Taiwan's FinTech Development

30-Second Overview: On July 10, 2025, the parent company of Taiwan's largest local mobile payment service, "Koubei Pay" (Jiekou Pay), was sealed by the court, with less than a thousand dollars in deposits across five bank accounts. Nine years ago, when founder Hu Yijia returned to Taiwan from Wall Street, he said he wanted to make Taiwan's payments as convenient as China's. What happened in between? Taiwan's FinTech started with the 2015 policy white paper, went through the regulatory sandbox, the mobile payment war, three pure online banks accumulating losses of 9 billion, to the central bank's digital new dollar experiment—each step was a tightrope walk between "letting innovation run" and "preventing it from crashing."

The Wall Street Golden Boy Returns

In 2015, a young man in his early 30s returned to Taiwan from China and founded Koubei Pay (Jiekou Pay).

His name is Hu Yijia. He graduated from the Department of Applied Mathematics at National Chiao Tung University, holds a master's degree from Columbia University, and worked as a hedge fund analyst on Wall Street, earning an annual salary of over ten million New Taiwan Dollars. The media called him the "Wall Street Golden Boy." But it wasn't nostalgia that brought him back to Taiwan—he had spent a few years in Suzhou, China, and witnessed firsthand how Alipay and WeChat Pay changed the consumption habits of billions of people. He wanted to bring the same thing back to Taiwan. ¹

His family background is also impressive: his grandfather, Hu Xin, was an attendant guard to Chiang Kai-shek, and his father, Hu Dingwu, served as the chairman of Development Financial Holdings and the chairman of Taipei 101. Hu Yijia had access to financial circle connections from birth. ²

Koubei Pay obtained its electronic payment license in 2018 and officially launched, capturing market share with high rebates. By 2020, Koubei had become Taiwan's largest local mobile payment brand, with over 6 million users. Hu Yijia publicly challenged LINE Pay, stating his intention to list Koubei on the OTC market in 2024 and on the stock exchange in 2025. ³

Then things began to turn.

The Day 3.6 Billion Vanished

In 2023, Zhan Jingsheng, Chairman of Taishan Enterprise, acquired a 40% stake in Koubei FinTech for 3.6 billion. However, internal power struggles erupted within Taishan shortly after. After the new team took control of the board of directors, they filed a lawsuit against this transaction.

In July 2025, the court ruled the transaction invalid, and Koubei FinTech was ordered to return the 3.6 billion. During the execution of the seal, court personnel discovered something: the total deposits in Koubei FinTech's five bank accounts amounted to less than a thousand dollars. ⁴

On the day of the seal, nearly 300 employees were temporarily notified to work from home, and the office sign was removed. Hu Yijia was subsequently prosecuted by the prosecution office for special breach of trust, restricted from leaving the country, and at one point faced electronic ankle monitor surveillance. ⁵

📝 Curator's Note
Koubei Pay's user funds themselves are safe—according to the "Electronic Payment Institution Management Regulations," all stored value is held in trust accounts by entrusted banks, completely isolated from the parent company's finances. The Financial Supervisory Commission (FSC) repeatedly emphasized this point. However, the image of "accounts having less than a thousand dollars left" has severely damaged the foundation of trust in Taiwan's fintech startups.

This is not the first time Hu Yijia has clashed with regulatory authorities. As early as 2020, the FSC fined him 3 million for seven violations involving the "Tuo Bao" product—misleading investors and undermining corporate governance—and removed Hu from his position as a director of Koubei Investment Trust. His response at the time was to publicly publish articles attacking the FSC. ⁶

Koubei's story is a microcosm of Taiwan's ten-year FinTech journey: policies opened the door, but those who rushed too fast may not necessarily arrive safely.

A Law That Changed the Rules of the Game

Let's go back to 2015. That year, the FSC released the "FinTech Development Strategy White Paper," declaring that Taiwan would embrace FinTech. Two years later, the "FinTech Innovation and Experimentation Act" was passed by the Legislative Yuan—this is Asia's first special law, making Taiwan one of the few countries in the world with a legal framework for a "regulatory sandbox." ⁷

The logic of the sandbox is simple: You have an idea for financial innovation, but current regulations don't allow it? Apply to enter the sandbox, experiment within a limited scope, and if successful, the law will be amended to legalize you; if you fail, you won't be punished.

It sounds beautiful, but in execution, it is more conservative than imagined.

Joinvest is one of the few successful cases to graduate from the sandbox—this company created a bond group-buying platform, allowing retail investors to jointly purchase bonds that were previously only available to institutional investors. Entering the sandbox for experimentation in 2021, it received recognition from the FSC, which deemed it "innovative and helpful for financial inclusion," directly leading to the amendment of the "Securities Dealer Establishment Standards." ⁸

But the numbers on the other side are not so pleasant. Seven years after the sandbox was launched, the number of approved experimental cases is not large, and even fewer have truly "graduated" and driven regulatory amendments. Critics say that Taiwan's sandbox has too high a threshold, too slow an audit process, and too short an experimental period, becoming a system that "looks open but is actually conservative." ⁹

"Taiwan's regulatory sandbox is one of the most complete legal frameworks in the world, but the problem is not with the framework, but with the speed of execution."
——Chambers and Partners, Fintech 2025: Taiwan ⁹

The Mobile Payment War in Smartphones

In 2026 Taiwan, walking into any convenience store, pulling out a mobile phone for checkout has become more common than pulling out a wallet.

