40,000 Small Business Owners to Receive Free Apple Pay Terminals

Dongbanwi, New Payment Terminal Distribution Project
Targeting Businesses Over 1 Year Old with Annual Sales Under 3 Billion KRW
Supporting 40,000 This Year... "Benefiting Restaurant Owners"

[Asia Economy Reporter Kim Bo-kyung] The Win-Win Growth Committee will spend about 10 billion KRW this year to distribute NFC (Near Field Communication) terminals for small business owners. This project is attracting attention as Apple Pay is scheduled to be introduced in Korea next month. Consumers will have the opportunity to use Apple Pay at small business establishments that receive new terminals equipped with NFC functionality.

The Win-Win Growth Committee, together with the Credit Card Social Contribution Foundation, has been conducting the "Credit Card Small Merchant Support Project" from early 2020 until the end of this year. The project budget totals 40 billion KRW over four years, with 10 billion KRW invested annually. It is a program that provides new terminals or kiosks capable of recognizing NFC and QR codes as payment methods free of charge. This year, about 40,000 small business owners are expected to benefit.

The purpose of this project is to assist small-scale small business owners and self-employed individuals who are struggling due to economic downturn and excessive competition. It targets merchants with more than one year in business and annual sales under 3 billion KRW. VAN companies, which connect merchants and card companies, recommend candidates for support, and the Win-Win Growth Committee finalizes the recipients through review. Representative VAN companies include NICE Information & Telecommunication and Korea Information & Telecommunication.

A representative from the Win-Win Growth Committee explained, "We select merchants recommended by VAN companies with which we have pre-existing franchise agreements. We prioritize replacing old card payment terminals that have been used for more than three years."

The reason this project is gaining renewed attention this year is that the introduction of Apple Pay in Korea is imminent. Currently, the NFC terminal penetration rate is about 10% domestically, mainly installed in large retail chains such as Starbucks, Olive Young, and various convenience stores. There have been concerns that small business owners will not be able to accept payments via Apple Pay unless they replace their card terminals with ones equipped with NFC functionality.

Integrated terminals capable of recognizing both NFC and QR codes cost about 200,000 KRW, but participating businesses can receive them free of charge through this project. A Win-Win Growth Committee official stated, "The distribution of new payment method terminals will begin in May. Although restaurant owners are usually the main beneficiaries, most industries except for entertainment, pleasure, and gambling sectors are eligible for support."

Meanwhile, Hyundai Card holders using iPhones are expected to be the first consumers able to use Apple Pay. Hyundai Card has relinquished exclusive service rights for Apple Pay, which may allow other card companies to adopt the service in the future.