Introduction to South Korea

An overview of South Korea's currency, population and key statistics.

Cash currency

South Korea's currency is the won, abbreviated as KRW. Banknotes are available in denominations of ₩1,000, ₩5,000, ₩10,000, ₩50,000, and ₩100,000. Common coins are ₩10, ₩50, ₩100, and ₩500, while ₩1 and ₩5 coins are rarely used in daily life.

Digital currency

South Korea is exploring a central bank digital currency. The Bank of Korea launched a pilot program in August 2021 to evaluate the essential functions of the digital won. The initial trial ended in December 2021, but the launch of a digital currency is not guaranteed.


South Korea's population is estimated at 51.78 million in 2023, a 0.06% decrease from 2022. The country has a population density of 533 people per square kilometre (1,379 per square mile) and spans an area of 97,230 square kilometres. About 42.32 million people, or 81.7% of the population, live in urban areas. The median age has risen to 44.5 years.


Korean, also known as Hangul, is the country's official language and is spoken by approximately 80 million people worldwide, the majority of whom are of Korean descent. Many Koreans also understand English and Mandarin. In addition, there is Korean Sign Language.

Key statistics

South Korea's economy grew by 0.3% in the first quarter of 2023, after contracting by 0.4% in the fourth quarter of 2022. The country also posted its first trade deficit since 2008, due to slower export growth and increased energy imports. South Korea ranked 15th with a score of 73.7 in the 2023 Index of Economic Freedom.

Internet & mobile phone trends

South Korea remains one of the most digitally integrated nations in the world in 2023. With 50.56 million internet users, the country has a penetration rate of 97.6%, up slightly from 97% in January 2021. Additionally, South Korea is at the forefront of 5G technology, with an 88% penetration rate for 5G smartphones, signalling a rapid transition to advanced mobile technology.

E-commerce statistics

South Korea is a notable player in the global e-commerce landscape in 2023. As the 6th largest e-commerce market, it is expected to generate $85.54 billion in revenue, outpacing even France. Revenue projections indicate a compound annual growth rate of 2.9% from 2023 to 2027, potentially elevating the market volume to a staggering $95.96 billion by 2027.

South Korea's digital integration highlights its prominence in e-commerce. An impressive 93% of South Koreans are online, and internet shopping is especially popular among the younger generation, with a staggering 97% of people aged 20 to 39 embracing it. By 2023, the e-commerce user base is expected to reach 44.2 million people, translating to a user penetration of 76.9%. This figure is forecasted to surge to 85.6% by 2027. Furthermore, the average revenue per user is estimated at $2,150, showcasing the vitality of the country's e-commerce sector.

How people pay in South Korea

An overview of how people in South Korea choose to make payments.

Traditional payment methods

The primary traditional payment methods used in South Korea


A Visa credit/debit card is a financial payment card issued by banks or financial institutions. It allows users to make purchases, and withdraw cash and can be used online and in person. Visa's processing network can handle over 65,000 transaction messages per second.


Mastercard is a worldwide payment network that links financial institutions, merchants, and individuals, facilitating seamless transactions. This renowned company provides a range of credit and debit cards issued through partner banks. Customers may enjoy supplementary benefits such as rewards programs, cashback offers, and insurance coverage depending on the specific bank.

American Express

American Express cards encompass a range of payment cards provided by the multinational financial services corporation, American Express Company. The Amex card portfolio includes diverse options like credit cards, charge cards, and prepaid cards. Renowned for their broad acceptance among merchants, these cards grant cardholders access to various advantages, including perks, rewards programs, travel benefits, and dedicated customer service assistance.


Wise, previously TransferWise, offers a digital platform for convenient money transfers in South Korea. Users can transmit funds to over 80 global destinations, including South Korea, benefiting from minimal fees and favourable exchange rates.


T-money, a popular prepaid card among Korean subway riders, facilitates payments for public transport. This reloadable card also simplifies tunnel and parking fees. As a contactless payment option, taxis commonly accept it. Payments are automatically deducted from linked bank accounts.

Alternative payment methods (APMs)

Alternative payment methods.

Apple Pay

Apple Pay, a mobile payment service from Apple Inc., allows users to make in-person, online, and in-app payments. It replaces chip and PIN transactions at contactless terminals.


