SEOUL — South Korea is taking another major step toward internationalizing the Korean won, introducing revised rules for foreign financial institutions that will allow more offshore won transactions and settlement outside the country.
The Ministry of Finance and Economy announced Wednesday that it had revised guidelines governing foreign financial institutions’ foreign-exchange operations and Korea’s foreign-exchange transaction regulations. The changes are part of Seoul’s broader effort to make the won more accessible and eventually move toward a more freely usable international currency.
At the center of the new framework is the Registered Foreign Institution for KRW Business, or RFI-K.
Under the revised rules, eligible foreign financial institutions registered with the Korean government can open won omnibus accounts at domestic foreign-exchange banks and settle won transactions through the Bank of Korea Won International Wire Network. This is designed to enable offshore won settlement without the previous restrictions tied to Korea’s domestic operating hours and location.
What changes under RFI-K?
Foreign financial institutions that want to conduct offshore won business must separately register with the Ministry of Finance and Economy as an RFI-K.
Once registered, these institutions can provide won-related services to nonresident clients, including:
- Won-denominated accounts
- Remittances
- Investments
- Lending and borrowing
- Offshore won payments and settlement
The institutions will also have compliance responsibilities. They must verify that their customers qualify as foreign nonresidents and submit monthly transaction reports to the Bank of Korea. Korean authorities will continue to review participating institutions’ financial soundness and monitor their transactions.
Part of a much bigger won-internationalization plan
The RFI-K changes do not stand alone.
In July, Seoul unveiled a broader Won Internationalization Roadmap aimed at making the currency easier for foreigners to use outside South Korea. The plan includes an offshore won settlement system that would allow foreign investors to conduct won transactions through registered overseas financial institutions without maintaining a separate won account at a Korean bank.
The government has also been moving toward a 24-hour foreign-exchange market, with the expanded trading system beginning in July 2026. The roadmap envisions offshore won transactions becoming accessible across different time zones rather than being tied primarily to Korea’s domestic market hours.
The Bank of Korea has already maintained a register of foreign institutions participating in Korea’s foreign-exchange market, with major international banks and financial institutions among those listed.
Why the move matters
For international businesses and investors, the reforms could reduce some of the friction involved in obtaining, holding and transferring Korean won across borders.
South Korea is one of Asia’s major trading economies, but the won has historically operated under more restrictive foreign-exchange arrangements than some major international currencies. Seoul’s current reforms are intended to make the currency and financial markets more accessible to global participants while maintaining regulatory oversight.
The government’s roadmap therefore represents a broader shift: rather than requiring foreign participants to conduct won-related activities primarily through accounts and institutions inside Korea, Seoul is building infrastructure that allows more won activity to take place offshore.
The road ahead
The latest RFI-K guidelines provide a regulatory framework for that transition, but they do not mean the won has suddenly become a fully freely convertible global currency.
Participating institutions remain subject to registration, customer-status verification, reporting and government oversight. The reforms are instead part of a gradual process to expand the won’s international use while strengthening Korea’s foreign-exchange infrastructure.
With offshore settlement, expanded trading hours and new rules for foreign financial institutions now moving forward, South Korea is reshaping how the won can move across borders — and the next phase could determine how deeply the currency enters global financial markets.
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