Payments Trends in South Korea: Out with the Old, In with the New
In recent years, South Korea has seen the ascendance of new methods that are redefining its payments market. In 2009, a record-breaking 53.4% of private consumption was paid for with a card of some type.
In a new report, Payments Trends in South Korea: Out with the Old, In with the New, Celent provides a detailed analysis of the newest trends and future developments in the nation’s payments market. Paying for goods and services with cards is a practice that has largely permeated South Korean society as well as consumer buying patterns. The use of cards has been encouraged by preferential measures and government and bank policies.
A Celent series of interviews with South Korean consumers found that the majority of participants used a credit card. The next most popular means of payment was the “check card,” a new type of debit card that is unique to South Korea. A significant portion of consumers responded that they actively use cards because they offer benefits such as reward points or special discounts.
Source: Celent consumer survey
“In the South Korean payments market, growth is anticipated in the debit card, mobile banking, and contactless payment sectors,” says KyongSun Kong, Analyst with Celent’s Asian Financial Services Group and coauthor of the report. “The industry also harbors high expectations for the future of incipient business models and, as such, the change that is afoot in the payments market warrants a closer look.”
In this report, Celent presents findings that highlight the burgeoning growth of electronic forms of payment and the factors fueling this growth, including direct efforts by the central government to promote the electronic payments industry. The report analyzes distinguishing characteristics of the market and the conditions of and prospects for multiple payment methods, with a special emphasis on areas in which solid growth is expected moving forward.