This study examines the results of competition promotion in the banking industry due to the introduction of internet-only banks through empirical analysis. It discusses the direction that internet-only banks should pursue to improve consumer welfare in the future through overseas case studies.

The empirical analysis can be divided into two parts. First, this study examines whether the introduction of internet-only banks improved the inclusiveness of the credit loan market in the banking sector. To this end, we determine whether borrowers who were previously unable to receive credit loans from the banking sector increase the probability of successful lending to the banking sector after internet-only banks are introduced. Next, we examine whether the introduction of internet-only banks increased competition in the banking sector’s credit loan market and decreased the interest rate corresponding to the price of loan products.

The above two analyzes find that the introduction of the internet-only bank significantly improved the tolerance of the banking sector loan market, and at the same time, contributed to the drop in interest rates in the banking sector loan market. However, these benefits also tend to be biased towards borrowers with high credit ratings.

The analysis results provide two policy implications.

First, as the purpose of the introduction, internet-only banks need to expand the information combination system to use unstructured information to enhance credit evaluation capabilities. With the recent passage of the Data 3 Act, the legal and institutional framework for using unstructured information in credit evaluation has been laid and as such, the effectiveness of this new system should be bolstered. Next, it is essential that incentives are introduced to induce internet-only banks to focus on the credit loan market rather than the already saturated mortgage market.

Preface
Executive Summary

Chapter 1 Introduction

Chapter 2 Introduction of Internet-Only Banks and Literature Review
　Section 1 Process of Introducing Internet-Only Banks
　Section 2 Review of Previous Studies

Chapter 3 Basic Data Analysis of the Bank Credit Loan Market
　Section 1 General Overview of the Bank Loan Market
　Section 2 Changes in the Credit Loan Market Before and After the Introduction of Internet-Only Banks

Chapter 4 Research Hypotheses and Empirical Analysis Methods
　Section 1 Introduction of Research Problems
　Section 2 Introduction of Econometric Models
　Section 3 Data Overview and Basic Statistics

Chapter 5 Empirical Analysis Results and Interpretation
　Section 1 Increased Financial Inclusion Due to the Introduction of Internet-Only Banks
　Section 2 Impact of Internet-Only Banks on Bank Credit Loan Products
　Section 3 Summary and Conclusion

Chapter 6 Evaluation of Internet-Only Bank Operations and Policy Recommendations
　Section 1 Recent Business Performance of Internet-Only Banks
　Section 2 Evaluation of Mid-Interest Rate Loan Performance
　Section 3 Assessment of Innovation in Internet-Only Banks
　Section 4 Policy Recommendations

Chapter 7 Conclusion

References
Appendix
ABSTRACT