According to FSC statistics, by the end of 2025, the total number of electronic payment account users in Taiwan reached 34.45 million—on an island of 23 million people, this number means that most adults have at least one electronic payment account. The government's goal of "90% mobile payment penetration rate by 2025" has basically been met. ¹⁰

But "penetration" does not mean "unification." Taiwan's mobile payment market is a chaotic battle:

LINE Pay relies on LINE's social foundation to firmly hold the top spot, with over 8 million users. iPASS MONEY (One-Pass Ticketing) leveraged its electronic ticketing base to surge to the number one spot in user count. Before the controversy erupted, Koubei Pay still had over 6 million users. Add in All Pay, All Profit Pay, EasyGo Pay, Taiwan Pay, Apple Pay, Google Pay—consumers have an average of three or four payment apps on their phones, and store counters are covered with QR code stickers from different brands. ¹¹

💡 Did You Know
The fragmentation of Taiwan's mobile payments is partly due to convenience store systems taking sides: 7-ELEVEN promotes OPEN Wallet and icash Pay, while FamilyMart promotes All Profit Pay. The payment landscapes of these two major supermarket chains essentially determine which app is in the pockets of Taiwan's population.

This is completely different from the "Alipay + WeChat Pay" dual-monopoly pattern in China. Taiwan does not have a single dominant super app, but rather a blossoming of many flowers—or, to be more honest, a fragmentation among many factions. Consumers are made more convenient (can swipe phones everywhere), but integration efficiency is low, and everyone is burning money to grab market share.

Three Banks, 9 Billion in Tuition Fees

In 2021, Taiwan welcomed the year of pure online banks.

LINE Bank, Liuten Bank, and Future Bank opened successively. Their selling point is "no need to go to a bank"—online account opening, high-interest current accounts, 24-hour service, using technology to redesign the experience of traditional banks.

Four years later, the numbers on the balance sheet are cruel: the three accumulated losses exceeded 9 billion. ¹²

But the story of losses has different readings. LINE Bank's user count surged to 2.29 million, with a deposit-to-loan ratio of 85.93%. In December 2025, it achieved Taiwan's first-ever monthly pre-tax profit for a pure online bank—the amount was 11 million, not much, but the symbolic significance is huge. LINE Bank announced it aims to break 100 million in full-year profits in 2026, wiping out cumulative losses within three and a half years. ¹³

Future Bank has 550,000 users, Liuten Bank has 320,000 users. The scale gap is obvious, but they are also narrowing losses. Liuten is approaching the capital increase red line and is planning a new round of capital increases. ¹⁴

📝 Curator's Note
The dilemma of pure online banks is not unique to Taiwan. The challenge worldwide for challenger banks—such as Monzo in the UK and Nubank in Brazil—is that the early stages involve burning money for scale. The real question is: Taiwan's market only has 23 million people, and the density of traditional banks is among the highest in the world (more than one branch per square kilometer). Pure online banks must compete for the same group of people against 38 commercial banks. The 9 billion in tuition fees buys the opportunity to survive in this crowded market.

Digital Hakka Coin: The Central Bank's Caution

While central banks around the world are studying digital currencies (CBDC), Taiwan's central bank has taken a very Taiwanese path.

In 2025, the central bank collaborated with the Ministry of Digital Affairs and the Hakka Affairs Council to launch the "Digital Hakka Coin" experiment—not issuing a digital new dollar all at once, but first testing on a small scale in 11 counties/cities across Taiwan and 70 key development areas for Hakka culture. Users can consume using de-identified anonymous wallets, valid until June 30, 2026. ¹⁵

Central Bank Governor Yang Chin-lung has maintained a consistently cautious attitude. He stated that the central bank would hold multiple public hearings and forums in 2025 to widely collect opinions from all sectors, but regarding the formal issuance of a digital new dollar, there is "no specific timeline." ¹⁶

This rhythm of "test a small piece first, listen to opinions, then see" forms a sharp contrast with the large-scale advancement of China's digital yuan. Taiwan's central bank does not want to be a pioneer; it wants to be the follower who makes no mistakes.

An Island's Financial Experiment

Ten years have passed.

The vision depicted in the 2015 white paper—Taiwan becoming a hub for Asia-Pacific FinTech—has been realized to what extent? The answer is: partially, but in a way different from what was originally thought.

Mobile payments have indeed become widespread, but not through a single super app, but through a chaotic battle of dozens of brands. Pure online banks have indeed arrived, but the three combined have fewer than 3.2 million users, accounting for a negligible proportion of all bank accounts in Taiwan. The regulatory sandbox has indeed operated, but the graduation rate is so low that it raises questions about whether it is a springboard or a display case.

