In South Korea, entities ranging from the tech companies behind Samsung Pay and Kakao Pay to the government and credit card companies are vying for dominance in mobile payments.
As more people start using mobile payment services, payments can be easily made offline and online via smartphones. Along with this trend, South Korea will gradually enter the era of no wallet.
According to the Yonhap News Agency, on May 29, in a convenience store in Yeongdeungpo-gu, Seoul, Seoul Mayor Park Won-soo (second from right) and the ruling party, the Democratic Party, Li Renrong (right), used the mobile payment service Zero Pay.
South Korea launched the “Zero Pay” mobile payment system on December 20, 2018. Compared with credit CARDS, Zero Pay can save fees for small and medium-sized merchants, whose fees are almost Zero.
Since the Seoul city government launched Zero Pay last October, 100,000 merchants have joined the system.
When consumers use the zero-payment system, they simply scan the QR code placed at the counter with their smartphone and input the settlement amount, which will be transferred from the consumer’s account to the merchant’s account.
The South Korean government will charge a fee to businesses that use the “Zero pay” system.
“Zero Pay” is open to restaurants, coffee shops, barbershops and pharmacies that have a lot to do with people’s lives. Vendors with annual sales of less than 800 million won will get free fees and other benefits.
To encourage more consumers to use the “0 payment” system, the South Korean government has pledged to reduce income tax by 40% for consumers who use the payment platform. This is a huge step forward compared to the 15% tax exemption rate for credit cards.
Unlike China’s WeChat payment and Alipay payments, South Korea’s “Zero pay” customers need to enter the phone’s banking software, find the relevant payment, and then shoot the QR code, so there are at least 3 more programs than China’s payment software, but also enter the password of the bank software.
Seoul Mayor Park Yuan-soo said that the zero-payment system has effectively reduced the burden on merchants. The original handling fee of hundreds of thousands of won or even several hundred won won will be greatly reduced. In the future, the government will continue to improve the system to attract more franchisees and consumers to use the zero payment system for settlement.