Seoul launches zero-fee digital payment system
The city of Seoul has moved to ease the transaction-fee burden on small and medium-sized businesses (SMBs) by launching the “Zero Pay” zero-fee digital payment system.
The system has been set up in partnership with banks and fintech firms in response to shop owners paying excessive proportions of their monthly sales into credit-card transaction fees.
Twenty banks and digital payment firms – with the notable exclusion of KakaoPay, South Korea’s most popular mobile payment service – are participating in the zero-fee digital payment system, which is digital-wallet activated via QR codes through which money is transferred directly between bank accounts.
Businesses with annual sales less than KRW800 million (US$708,820) will not be charged transaction fees, while those with higher takings will be charged fees well below the credit card industry standard of 2.2 per cent.
“If consumers and citizens use Zero Pay whenever possible, it will be a great help for self-employed businessmen,” said Seoul city mayor Park Won-soon.
Around 16,750 stores have signed on to the Zero Pay program so far.