Bank of Korea Launches 24-Hour Won Settlement Pilot for Overseas Investors

The Bank of Korea (BOK) has started testing round-the-clock settlement for Korean won transactions aimed at foreign investors, a move designed to remove constraints tied to domestic banking hours. Trial operations for the BOK Won International Wire Network began on Sept. 21, with full-scale rollout planned for January 2027. Four local banks are participating in the initial phase: KB Kookmin Bank, Woori Bank, Hana Bank and Shinhan Bank. Yonhap reported the test kicked off at 9 a.m. local time, operating until 9 a.m. on the next business day, while remaining closed on weekends and public holidays. Overseas banks are expected to come on board after the official launch. The pilot is part of South Korea's broader push to open its foreign exchange infrastructure to international institutions. The BOK's 2025 Payment and Settlement Systems Report said operating hours for BOKWire+ were set to be extended in March 2026 and pointed to additional work on BOKWire Int and adoption of ISO 20022 messaging standards, aimed at reducing cross-border settlement frictions and aligning infrastructure with expanded FX trading hours. South Korea's domestic FX market moved to 24-hour trading on July 6, according to the finance ministry. While the reform broadened trading access, settlement still required upgrades. The new network is intended to close that post-trade gap by enabling won settlement across global business hours. Regulatory groundwork for offshore won business was laid on Sept. 16, when the Ministry of Finance and Economy amended rules to create "Registered Foreign Institutions for KRW Business" (RFIKs). Under the framework, registered institutions can open omnibus accounts with domestic FX banks and settle won transactions via BOKWire Int. Eligibility is limited to foreign nonresidents, and RFIKs must verify customer status and report major transactions to authorities. The revised rules also allow unlimited won borrowing from domestic banks through overdrafts for settlement purposes, a measure the ministry said was aimed at reducing settlement risk. The amendments followed a public consultation held from Aug. 24 through Sept. 3 and a regulatory review completed by the Office for Government Policy Coordination. The structure enables foreign investors to transact through registered institutions outside South Korea, reducing reliance on accounts opened directly with Korean financial institutions. The ministry tied the changes to its July 19 Roadmap for KRW Internationalization, which targets broader overseas holding, trading and settlement of the currency. The offshore won settlement network itself does not use blockchain technology or a central bank digital currency. In parallel, the BOK has been exploring tokenized settlement through separate initiatives. The Bank for International Settlements said Project Agorá carried out real-value testing in July 2026, processing about 800,000 Swiss francs across 17 transaction scenarios using tokenized central bank reserves and commercial bank deposits. The won was included alongside five other currencies. The BIS said the project involved 28 financial institutions and central banks, with average settlement taking about 80 seconds. Separately, the BOK has developed Project Hangang around a wholesale central bank digital currency infrastructure. In its first phase, tokenized commercial bank deposits were tested on a unified ledger. The central bank said in March that a second live phase was planned for late 2026, following a review of lessons from the 2025 pilot. With rules already amended to support offshore won business, the government said registered institutions will operate under prudential oversight and transaction monitoring. The key milestone remains the January 2027 start of full offshore settlement operations, after which foreign banks are expected to join the network. Authorities said they will monitor transactions and compliance as offshore won activity expands through the RFIK framework.