The study is based on extensive secondary and primary research. The various sources studied during the secondary research include websites of payment/ banking/ industry associations, industry regulatory bodies, banks, and card issuers. The primary research included in-depth interviews with industry experts and key opinion leaders.
South Korea cards and payments market overview
The card payments market in South Korea grew at a healthy pace during the period 2012-2014 in terms of volume of transactions. Some of the factors fueling the growth are payment infrastructure and the benefits offered to debit card and credit card holders by the card issuers. In terms of number of transactions, the total card market is expected to grow at a CAGR of 5.3% over the period 2015-2020.
South Korea GDP per capita increased from USD 24,453.9 in 2012 to USD 27,970.4 in 2014. GDP per capita is likely to increase further over the forecast period, from USD 27,512.8 in 2015 to USD 36,749.8 in 2020.This increase in GDP per capita income levels is expected to increase the scope of payment cards use over the forecast period.
Charge cards segment represents a small portion of the South Korea pay later card market. The frequency of charge card use grew at a CAGR of 23.2% during 2012-2014. The frequency of transaction is expected to reach up to 193.8 times by 2020. The value of charge card transactions at POS terminals represented 99% of total charge cards transaction value in 2014. In the charge card segment, banks target high net-worth individuals and corporate customers.
In April 2016, KEB Hana Card and Myanmar Payment Union (MPU) signed a MOU to produce a co-branded debit card, which is expected to be launched in next six months. The collaboration is expected to bring convenience for South Korea people working in Myanmar and vice-versa in terms of remitting money to their respective country. KEB Hana Card issues credit cards to end users and corporations in South Korea. It also offers credit financing services, such as cash services and card loans, as well as issues mobile cards. MPU was formed by state owned and private banks in 2011 to provide ATM and POS switching services among member banks. It currently has 23 bank members.
Hong Pilate, EVP at KEB Hana Card, said: “I think that Myanmar will have many foreign visitors in the future. MPU is the only payment network provider in Myanmar. Through this MOU, we can work together to develop in the payment sector and cards system in Myanmar.”
Key players in the South Korea cards and payments market:
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