Introduction

KakaoBank is a big name in South Korea’s digital banking space. Since its launch in 2017, it has changed how banking works by offering a seamless mobile-only experience, onboarding over 25 million users, and achieving profitability at scale. But as more digital banks emerge and customer expectations evolve, KakaoBank is planning ahead.

KakaoBank is focusing on three main steps that represent the pillars of its next phase of growth:

1. A dedicated AI Lab to support AI deployments

2. A massive fifth data centre (Jukjeon) to ensure resilience and business continuity

3. The adoption of Denodo’s data virtualization platform to unify real-time insights and enable agile decision-making

These are not just tech upgrades; they form a powerful, integrated ecosystem that combines technology, infrastructure, and data to enable smarter, faster, and more scalable banking.

#1 AI lab

KakaoBank’s AI Lab, established inside Digital Realty’s high-performance ICN10 data centre in Seoul, is where the bank is executing its AI-first strategy. The lab is designed to handle high-density AI workloads and leverages Air-Assisted Liquid Cooling (AALC) for efficient performance and sustainability.

The Lab is focused on building next-generation AI models for:

1. AI-powered loan approvals that use alternative data and machine learning to assess credit risk faster and more accurately

2. Conversational AI interfaces that enhance self-service capabilities and deliver contextual responses

3. Fraud detection systems that adapt in real time to evolving threats

4. Operational automation that drives efficiencies in back-office workflows and regulatory processes

Business implications:

1. Revenue growth - AI-driven credit scoring reduces friction in lending, enabling KakaoBank to tap into underserved customer segments while minimizing risk, fueling loan volume growth.

2. Customer stickiness - Hyper-personalized insights and services increase engagement and cross-sell/up-sell opportunities, raising customer lifetime value.

3. Cost efficiency - Automation reduces manual intervention and human error, lowering the cost-to-income ratio while improving speed and accuracy across functions.

4. Market differentiation - By developing proprietary models in-house, KakaoBank creates a defensible moat that few competitors can replicate quickly.

The AI Lab is helping KakaoBank become more than just a digital bank—it’s becoming a smart, real-time financial service.

#2 Jukjeon data centre

To support its AI ambitions and expanding customer base, KakaoBank is building its fifth data centre, named the Jukjeon Data Centre. Spanning over 99,000 square meters, this facility is being designed as a second disaster recovery (DR) site, a move that reflects the growing need for always-on, high-availability banking services.

Key functions:

1. Acts as a failover site to ensure zero downtime in case of system failures

2. Hosts compute-intensive AI applications and real-time analytics engines

3. Provides storage and processing capacity to support scalable offerings, such as third-party loans, micro-investments, or insurance

Business implications:

1. Business continuity - Guarantees that mobile banking, fund transfers, and loan disbursals remain uninterrupted

2. Operational scalability - The data centre ensures the infrastructure is ready to scale dynamically with no performance bottlenecks.

3. Regulatory and investor confidence – Shows investors and regulators that the bank is serious about safety and planning

4. Lower downtime risk – Avoids lost transactions and dissatisfied customers, which come with system downtimes.

In short, the Jukjeon centre is like a safety net, keeping everything running smoothly while supporting future growth.

#3 Modernising data analytics

KakaoBank has also turned its attention to modernizing how it accesses and utilizes data across the organization. The bank entered into a partnership with Denodo Korea to implement data virtualization.

This lets KakaoBank combine customer info, app activity, loans, and more into one view that’s easy to use and quick to access.

What Denodo enables:

1. Access real-time data across internal and external systems without physically moving or duplicating it

2. Simplify data consumption using intuitive queries and APIs

3. Enable self-service BI for business users, accelerating decision-making

4. Improve data governance, as sensitive data stays within source systems while remaining accessible for compliant usage

Business implications:

1. Faster go-to-market - New product features, marketing campaigns, or credit strategies can be launched faster due to real-time access to unified data

2. Stronger risk management - Real-time credit monitoring and fraud detection become more agile and effective, reducing potential losses

3. Lower IT overhead-  Eliminates the need for redundant ETL pipelines or massive centralized data lakes, cutting infrastructure costs and complexity.

4. Democratized insights - Business teams can access insights without relying solely on data engineering, improving cross-functional agility and innovation

This is a big step from old ways of using data to real-time smart decision-making, helping AI work better across the bank.

Conclusion

These three steps show that KakaoBank is preparing for the future of banking.

It’s not just about using new tech—it’s about creating a smart and strong system that can:

1. Make more money by smarter lending and financial services

2. Spend less by using AI and better data tools

3. Keep users happy with fast, personalized services

4. Build trust with strong systems that meet rules and attract investors

In today’s world, where speed, smart tech, and reliability matter most, KakaoBank is not just keeping up—it’s leading the way. It’s turning into a real-time, AI-based bank ready to shape the future of banking in Korea and beyond.

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