PayPal is a frequently used digital payment system that allows clients to use their PayPal accounts, debit/credit cards, or bank accounts. Customers use PayPal for secure online shopping and to send/receive money.

Google Pay

Google Pay is a digital wallet and payment service developed by Google. It allows users to make secure payments using their mobile devices or computers. It supports various payment methods, offers compatibility across different devices, and provides features like loyalty program integration and transit ticketing. Google Pay prioritises security and convenience with tokenisation and biometric authentication. It has expanded to include digital banking services and continues to evolve.

Samsung Pay

Customers can use Samsung Pay, a digital payment service by Samsung Electronics, for transactions. It's accepted wherever Visa cards are swiped, offering an easy mobile payment solution.

Kakao Pay

Kakao Pay is a digital payment solution for online and in-store purchases, as well as user-to-user money transfers. Users can link their Kakao Pay app to a bank account and make payments by scanning QR codes or tapping their devices on electronic readers. Approximately three-quarters of South Koreans reportedly use Kakao Pay.

Accepting payments in South Korea

A guide to accepting payments in South Korea

How to accept online payments in South Korea

Before accepting online payments, you must determine which methods you prefer. Then you can choose a payment gateway provider, a service that authorises and processes online payments with their specific system. 

Although there are plenty of payment gateway options in South Korea, the general process for online payments typically involves an acquirer, issuer, retailer, and cardholder in the following steps:

1. The cardholder initiates a payment by presenting their payment card to the retailer to purchase goods or services.

2. The retailer sends the payment details to the acquirer, who processes the payment request and sends it to the payment scheme (such as Mastercard or Visa).

3. The payment scheme sends the payment request to the issuer (such as a bank or licensed issuer) who issued the card to the cardholder.

4. The issuer checks if the cardholder has enough funds to complete the transaction and approves or declines the payment request. If the payment is approved, the issuer sends an authorisation code to the payment scheme.

5. The payment scheme sends the authorisation code to the acquirer, which then sends it to the retailer, completing the transaction.

How long does an international payment from South Korea take

The payment processing time may vary depending on the method and the recipient's bank. For instance, online money transfers through platforms like PayPal can quickly and conveniently send money to multiple destinations. 

  • Bank debit/credit cards: International payments with bank debit or credit cards may take a few minutes to a few hours, depending on bank processing times.

  • Online money transfers: Platforms like PayPal can process international payments within minutes to hours, depending on the service and destination country.

  • Wire transfers: Traditional bank-to-bank transfers or wire may take one to five business days or longer, depending on the destination country, intermediary banks, and transaction requirements.


Merchant fees

Merchant fees for online payments in South Korea can vary depending on the payment method and the merchant services provider used. Here are some examples of typical merchant fees for online payments in South Korea:

  • Credit and debit cards: Merchant fees for accepting online credit and debit card payments can range according to the transaction amount. It also varies depending on the type of card used and the merchant services provider.

  • Bank transfers: Bank transfer fees can vary depending on the bank used, with some banks charging a flat fee per transaction and others charging a percentage of the transaction amount.

 Other fees

Other fees surrounding online payments in South Korea include charges incurred by merchants, payment processors, and financial institutions involved in the payment processing chain. Below are some common fees: 

  • Interchange fees: Interchange fees are charges paid by merchants' banks to cardholders' banks to cover the costs of processing card transactions. These fees are usually based on a percentage of the transaction value and can vary depending on the type of card used and the merchant's industry.

  • Payment gateway fees: Payment gateway providers charge a fee for processing transactions on their platform, which may be a percentage of the transaction value or a flat fee per transaction.

  • Cross-border fees: If a merchant accepts payments from customers outside the country, they may be subject to additional fees for cross-border transactions, including currency conversion fees and international processing fees.

  • Merchant discount rate: A processing fee that merchants are charged for transactions made using credit or debit cards. This fee generally falls within 1% to 3% of the total transaction amount.

Security challenges of online payments in South Korea

South Korea's swift embrace of online payments signals its transition to a nearly cashless society. Yet, this shift comes with specific security issues:

  1. Foreign Technology Trust: Scepticism towards security technologies from the US may hinder the uptake of globally accepted security norms.

