About 200 stores in Myeong-dong shopping district in central Seoul are adopting technology allowing customers to swipe their smartphones for paying or using royalty points.

The Korea Communications Commission has selected Myeong-dong for its trial near field communication (NFC) service.

“We are the first to start such full-fledged NFC service in the world. We will lead the global market,” said Choi See-joong, chairman of the Korea Communications Commission.

Near Field Communication which allows data exchange, wireless connections and simplified transactions between two devices is starting to acquire a momentum in tandem with the high use of smartphones in Korea.

Korean telecom SK Telecom launched SmartWallet mobile app last year, replacing royalty point stamps and plastic membership cards at stores. More than 3 million consumers have downloaded the app using Android and Apple operating systems.

Another telecom, KT Corp, has launched a similar app called Olleh myWallet which can be downloaded via smartphones running Android OS. The app replaces transportation cards and chain store membership cards.

“The future outlook for wireless transactions seems promising,” said Lee Ho-yeon, public relations manager, SK Planet, SK Telecom’s mobile platform unit.

Korean supermarket chain Homeplus, a subsidiary of UK-based Tesco, has pioneered mobile shopping in the country. It opened a virtual store in a Seoul subway station where customers can scan pictures of products and have them delivered to their homes.

Since its launching of the virtual store, Homeplus has reported a 366 per cent increase in its sales. The company is expecting 2 million downloads of the app early next year.

GB