Gyeonggi-do Disaster Basic Income Boosts Consumption... "Franchise Sales Increased by 24%"

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[Asia Economy Reporter Ki Ha-young] It has been analyzed that the disaster basic income payment by Gyeonggi Province in response to the novel coronavirus infection (COVID-19) is showing an effect of stimulating consumption.

On the 6th, Shinhan Card analyzed the weekly consumption trends from March to April this year based on its credit card data related to Gyeonggi Province disaster basic income support funds. Compared to 100% sales at Gyeonggi Province merchants in the first week of March (1st?7th), sales were 108% in the first week of April (1st?7th) and 107% in the second week (8th?14th), which then expanded to 122% in the third week (15th?21st) and 124% in the fourth week (22nd?28th).

Shinhan Card stated, "It can be interpreted that the use of disaster basic income significantly increased from the third week," and "Considering the cumulative consumption rate of 41.6% as of the 28th of last month, the consumption stimulation effect is expected to continue for some time."

In particular, while merchant sales in Seoul and the six major metropolitan cities (Busan, Daegu, Gwangju, Daejeon, Incheon, Ulsan) increased by 17% in the fourth week of April compared to the first week of March, sales at merchants eligible for Gyeonggi disaster basic income support increased by 24% during the same period. This indicates a clear sales support effect on small and medium-sized merchants in Gyeonggi Province.

By industry, compared to the first week of March, the clothing sector showed the largest sales increase at 214% in the fourth week of April. Sales in local hub consumption sectors such as children/childcare and small retail stores also showed remarkable growth, increasing by 141% and 125% respectively compared to the first week of March. During the same period, sales in dining out, beauty, and academy sectors also rose by 141%, 148%, and 128% respectively compared to the first week of March, showing that disaster relief funds were effective even in face-to-face service industries.

A representative from Shinhan Card’s Customer Insight Team said, "We were able to confirm that the Gyeonggi Province disaster basic income support fund is playing a role as a catalyst in stimulating sales at small and medium-sized merchants," and added, "From this perspective, the nationwide emergency disaster relief fund to be implemented in the future is expected to have an even greater effect on stimulating consumption."

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