110 Trillion Won Treasury Subsidies to Be Digitized... Six Major Banks Join Pilot Project

Domestic banks will participate in the Bank of Korea's pilot project for the digitalization of treasury subsidies, which is valued at 110 trillion won.

According to the financial sector on September 8, the six major banks?KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup, and IBK Industrial Bank of Korea?recently expressed their intention to participate in the subsidy digital currency test to the Bank of Korea.

The upcoming test will focus on verifying whether current government subsidies or vouchers (government-guaranteed coupons) provided from the treasury can be delivered to and used by recipients as digital currency.

Given the characteristics of digital currency based on distributed ledger technologies such as blockchain, it is possible to pre-program usage locations and periods. This is expected to fundamentally prevent fraudulent claims or use for unintended purposes, and also enable precise measurement of the subsidy’s effectiveness.

The Bank of Korea and the Ministry of Economy and Finance plan to hold a briefing session as early as mid-September to share the test schedule and key details with the banks that have expressed their intention to participate. If preparations proceed smoothly, the actual test could take place in the first half of next year.