"All Payment Methods Unavailable" Notice
CEO Choi Hyungrok: "Will Meet with Partner Companies This Week"
Online luxury platform Ballan, recently embroiled in controversy over delayed payment settlements, has completely suspended its payment services. This has raised growing concerns that a second 'Timon-Wemakeprice (Timemep) incident' might occur.
Balaan used Kim Hye-soo as the advertising model for TV and online channels. The advertisement featured the copy, "Why buy luxury goods at department stores?" Screenshot from Balaan's YouTube.
On the 30th, Yonhap News reported that Ballan's product purchases and payments have been blocked since the night of the 28th. Ballan posted a notice stating, "Currently, all payment methods are unavailable. We are taking measures to restore normal service as soon as possible. We apologize for the inconvenience caused." It appears that credit card companies and electronic payment gateways (PG) have suspended their services and withdrawn from Ballan, and Ballan's own payment service, Ballan Pay, is also unavailable.
On the 24th, Ballan caused controversy by failing to pay sales proceeds to some of its partner stores. At that time, Ballan explained, "We identified cases of duplicate settlement payments to several partner companies, and the settlement was temporarily suspended while normalizing the settlement system." They added, "We are quickly restoring the system." They also announced payment schedules to partner companies until the 28th and promised to pay delayed interest, but ultimately failed to keep these promises.
On the promised date, the 28th, Ballan CEO Choi Hyung-rok issued an apology for the settlement delay and stated, "I will meet directly with partner companies this week to explain the circumstances and plans." After this apology was posted, Ballan's payment services were suspended.
Some speculate that the current settlement delay crisis stems from Ballan's liquidity problems. Founded in 2015, Ballan was once recognized with a corporate value of 300 billion KRW in 2022, establishing itself as a leading domestic luxury platform. However, in recent years, it has faced difficulties due to sluggish sales and customer attrition, causing its corporate value to plummet to around 30 billion KRW, one-tenth of its past value. Since its establishment, Ballan has continued to post losses, with cumulative operating losses from 2020 to 2023 reaching 72.4 billion KRW. Ballan has been in a state of complete capital erosion since 2023, and it appears to have recorded significant losses last year as well.
In the distribution industry, there are even predictions that Ballan will become a second 'Timemep' and soon file for corporate rehabilitation procedures. Timon and Wemakeprice are currently undergoing corporate rehabilitation after causing a sales proceeds non-settlement incident involving about 50,000 partner companies and 1.3 trillion KRW last year.
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