Ministry of the Interior and Safety to Strengthen Crackdown on Illegal Distribution
Support Funds to Be Reclaimed and Criminal Penalties Imposed
14% Apply on First Day, 6.98 Million Applicants
1.2722 Trillion Won to Be Distributed
On July 21, the issuance of the "Livelihood Recovery Consumption Coupon" began, but there have been a series of cases where these coupons are being converted into cash through secondhand trading platforms, raising concerns about abuse of the system.
On July 21, numerous posts selling support fund cards under the keyword "Livelihood Recovery Consumption Coupon" appeared on the secondhand trading platform Danggeun Market. One user posted, "Selling a prepaid card worth 150,000 won for 130,000 won," adding, "The address is in Seoul, but I work and live in Incheon, so I don't have time to use it." Prepaid cards received offline can be used immediately on the day they are distributed. Similar sales posts were also found on the secondhand trading platform Junggonara. One user posted under the title "Selling Livelihood Consumption Coupon," stating, "I'm in Gyeonggi Province, but I'm currently in North Gyeongsang Province for work. For those who need it, I'll sell it at the lowest possible price so we can both benefit from a good deal."
On the 21st, numerous posts selling support fund cards appeared on secondhand trading platforms under the keyword "Minsheng Recovery Consumption Coupon." Secondhand trading platform
There are growing concerns that such support funds, intended to stimulate consumption and revitalize the local economy, are being distributed as cash online, undermining the original purpose of the program. The consumption coupon is restricted for use at stores with annual sales of 3 billion won or less, or at local gift certificate merchants, within the applicant's registered address area. If converted into cash, there is a high possibility that the funds will be spent at large supermarkets or directly operated stores of major corporations, significantly reducing the intended support effect for small business owners.
Furthermore, these transactions are clearly illegal and violate government policy. The Ministry of Economy and Finance and the Ministry of the Interior and Safety have announced, "The conversion of consumption support funds into cash is strictly prohibited," and warned that "if such actions are detected, the support funds will be reclaimed and criminal penalties may be imposed." However, as cases of abuse continue to be discovered on secondhand trading platforms, the Ministry of the Interior and Safety announced on July 21 that it would strengthen management of illegal distribution activities to ensure that the Livelihood Recovery Consumption Coupon is used for its intended purpose and leads to actual consumption in the market.
An information notice about usage is posted at a clothing store in Seoul on the 20th, one day before the distribution of livelihood recovery consumption coupons. Photo by Yonhap News
Illegal distribution refers to cases where consumption coupons are converted into cash through person-to-person transactions, or where merchants receive gift certificates without selling goods or for amounts exceeding the actual transaction value. If the coupons are converted into cash through such person-to-person transactions, contrary to the program's purpose, all or part of the support amount may be reclaimed under the "Act on the Management of Subsidies." In addition, penalties may be imposed and future subsidy payments may be restricted.
Currently, major online secondhand trading platforms such as Junggonara, Danggeun, and Bunjang are taking measures such as restricting certain search terms (e.g., consumption coupon, livelihood support fund) and deleting related posts. The Ministry of the Interior and Safety has also requested additional measures to prevent illegal distribution, such as posting notices prohibiting the resale of consumption coupons. In addition, local governments have been asked to operate regional "illegal distribution reporting centers," to conduct regular inspections of affiliated stores, and to strengthen monitoring of online communities to prevent person-to-person transactions.
The consumption coupon can be applied for in various forms, including credit/debit cards, prepaid cards, and local gift certificates, from today until 6:00 p.m. on September 12. To prevent congestion, the application schedule during the first week is based on the last digit of the applicant's birth year. Online applications through card company websites are available 24 hours a day, while offline applications at community centers are available from 9:00 a.m. to 6:00 p.m. on weekdays (until 4:00 p.m. at bank branches).
On the 21st, when the application for the Livelihood Recovery Consumption Coupon began, an employee at the Daebang-dong Community Center in Dongjak-gu, Seoul is receiving consumption coupon applications. Photo by Yonhap News
According to the Ministry of the Interior and Safety, on the first day of the initial application period for the Livelihood Recovery Consumption Coupon (July 21), 6,975,642 people, or 13.8% of all eligible recipients, completed their applications. The basic amount of 150,000 won per person will be distributed the day after application. The total amount to be distributed based on applications submitted that day is 1.2722 trillion won. By application method, 5,345,478 people applied via credit/debit card, the largest group; 996,452 people applied for mobile or card-type local gift certificates; 108,930 people applied for paper certificates; and 524,782 people applied for prepaid cards. The first round of support provides a basic amount of 150,000 won per person, with 300,000 won for low-income households and single-parent families, and 400,000 won for basic livelihood security recipients. Separately, residents of non-metropolitan areas (excluding Seoul, Incheon, and Gyeonggi) will receive an additional 30,000 won, and residents of rural areas with declining populations will receive an additional 50,000 won.
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