  2. Information Safety: Electronic transactions necessitate the sharing of credit cards, payment data, and personal details. Transmitting this delicate information online can become a target for theft.

  3. Mobile Wallet Concerns: Despite the growing popularity of mobile wallets, there's anxiety over potential data loss if a phone goes missing. In response, wallet services are enhancing their security measures.

  4. Regulatory Hurdles: The Criminal Code prohibits payments to local public officials, possibly affecting business ease and the introduction of certain payment technologies.

South Korea's banks and financial bodies are addressing online payment security issues with various strategies:

  1. Global Security Standards: While scepticism towards foreign tech exists, embracing internationally accepted security norms can bolster online payment safety.

  2. Data Security Enhancement: Robust encryption techniques can safeguard transactional information, curbing data theft and fraud potential.

  3. Mobile Wallet Safeguards: Mobile payment platforms are integrating heightened security, encompassing biometric checks, secure element tech, and options to remotely secure or erase data.

  4. Stricter Regulations: Regulatory entities can mandate tougher online payment guidelines, emphasising user data protection, transaction oversight, and anomaly reporting.

  5. Public Awareness: Educating the public on secure online payment habits is vital, covering topics like phishing threats, safe public Wi-Fi usage, and software updates.

  6. Antivirus Adoption: Comprehensive antivirus tools can further shield users, protecting against harmful apps, unsafe Wi-Fi networks, and unauthorised webcam access.

Tech Advancements: South Korea's ongoing AI experimentation can be leveraged to fortify online payment safety, including AI-driven fraud detection mechanisms.

Key sectors & industries in South Korea

According to the US International Trade Administration and various other sources, the top 10 industries in South Korea are:

Defence Industry Equipment

South Korea's defence industry equipment sector has experienced significant growth. By 2022, it had the world's tenth-largest defence budget and was the tenth-largest defence exporter. In line with its defence strategy, South Korea introduced the Defence Reform 2.0 program. This initiative aims to create a force that can address contemporary security challenges while minimising reliance on foreign defence technologies. It also promotes the development of indigenous technology and encourages the domestic production of weapons, both as components and entire systems.


The South Korean energy industry has several distinct features. In 2021, the country was the world's eighth-largest energy consumer, using over 12 exajoules domestically. It is heavily reliant on fossil fuels, which accounted for 85% of the total primary energy supply in 2018. This reliance extends to energy imports, which comprise 84% of the total supply. Industrial energy consumption dominates, accounting for 55% of total consumption, the highest percentage among IEA member countries. To address these challenges, the government launched the Energy Efficiency Innovation Strategy in 2019, targeting a 14.4% reduction in total final energy use by 2030, compared to expected trends.


South Korea's aerospace industry has experienced significant growth and evolution over time. Since 2013, the market has expanded to reach a potential valuation of $8.4 billion by the end of 2022. This growth is primarily driven by giants like Korea Aerospace Industries (KAI) and Korean Air. These companies not only produce parts for Boeing and Airbus, but they also leverage domestic technology to design and manufacture aircraft. In 2008, KAI's introduction of its first civilian aircraft, Naraon, made South Korea the 28th country in the world to produce and operate its own plane. Moreover, as of May 2022, South Korea ranks as the United States' 18th largest market for aerospace exports, according to the US Department of Commerce.


The information and communication technology (ICT) industry is pivotal to South Korea's economy, with its production value rising from approximately 525.8 trillion won in 2021 to an estimated 543.6 trillion in 2022. As the digital world becomes increasingly interconnected, cyber-attacks have become more sophisticated and threatening. Such attacks, orchestrated by global hacker groups, are now more organised, persistent, and wide-reaching. Reflecting this threat, the South Korean cybersecurity market expanded at a compound annual growth rate of 12% to reach $3.3 billion in 2020. 

