South Korea Payments Market Size (2024 - 2029)

The South Korean payments market is experiencing significant growth, driven by the increasing adoption of mobile payment applications and a shift towards cashless transactions. The expansion of online retailing and high internet penetration are further propelling this trend. The market's capacity is bolstered by the rising use of credit cards for online purchases and the growing number of inbound tourists, which stimulates local spending. Despite challenges in cross-border digital payments due to cost and complexity, the overall market size is expected to continue its upward trajectory, supported by technological advancements and changing consumer behaviors.

Market Size of South Korea Payments Industry

South Korea Payments Market Size
Study Period 2019 - 2029
Base Year For Estimation 2023
Forecast Data Period 2024 - 2029
Historical Data Period 2019 - 2022
CAGR 8.14 %
Market Concentration Low

Major Players

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*Disclaimer: Major Players sorted in no particular order

South Korea Payments Market Analysis

The South Korean payments market is expected to witness a CAGR of 8.14% over the forecast period (2022 - 2027). The payment services worldwide are rapidly moving towards adopting mobile payment applications, such as Samsung Pay, Mastercard, Apple Pay, and American Express, to accept and transfer payments, and South Korea is no way behind. With increasing internet penetration and rapid growth in online retailing, this trend is expected to continue over the forecast period.

  • According to Statistics Korea, In the year 2021, online shoppers in South Korea spent KRW 25 on food and beverages, whereas the spending on home electric appliances, electronics and telecommunication equipment was KRW 22 trillion, followed by the amount spend on clothing is KRW 16 trillion. Further, according to ministry of science and ICT (South Korea) poll done in South Korea in 2021, almost 74.5% of the participants said they have used their credit card to make an internet purchase. The same survey found that customers spent roughly 170,000 South Korean won each month on online purchasing. Such expenditure on online purchases will create a opportunity for the studied market to grow.
  • In South Korea, more people are going cashless for both online and offline payments. According to the bank of Korea, only about 20 % of all payments in the country are made with cash which is among the world's lowest to leverage this growing opportunity, tech firms, credit card companies, and the government launched varied mobile payment services. As a result, the Electronic payments in South Korea increased 32.7 percent on-year in 2020, hitting a record high of KRW 705.5 billion (USD 624 million), in terms of average daily transactions, amid the COVID-19 pandemic.
  • According to Korea Tourism Organization, In 2021, South Korea received approximately 967 thousand inbound visitors. Visitor arrivals in South Korea have shown an overall growth since year 2000. Such huge inbound of the tourist tourists in the region will drive the payment market, due to the spending on local goods purchase in local market by visitors either by cash or e-payment.
  • Moreover, the Covid-19 pandemic has reinforced major shifts in payment behavior by declining the usage of cash payments, switching from in-store to online payment methods, and adopting instant payments. These transitions have created new opportunities for payment players in South Korea.
  • The increase in international trade, internationalization of production, and cross-border e-commerce suggest that demand for digital cross-border payments will continue to grow globally. However, digital payments from one country to another might prove to be costlier, slower, and less transparent than domestic payments due to the complexity involved in the procedure. This might hinder the growth in the adoption of digital payments for cross-border transactions amongst the enterprises in the region, especially small and medium-sized businesses.

South Korea Payments Industry Segmentation

Payment is the transfer of money and goods in exchange for goods and services that the involved parties agree upon. Payment can be made in the form of services exchanged, cash, wire transfer, cheque, credit card, and debit card.

The South Korean Payments Market is Segmented by Mode of Payment (Point of Sale (Card Payments, Digital Wallet, Cash), Online Sale (Card Payments, Digital Wallet)), and by End-user Industries (Retail, Entertainment, Healthcare, Hospitality).

By Mode of Payment
Point of Sale
Card Payments (includes Debit Cards, Credit Cards, Bank Financing Prepaid Cards)
Digital Wallet (includes Mobile Wallets)
Cash
Others
Online Sale
Card Payments (includes Debit Cards, Credit Cards, Bank Financing Prepaid Cards)
Digital Wallet (includes Mobile Wallets)
Others (includes Cash on Delivery, Bank Transfer, and Buy Now, Pay Later)
By End-user Industry
Retail
Entertainment
Healthcare
Hospitality
Other End-user Industries
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South Korea Payments Market Size Summary

The South Korean payments market is experiencing significant growth, driven by the rapid adoption of digital payment solutions and a shift towards cashless transactions. The increasing penetration of the internet and the expansion of online retailing are key factors propelling this trend. Mobile payment applications like Samsung Pay, Mastercard, Apple Pay, and American Express are gaining popularity, facilitating both online and offline transactions. The COVID-19 pandemic has further accelerated this shift, as consumers increasingly prefer online shopping and instant payment methods over traditional cash transactions. This evolving consumer behavior is creating lucrative opportunities for payment service providers in the region.

The competitive landscape of the South Korean payments market is characterized by the presence of major players such as Samsung Group, NaverPay, Toss Payments Co., Ltd, and international companies like Amazon.com Inc., Apple Inc., and PayPal Inc. These companies are actively investing in partnerships, acquisitions, and product development to enhance their market share. The government's initiatives to boost digitalization, including the Korea Digital Development initiative and partnerships with IT firms like Cisco, are also contributing to the market's growth. Additionally, the introduction of digital wallets and the development of a central bank-backed digital currency are expected to further transform the payment ecosystem in South Korea.

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South Korea Payments Market Size - Table of Contents

  1. 1. MARKET INSIGHTS

    1. 1.1 Market Overview

    2. 1.2 Industry Stakeholder Analysis

    3. 1.3 Industry Attractiveness- Porter's Five Forces Analysis

      1. 1.3.1 Bargaining Power of Suppliers

      2. 1.3.2 Bargaining Power of Buyers/Consumers

      3. 1.3.3 Threat of New Entrants

      4. 1.3.4 Threat of Substitute Products

      5. 1.3.5 Intensity of Competitive Rivalry

    4. 1.4 Evolution of the payments landscape in the country

    5. 1.5 Key market trends pertaining to the growth of cashless transaction in the country

    6. 1.6 Impact of COVID-19 on the payments market in the country

  2. 2. MARKET SEGMENTATION

    1. 2.1 By Mode of Payment

      1. 2.1.1 Point of Sale

        1. 2.1.1.1 Card Payments (includes Debit Cards, Credit Cards, Bank Financing Prepaid Cards)

        2. 2.1.1.2 Digital Wallet (includes Mobile Wallets)

        3. 2.1.1.3 Cash

        4. 2.1.1.4 Others

      2. 2.1.2 Online Sale

        1. 2.1.2.1 Card Payments (includes Debit Cards, Credit Cards, Bank Financing Prepaid Cards)

        2. 2.1.2.2 Digital Wallet (includes Mobile Wallets)

        3. 2.1.2.3 Others (includes Cash on Delivery, Bank Transfer, and Buy Now, Pay Later)

    2. 2.2 By End-user Industry

      1. 2.2.1 Retail

      2. 2.2.2 Entertainment

      3. 2.2.3 Healthcare

      4. 2.2.4 Hospitality

      5. 2.2.5 Other End-user Industries

South Korea Payments Market Size FAQs

The South Korea Payments Market is projected to register a CAGR of 8.14% during the forecast period (2024-2029)

NAVER Corporation, Visa Inc., Samsung Pay., Toss Financial Services Private Limited and American Express Company are the major companies operating in the South Korea Payments Market.

South Korea Payments Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)