Prepaid balances for South Korea's major fintech companies, including Naver Pay, Kakao Pay, and Toss, surpassed 980 billion won as of the end of June. This figure represents an increase of over 10% compared to the same period last year, indicating that mobile payments have become a common method of transaction. However, the total has slightly decreased from the previous quarter, as the companies prepare to cross the 1 trillion won mark.
According to reports from the companies on July 12, Kakao Pay's prepaid balance stood at 594.128 billion won at the end of Q2, reflecting a 0.5% increase year-on-year. Toss reported a balance of 207.865 billion won, marking a significant 54.7% rise, the highest among the three. Naver Pay also saw an increase of 11.8%, reaching 180.930 billion won.
As a result, the combined prepaid balance of the three companies totaled 982.897 billion won, up 10.8% from 887.2 billion won a year earlier. The combined balance has steadily grown from 887.2 billion won in Q2 of last year to 931.8 billion won in Q3 and 964.8 billion won in Q4.
However, this figure represents a decrease of about 7.3 billion won compared to Q1 of this year, when the total was 990.2 billion won, primarily due to a drop of approximately 8 billion won in Kakao Pay's prepaid balance.
Prepaid balances are funds that users load onto platforms for payments or transfers. They enhance user convenience while encouraging spending within the platform, making them a key indicator of growth in the mobile payment sector.
Recently, competition for securing prepaid balances has intensified as companies accelerate their efforts in the offline mobile payment market. Naver Pay is expanding its presence in both online and offline payment markets with its 'Naver Pay Connect' service, which features facial recognition payment technology called 'Face Sign.'
Toss is attracting users by promoting its remittance service and devices equipped with 'Face Pay' technology. It is also broadening the use of prepaid balances through its shopping platform. Kakao Pay maintains the largest prepaid balance among the three, thanks to its integration of everyday services like remittance, shopping, and gifting through the KakaoTalk platform.
Industry experts anticipate that competition in the mobile payment market will become even more intense. This is fueled by the announcement from Coupang, the country's largest e-commerce company, that it will expand its 'Coupang Pay' service, previously limited to its platform, into a universal mobile payment service called 'Rocket Pay.' As of the end of Q2, Coupang Pay's prepaid balance was 114.981 billion won, already exceeding 100 billion won with its existing service. Once Rocket Pay is officially launched, it is expected to compete directly with Naver Pay, Kakao Pay, and Toss.
* This article has been translated by AI.
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