Koubei's 3.6 billion storm has made one thing clear: Taiwan's FinTech's greatest tension has never been a technical issue, but a trust issue. Too loose regulation breeds the next Koubei; too tight regulation suffocates innovation in the sandbox.

In December 2025, LINE Bank reported its first month of profit, an amount small enough to be ignored, but the entire industry was watching. Hu Yijia wears an electronic ankle monitor, while LINE Bank counts its first profit. On the same island, in the same industry, two completely different endings are happening simultaneously.

Further Reading:

• Semiconductor Industry — Another industry in Taiwan that started with policy support and ultimately changed the global landscape
• Startup Ecosystem — The full picture of Taiwan's startup circle, where Koubei Pay resides
• E-commerce and Digital Payment Ecosystem — The e-commerce infrastructure behind mobile payments
• Taiwan Stock Market and Capital Markets — From shouting brokers to sliding fingers for regular investments, the evolution of financial infrastructure and capital markets

References

1. SETN News <Not relying on dad! Wall Street golden boy crosses into tech industry, Hu Yijia creates mobile payment APP> — Background report on Hu Yijia's return to Taiwan from Wall Street to start a business, including Columbia University degree and hedge fund experience.↩
2. ETtoday <Prominent family background! Wealthy third-generation "academic genius" Hu Yijia abandons 20 million annual salary to create Koubei Pay> — Hu Yijia's family background: grandfather Hu Xin (Attendant Guard), father Hu Dingwu (Chairman of Development Financial Holdings, Chairman of Taipei 101).↩
3. Mirror Media <Koubei Pay declares war, Hu Yijia allies with Taishin to battle LINE> — Koubei Pay's market strategy to challenge LINE Pay and IPO planning.↩
4. China Times <The Vanishing 3.6 Billion—Almost Caused a "Loss for All" Chain Reaction> — In 2025, the 3.6 billion equity transaction between Taishan and Koubei FinTech was ruled invalid; when sealed, the five accounts had less than a thousand dollars in deposits.↩
5. ETtoday <Koubei's "Wall Street Golden Boy" becomes subject of electronic ankle monitor surveillance, 3.6 billion dispute sealed> — Details of Hu Yijia being prosecuted for special breach of trust, restricted from leaving the country, and subject to electronic ankle monitor surveillance.↩
6. Voice Tank <Koubei's Vanishing 3.6 Billion: From Chinese Payment Experience to "Startup Exceptionalism"> — Reviewing Koubei's history of violations and fines for the "Tuo Bao" product and the FSC's regulatory challenges.↩
7. ICLG, Fintech Laws and Regulations Report 2025: Taiwan — Taiwan's "FinTech Innovation and Experimentation Act" took effect in April 2018, becoming Asia's first FinTech special law.↩
8. Global Legal Insights, Fintech Laws and Regulations 2025: Taiwan — Joinvest's bond group-buying platform graduated from the sandbox and drove the amendment of the "Securities Dealer Establishment Standards."↩
9. Chambers and Partners, Fintech 2025: Taiwan — Trends and Developments — International legal community's evaluation of Taiwan's regulatory sandbox as having a "complete framework but insufficient execution speed."↩
10. National Development Council <Mobile Payment Penetration Rate Hits Record High, Moving Towards Digital National New Life> — Government set a goal of 90% mobile payment penetration rate by 2025; total electronic payment account users reached 34.45 million.↩
11. Storm.MG <Koubei Lost! What Taiwanese People Love Most in Electronic Payments is This "7.08 Million People Are Using It"> — Rankings of user counts for iPASS Ticketing, Koubei Pay, All Pay; monthly transaction volume 390 million.↩
12. Storm.MG <Taiwan's 3 Pure Online Banks "Accumulated Losses Exceed 9 Billion"! FSC Exposes Key Reasons for Losses> — As of the end of 2025, the three pure online banks accumulated losses of 907.2 million, including user counts and deposit-to-loan ratios for each.↩
13. PChome News <Pure Online Banks May Say Goodbye to Burning Money Period, LINE Bank Turns Profitable in Single Month with 0.11 Billion> — LINE Bank achieved its first monthly pre-tax profit of 11 million in December 2025, aiming for full-year profits exceeding 100 million in 2026.↩
14. China Times <Over 3 Million Accounts Opened but Still Accumulated Losses of 8.7 Billion... Pure Online Banks Struggle for Profit, This One Named as Fastest to Turn Around> — Current status of user counts and capital increase plans for the three pure online banks; LINE Bank is named as the fastest to turn around.↩
15. BlockTempo <2025 Annual > — Central Bank and Hakka Affairs Council launched the "Digital Hakka Coin" experiment, covering 11 counties/cities and 70 key Hakka cultural areas, valid until June 2026.↩
16. XREX <"Digital New Dollar" is Coming! Central Bank Launches CBDC Prototype Platform> — Central Bank Governor Yang Chin-lung stated that public hearings would be held to widely collect opinions, but formal issuance has "no specific timeline."↩