"Disaster Relief Fund Had an Effect"... Card Usage Increased Two Months After May

May Individual Credit Card Approval Amount Increases by 2.3%
Disaster Relief Fund Effects Expected to Expand from June

[Asia Economy Reporter Ki Ha-young] Personal credit card spending, which had recorded negative growth for two months due to the impact of the novel coronavirus infection (COVID-19), has slightly rebounded. It is analyzed that the consumption contraction caused by COVID-19 has entered a recovery phase due to the effect of disaster relief funds being distributed into the market.

According to the card industry on the 10th, the personal credit card approval amount of eight full-service card companies (Shinhan, Samsung, KB Kookmin, Hyundai, Lotte, Woori, Hana, BC Card) was 45.1355 trillion won, an increase of 2.3% compared to the previous year. The declining trend, which recorded -4.1% in March and -4.4% in April, has turned into an increasing trend.

Last month, offline approval amount was 35.1255 trillion won, down 2.0% compared to the previous year. However, it showed a recovery trend as the approval amount increased by more than 4 trillion won compared to March-April this year. The industry views this as the effect of disaster relief funds being distributed into the market.

According to the Ministry of the Interior and Safety, as of the 2nd, 64% of the emergency disaster relief funds paid by credit and check cards have already been used. Of the 9.5866 trillion won paid by credit and check cards, 6.1553 trillion won has been distributed into the market.

Online consumption also continued to grow last month. Last month, the online approval amount was 10.01 trillion won, an increase of 20.5% compared to the previous year. As non-face-to-face consumption increased due to the impact of COVID-19, online approval amounts have shown a growth rate close to 20% since March. Despite offline approval amounts sharply decreasing by 10.4% and 9.1% year-on-year in March and April respectively, online approval amounts increased by 22.3% and 15.6% respectively.

An industry official said, "Considering that the annual approval amount growth rate averages 5%, it is difficult to say that consumption has fully recovered to the pre-COVID state," but added, "It seems that personal credit card spending has entered a recovery phase as disaster relief funds have been distributed into the market."

This content was produced with the assistance of AI translation services.