SEOUL, February 27 (AJP) - Shinhan Card and KB Kookmin Card are set to introduce Apple Pay as early as next month, following Hyundai Card’s initial rollout.
The expansion is expected to significantly widen the mobile payment service’s reach from its current 12.65 million users to potentially all iPhone users in South Korea.
The broader adoption of Apple Pay, however, may place financial pressure on small business owners.
Only 10 percent of South Korea’s 3.2 million merchant locations currently have the EMV contactless payment terminals required for Apple Pay. If the remaining 2.88 million small merchants upgrade their terminals at an average cost of 175,000 won per unit, the total expense could reach 504 billion won ($380 million).
“Small business owners will have no choice but to invest in new terminals,” an industry official said.
Market analysts warn that credit card companies may seek to offset the 0.15 percent fee paid to Apple by scaling back customer benefits.
Hyundai Card has already reduced rewards on its private-label credit cards since launching Apple Pay in March 2023, raising annual fees and increasing minimum spending requirements for multiple card products in 2024 and into early 2025.
Financial Services Commission Chairman Kim Byung-hwan downplayed these concerns, stating that “Apple Pay’s share of market transactions remains minimal.”
Meanwhile, Financial Supervisory Service Governor Lee Bok-hyun indicated that regulators are considering forming a task force to address emerging issues surrounding Apple Pay’s expansion.
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