers from a KB ATM are free but if you do it from an off bank ATM there is a nominal fee.  I also found that KB regularly gives $1-$3 refunds but I cannot tell what they are for since its all in Korean.  Each month I would get one or two and Korean coworkers would just translate it as refund or rebate.

Citi Bank – CITI locations are just as prevalent as KB.  I found the same fee situations but did not get any refunds.

Hana Bank – Hana ATM’s were just just as prevalent as KB.  I have found a few ATMs outside of convenience stores & subway stations that charge a nominal fee (less than $1) and haven’t gotten any random refunds.


Miscellaneous Perks – every bank offers incentives of various kinds.  Some banking cards are difficult to us online and others function exactly the same as American credit cards.

KB Bank – KB bank gives refunds sporadically but was very difficult to use online.  I even went back to the bank a few times and they told me they would update it to be a Visa/Mastercard as well but after 3 visits I just gave up.  The card works internationally at ATM’s but does not work at stores.

Citi Bank – There were no advertised perks other than free transfers from Citi to Citi banks.  I haven’t used the card enough to discover any other perks.  The card worked internationally at ATM’s but not in stores.

Hana Bank – Hana Bank was great for perks!  They told me I could use it as a credit card and it worked the first day.  I’ve used it to buy from Korean & American websites (www.priceline.com & www.gmarket.com)  The card was automatically connected with my Korean Airlines mileage program earning miles for every dollar spent.  If you bring your passport to the bank they can even set it up to be used as a T-Money card (subway/bus transit card)  Hana Bank by far has the best perks!  This card also worked like a charm at international ATM’s & stores in Vietnam & Japan.


In summary I would rank the 3 banks… drumroll please!

1) Hana Bank

2) Citi Bank

3) KB Bank

If you are transferring abroad as I am then I suggest having two banks.  Hana Bank for your everyday Korean Life and travel and simply use Citi Bank to send money home!

Is there anything I missed? Did you find a bank that I haven’t used to be even better?

 

Mr Mike

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