"Fraud Worries Gone"…Used Goods Trading Platforms Compete to Secure Consumer 'Trust'

Strengthening Consumer Protection Amid Growing Awareness That "Trust Is Competitiveness"
Fraud Cases on the Rise While Police Crackdowns Fall Short
"Subscription-Based Compensation System" Proposed as an Alternative

Used goods trading platforms have been introducing consumer protection policies one after another to prevent fraud and ensure 'customer peace of mind.' As frugal consumption spreads amid high inflation, the used goods trading market is rapidly growing, leading to an increase in fraud cases. With the perception that trust is equivalent to competitiveness, the industry is making it a key strategy to create an environment where consumers can trade with confidence.

According to the industry on the 26th, the three major used goods trading platforms?Danggeun, Bungaejangter, and Junggonara?have recently been intensifying efforts to prevent fraud by expanding safe payment and compensation policies.

Danggeun recently introduced the 'Safe Payment Compensation System' in addition to its existing safe payment service. If a buyer suffers fraud, such as not receiving the item after making a safe payment via Danggeun Pay, the platform compensates up to 1.95 million KRW per case. Bungaejangter fully implemented escrow-based safe payment in August last year. Within two months of implementation, fraud cases decreased by 80%, positively impacting transaction activation. Junggonara also operates a damage compensation service through its own payment system, 'Junggonara Pay,' resulting in a payment transaction volume in February this year that was more than 21 times higher than at launch, marking an all-time high.

The reason these platforms are actively pursuing consumer protection policies is that police crackdowns have been insufficient compared to the rapid growth of the used goods trading market, increasing consumer anxiety. Consumer anxiety not only hinders the activation of used goods trading but also acts as a factor determining each platform's position in the market.

According to Mobile Index, the monthly active users (MAU) of Danggeun, Bungaejangter, and Junggonara in February this year were 18.13 million, 2.93 million, and 960,000 respectively, with the total number of users across the three platforms exceeding 22 million?nearly half of the domestic population. As the market grows, fraud cases are also surging. Used goods trading fraud cases recorded 123,168 in 2020 and maintained around 70,000 to 80,000 cases annually. However, by October last year, 81,252 cases had already occurred, suggesting that the annual total will exceed 100,000 cases, marking the highest level in four years.

Experts emphasize that used goods trading platforms must continuously establish mechanisms to reduce transaction risks to enhance trustworthiness. Professor Eunhee Lee of Inha University's Department of Consumer Studies said, "As the used goods trading market grows, especially with an increase in high-priced item transactions, platform operators introducing products like a guarantee insurance-based 'Safe Membership' and offering consumers the option to subscribe regularly to receive compensation in case of damage could be an alternative."