Air Pollution Control

The air pollution control industry in South Korea is distinguished by notable characteristics related to air quality, market dynamics, and regulations. The World Health Organization identifies fine dust, specifically particulate matter (PM), as a significant health concern in the country. However, air quality has improved in recent years. In 2020, South Korea ranked 41st among 117 countries with a PM 2.5 concentration level of 19.5 ㎍/㎥. This improved to 54th place in 2021, with a PM 2.5 concentration level of 18.9㎍/㎥. Regarding market valuation, the air pollution control sector was valued at $5.0 billion in 2019, slightly down from $5.1 billion in 2018. This segment comprised 5.8% of the entire environmental technology and engineering domain in 2019.

Medical Equipment

The medical equipment industry plays a prominent role in South Korea's economy. In 2021, the industry's production value surged by over 30% to an estimated $11.2 billion, from $8.6 billion in 2020. Exports from local manufacturers also saw a significant increase, reaching $8.6 billion in 2021. Imports rose by 20%, contributing to the unprecedented growth of the medical device market in Korea.

Specialty Chemicals

The market size of the specialty chemicals industry in South Korea in 2021 was derived by adding total local production and imports and then subtracting exports. Local production reached $36.7 billion in 2019, while exports stood at $15.4 billion in 2019 but jumped to $22.4 billion in 2021. Similarly, imports increased from $13.6 billion in 2019 to $15.4 billion in 2021. Globally, South Korea's chemistry sector has seen rapid advancement, securing the fifth spot in production by 2020. In addition, the year 2021 experienced a 54.4% year-on-year boost in exports, spurred by rising export unit prices, elevated global oil costs, and an overall economic revival.

Travel and Tourism

Before the coronavirus outbreak, South Korea experienced an all-time high in visitor numbers. However, 2021 witnessed a sharp decline, with only 1.22 million Koreans travelling abroad, a staggering 95.7% drop from 2019. In 2018, tourism contributed 4.7% to the nation's gross domestic product and supported approximately 1.4 million jobs or 5.3% of overall employment. A key factor driving this interest is the "hallyu," or Korean wave, which encompasses the global appeal of Korean culture, from cuisine, beauty, and fashion to K-pop and K-dramas. Post-pandemic forecasts are optimistic, with South Korea poised to be among the first markets to bounce back and become a primary destination for American tourists. 


The South Korean cosmetics sector, often termed the K-beauty market, has several distinctive attributes. It is the 5th largest global exporter of cosmetic products, with $8.5 billion in exports in 2021. It ranks 10th globally and 3rd in the Asia-Pacific region. In 2020, the industry was valued at $6.8 billion, down from $9.4 billion in the previous year due to the pandemic. Remarkably, cosmetic exports to China soared to a record $4.8 billion in 2021. Domestically, the cosmetics market is largely dominated by power players such as Olive Young, Lalavla, and LOHR.


South Korea's entertainment and media industry is a pivotal contributor to its economy. The nation's Hallyu, encompassing TV shows, films, music, and games, has achieved worldwide acclaim, and the government has recognized its potential as a global leader in the entertainment and media industries.

Imports & Exports

South Korea's leading exports in 2023 are electrical machinery and electronics ($14.9 billion), followed by cars and related parts ($7 billion), machinery and associated appliances ($5.66 billion), mineral fuels and products ($4.44 billion), and plastics and their derivatives ($3.03 billion).

On the import side, mineral fuels and products lead the way at $12.7 billion, followed by electrical machinery and electronics ($10 billion), machinery and its parts ($4.74 billion), inorganic chemicals and compounds ($1.72 billion), and ores, slag, and ash ($1.72 billion).

Regulation in South Korea

The regulatory environment of South Korea

Summary of the regulatory environment in South Korea

To maintain fairness and operational smoothness in business ventures in South Korea, entrepreneurs are required to comply with a range of laws and regulations, which include:

  • Company law: This includes regulations governing companies' establishment, operations, and dissolution.

  • Employment law: This includes regulations governing employment contracts, working conditions, and employee rights.

  • Product liability law: This includes regulations governing the legal liabilities and responsibilities of manufacturers, sellers, distributors, and other parties involved in the production and sale of goods.

  • Intellectual property law: This includes regulations governing copyrights, patents, and trademarks.

  • Competition law: This includes regulations governing competition and antitrust matters to promote fair competition.

  • Consumer protection law: This includes regulations governing the rights of consumers, product safety, and advertising standards.

  • Data protection law: This includes regulations concerning the collection, use, and storage of personal data.

