‘Suncheon Sarang Gift Certificate’ Plays a Vital Role in Local Economic Circulation

Record High Issuance, Sales, and Redemption of Suncheon Sarang Gift Certificates Last Year
Consumption of Essential Daily Items at Restaurants, Cafes, Gas Stations, etc.
Expanded Discounts and Disaster Relief Funds Drive Consumption Activation
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[Asia Economy Honam Reporting Headquarters Reporter Lee Hyung-kwon] Suncheon City (Mayor Heo Seok) has been issuing the local currency "Suncheon Sarang Gift Certificate" since 2018, which has been playing a significant virtuous cycle role in the local economy, such as increasing sales for small business owners and self-employed individuals.

On the 5th, Suncheon City announced that an analysis of last year's issuance and consumption status of the Suncheon Sarang Gift Certificate showed that with the government's expansion of support for local gift certificate issuance, disaster relief payments, and diversification of issuance types, the issuance and utilization of the Suncheon Sarang Gift Certificate increased, resulting in a positive ripple effect on the local economy.

▶ Last year's Suncheon Sarang Gift Certificate issuance, sales, and redemption scale reached an all-time high

Looking at the issuance status of the Suncheon Sarang Gift Certificate, 3.3 billion KRW was issued in 2018, 7 billion KRW in 2019, and by the end of last year, 116.8 billion KRW was issued, showing remarkable growth.

Compared to 2019, the issuance amount increased by approximately 1,568%, with last year's sales amounting to 86.2 billion KRW and redeemed amount reaching 77 billion KRW, representing increases of 1,336% and 1,380% respectively compared to the previous year.

The number of affiliated stores (places of use) where citizens can use the certificates also increased to 9,524 locations, a 55.7% increase from 6,117 locations in 2019, allowing citizens to conveniently use them across various industries.

▶ Consumption of daily necessities closely related to everyday life such as restaurants, cafes, and gas stations

According to the survey on consumption patterns by industry, about 70% of the total consumption amount was used in retail sectors such as grocery marts, butcher shops, gas stations, and clothing stores, and 22% was used in restaurants and cafes, indicating that mainly daily necessities closely related to everyday life were consumed.

The places where the Suncheon Sarang Gift Certificate was most used were traditional markets such as Yeokjeon Market, Agricultural Wholesale Market, Araetjang, and Utjang, with usage mainly focused on daily necessities, similar to the consumption patterns by industry.

In terms of user age groups, those in their 40s and 50s used the certificates the most, and with the introduction of various payment methods, usage among younger generations in their 30s and 20s has been steadily increasing.

▶ Expansion of discount rates and various support policies such as disaster relief payments driving consumption activation

According to the analysis of monthly usage amounts last year, February had the lowest usage at 1.4 billion KRW, while June had the highest at 18.9 billion KRW.

The average monthly ripple effect on the local economy was about 6 billion KRW.

In particular, consumption surged in May and June, which is attributed to the 10% discount sales policy along with various support policies including government-type, Jeonnam and Suncheon-type disaster relief payments, and public service allowances for farmers and fishermen, which greatly influenced consumption activation.

▶ Development into a sustainable local currency through expansion of affiliated industries and diversification of user age groups

Suncheon City plans to continue the 10% special discount sales this year to overcome the prolonged economic downturn caused by COVID-19 and revitalize the livelihood economy.

Since the Suncheon Sarang Gift Certificate has a virtuous cycle effect on the local economy, the city plans to issue it on a scale of 100 billion KRW to help small business owners and neighborhood markets in the region recover together.

Additionally, the number of affiliated stores for the Suncheon Sarang Gift Certificate will be expanded to 12,000 locations by registering affiliated stores across various industries to enhance the convenience of using the certificates. A mobile (QR code) type gift certificate will be introduced in the first half of this year to allow various age groups to easily purchase and use it through diverse platforms.

Furthermore, to address concerns about illegal distribution due to increased issuance volume, a plan to prevent illegal distribution will be established, and real-time monitoring will be conducted using the integrated management service system of the Korea Minting and Security Printing Corporation to ensure the sustainability of the local currency.

Based on monitoring results, on-site inspections will be conducted for affiliated stores suspected of illegal distribution, and stores found violating regulations will receive warnings, have their affiliation canceled, or be fined up to 20 million KRW.

The Suncheon Sarang Gift Certificate is currently available in two forms: paper type and card type, with a 10% special discount sale ongoing throughout the year.

The paper type can be purchased at 48 branches including Nonghyup Bank, Suncheon Nonghyup, Livestock Cooperative, Wonhyup, and Nakhyup, while the card type is available as Nonghyup Card and Post Office Card and can be issued by visiting Nonghyup or the Post Office or through the ‘Local Gift Certificate Chak’ app.

After card issuance, gift certificates can be purchased (recharged) through the app, and affiliated stores can settle payments without visiting the bank separately.

A Suncheon City official stated, “The easiest way to overcome COVID-19 while revitalizing the local economy is to purchase the Suncheon Sarang Gift Certificate and use it in nearby neighborhood markets,” and added, “We ask for many people’s participation in using the Suncheon Sarang Gift Certificate.”