'Zero Pay' Surpasses 500 Billion Won... The Power of 'Donghaeng Sale'

Cumulative Payment Amount of 501.75 Billion KRW as of the 1st of This Month
'Restaurants' Account for the Largest Share of Payments at 22.7%
Number of Franchise Stores Reaches 569,000, a 75.6% Increase from Last Year-End

Image source= Korea Simple Payment Promotion Agency website

[Asia Economy Reporter Kim Daeseop] The payment amount of the mobile simple payment system 'Zero Pay,' designed to support small business owners, has surpassed 500 billion KRW. As of the end of last month, the number of Zero Pay affiliated stores reached a total of 569,000, marking a 75.6% increase from 324,000 at the end of last year.

According to the Ministry of SMEs and Startups on the 2nd, the cumulative payment amount of Zero Pay recorded 501.75 billion KRW as of the 1st of this month. By industry of affiliated stores as of the end of last month, 'restaurants' accounted for the largest payment amount at 112.6 billion KRW (22.7%). This was followed by 'convenience stores and marts' with 104.1 billion KRW (21.0%), 'living and education' with 72.11 billion KRW (14.5%), and 'furniture and interior' with 35.1 billion KRW (7.1%).

Since the service officially started in January last year, Zero Pay has seen a significant increase in both payment amount and the number of affiliated stores within a year and a half.

In particular, this year, the increase in non-face-to-face (untact) consumption due to the spread of COVID-19 and the Korea Together Sale event have greatly contributed to the performance growth. While the total payment amount of Zero Pay was 76.8 billion KRW throughout 2019, since April this year, payments have exceeded 100 billion KRW every month.

As of the end of last month, by industry, restaurants accounted for the largest number of affiliated stores at 140,000 (24.6%). This was followed by 'living and education' with 106,000 (18.6%), 'convenience stores and marts' with 74,000 (13.0%), 'others' with 54,000 (9.6%), and 'clothing and accessories' with 46,000 (8.1%). By scale, among the total 569,000 affiliated stores, small business stores accounted for 540,000 (95.1%). Especially, stores with annual sales of 800 million KRW or less accounted for 520,000 (91.9%).

Zero Pay is a system created by the Ministry of SMEs and Startups and the Korea Simple Payment Promotion Agency to reduce the payment fee burden on small business owners. Businesses with fewer than five regular employees and annual sales of 800 million KRW or less have a 0% payment fee rate. As of last month, looking at payment performance by store size, 72.5% of the total payment amount was used at small business affiliated stores. Among these, 64.6% of payments were made at stores with annual sales of 800 million KRW or less.

Mobile gift certificates (Onnuri Gift Certificates, 43 types of local love gift certificates) using Zero Pay are also being issued. By industry of affiliated stores, the proportion of mobile gift certificate payments was highest in 'convenience stores and marts' at 22.4%, followed by 'living and education' at 17.0%, and 'restaurants' at 14.9%.

This year, in connection with the Korea Together Sale (June 26 to July 12), a payback event is underway where customers receive 5% cashback on payments of 5,000 KRW or more (excluding local love gift certificates) made through Zero Pay. From June 26 to July 1, Zero Pay payments amounted to 24 billion KRW.

Kwon Daesu, Director of Small Business Policy at the Ministry of SMEs and Startups, said, "It is even more meaningful to surpass 500 billion KRW during the Korea Together Sale period supporting traditional markets and small business owners," and emphasized, "We will provide policy support to ensure that Zero Pay becomes a payment method that helps improve the management conditions of small business owners."

Yoon Wansu, Director of the Korea Simple Payment Promotion Agency, said, "Zero Pay is gradually establishing itself as a payment infrastructure in our daily lives," and added, "Its scalability is limitless, not only for simple payments but also in connection with local love gift certificates and disaster relief funds."

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