South Korea's business landscape is overseen by specialised regulations and governing bodies. For example, corporate governance is supervised by the Ministry of Justice and the Financial Services Commission, while labour matters are handled by the Ministry of Employment and Labour and the Korea Occupational Safety and Health Agency.

How card payments are regulated in South Korea

In South Korea, a variety of laws and guidelines oversee card payments, including transactions, payment tools, settlement systems, and clearing agreements. The Bank of Korea plays a central role in supervising these frameworks. Additionally, several market research reports detail the regulations governing South Korea's cards and payments sector.

Do I need a licence?

Yes, various business activities in South Korea may require specific permits and licences, such as construction, import/export, and environmental impact permits. EU citizens primarily need tax registration and a registration certificate, while non-EU residents must obtain a visa before starting a business or job search. Due to the diverse requirements based on business types, it is advisable to consult with a legal expert or local business advisor.

Payment solutions in South Korea

An overview of how to accept payments from customers in South Korea

Payment gateways and providers in South Korea

Due to the rapid emergence and evolution of new payment methods, companies must ensure that their customers have a seamless and efficient payment experience. To address this need, payment technology company APEXX has developed a solution that enables merchants to accept payments from multiple providers.

Recognising the importance of catering to the diverse payment methods that customers prefer, businesses need a streamlined and efficient processing solution. With the help of its Payment Orchestration Layer (POL) platform, APEXX provides a central hub that connects various payment methods and banks.

The ability to manage multiple payment methods through a single platform is a key advantage of the POL solution from APEXX. It also offers a variety of features designed to help businesses improve their efficiency.

Intelligent routing is one of the most prominent features of the APEXX POL solution. It uses a methodology that considers various factors, such as cost, risk, and currency, to choose the appropriate payment method for each transaction. This eliminates the possibility of failures and helps companies reduce their transaction fees 

Integrating APEXX POL with existing payment systems is effortless. The platform offers pre-built plugins and various APIs that enable integration with various payment platforms, including e-commerce sites and POS systems. This flexibility enables companies to seamlessly integrate the system, eliminating issues and disruptions.

As a leading payment provider, APEXX helps companies in South Korea and other countries improve their efficiency and manage their payment processing. Through its flexible payment orchestration framework, it enables them to effectively process multiple payment methods and improve their customer satisfaction.

Cheapest payment solutions in South Korea

To reduce fees in their payment stacks, merchants in South Korea can implement the following strategies:

  • Negotiate fees: Merchants should negotiate with their payment providers for better rates, which can include transaction fees, interchange fees, and monthly fees.

  • Choose a suitable payment provider: Merchants should research and compare different payment providers to select the one that offers competitive rates and low fees.

  • Use alternative payment methods: Merchants can reduce fees by using alternative payment methods such as e-wallets or bank transfers instead of traditional card payments.

  • Prevent chargebacks: To avoid chargebacks and additional fees, merchants can offer clear product descriptions, prompt customer complaint resolution, and refunds when necessary.

  • Implement fraud prevention measures: Merchants should adopt fraud prevention measures to prevent fraudulent transactions, which can lead to chargebacks and additional fees.

  • Monitor payment processing fees: Merchants should keep a close eye on their payment processing fees and use payment analytics tools to track their expenses and identify areas where they can reduce costs.

Merchants can also consider using payment aggregators such as APEXX, which allow them to accept multiple payment methods through a single platform, reducing the need for multiple payment providers and lowering costs.

BNPL in South Korea

Buy now, pay later (BNPL) is gaining popularity in South Korea, with companies such as Naver Financial, Kakao Pay, Toss, and Coupang offering it in anticipation of increased transactions. BNPL payments in South Korea are expected to grow by 20.9% annually, reaching $12.4 billion in 2023. 

 The BNPL gross merchandise value is expected to soar to $22.5 billion by 2028 from $10.3 billion in 2022, driven by e-commerce growth. However, BNPL also has its concerns, such as ensuring consumer protection and mitigating the risk of rising consumer debt.

 With such forecasts, South Korean merchants can use APEXX to integrate various payment systems or providers to provide BNPL options such as Klarna to their customers while also effectively managing their payment systems.

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