April 25, 2024

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[THE INVESTOR]  A major convenience store chain said on April 23 that credit card use surpassed cash use at its outlets last year, indicating that Koreans are increasingly turning to non-cash methods of payment.

According to convenience store chain CU, credit cards were used to pay for 55.1 percent of transactions last year, surpassing cash use for the first time.

CU said that credit card use rose to 57.3 percent of all transactions in the first quarter of this year as well, with the number likely to break 60 percent by the end of the year.

Convenience stores have traditionally handled more cash than other businesses because the amounts are generally small, under 10,000 won ($8.80). According to numbers from the Bank of Korea last year, 60.2 percent of all transactions at convenience stores were made with cash.

As fewer people use cash for everyday payments, the Bank of Korea is pursuing a project to reduce the use of coins altogether to reduce inconvenience and management costs.

Starting this month, the bank teamed up with convenience store chains and supermarkets in a pilot project that allows customers to receive change electronically rather than in cash.

The change is stored onto an electronic card that can be used to make other payments or refunded back into cash. 

By Won Ho-jung/The Korea Herald (hjwon@heraldcorp.com)