Growing adoptiong of QR payments is driving mobile wallet usage in the country.
Mobile wallet payments transactions in South Korea are sighted to reach $503.5b (KRW581.3t) by 2024, according to data and analytics company GlobalData.
Data from GlobalData’s Payment Instrument Analytics revealed that the country’s mobile wallet payments transaction value grew to $181.6b (KRW209.7t) in 2020—more than tenfold the amount just four years ago, or $10.4b (KRW12t) in 2016.
High smartphone and internet penetration, coupled with government’s push towards cashless transformation, have supported this growth, says Sowmya Kulkarni, banking and payments analyst at GlobalData.
“South Koreans are well-accustomed to mobile wallets, with the country ranking one amongst the top globally, in terms of per capita spending using mobile wallets,” Kulkarni added.
The pandemic has only further accelerated the adoption of mobile wallets in the country, as consumers are increasingly opting for payments through mobile wallets due to the fear of contracting virus through the usage of cash and cards.
Growing adoption of QR based payments by merchants is also driving mobile wallet usage in South Korea, Kulkarni added. This is a trend happening not just in South Korea but in Asia as a whole, supported by government, merchants, and mobile payment providers.
For instance, Seoul Metropolitan Government in collaboration with domestic banks offers Zero Pay, a QR based mobile payment solution for merchants. It enables small merchants with annual turnover below $0.69m (KRW800m) to accept mobile payment without any transaction fees.
“South Korea has a sophisticated and mature digital payments market. As cash usage continues to decline in the country, consumers will increasingly move towards mobile wallets for both online and in-store payments,” Kulkarni concluded.
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