Simple-payment transactions hit record W1.2tr a day in H1

The daily average transaction value of simple payment services — which let users pay with a password, fingerprint or facial recognition — hit a record 1.23 trillion won ($889 million) in the first half of this year.

According to data released by the Bank of Korea on Friday, simple payment services logged a daily average of about 38.22 million transactions worth 1.23 trillion won in the first half of this year, up 12.8% and 16.8%, respectively, from the same period last year — both all-time highs since the central bank began tracking the data in 2016.

Simple payment, also known as "easy payment," refers to services that allow users to pay for goods and services using only a simplified authentication method such as a password or biometric data including fingerprints and facial recognition.

Among simple payment service providers, electronic financial companies such as Naver Pay and Kakao Pay saw their transaction volume and value jump 13% and 17.5%, respectively, from a year earlier.

Electronic financial companies' share of the market edged up to 55.4% in the first half of this year from 55.1% in both halves of last year. Handset manufacturers ranked second with a daily average transaction value of 286.1 billion won, accounting for 23.3% of the total, followed by financial institutions at 260.2 billion won, or 21.2%.

The daily average number of prepaid-balance-based simple remittance transactions fell 1.5% from a year earlier to about 7.433 million in the first half, while the daily average value surged 19.8% to 1.17 trillion won — also a record high.

The Bank of Korea said simple payment growth was driven by increased use of online marketplaces and other e-commerce platforms, while simple remittances expanded largely on a rise in transfers to brokerage accounts.

Usage of payment gateway services — which handle payment processing, settlement and data transmission on behalf of online shopping malls and other merchants — also grew, led by credit card payment processing.

Last year, payment gateway services recorded a daily average of about 36.75 million transactions worth 1.72 trillion won, up 12.1% and 12.6%, respectively.

Overall prepaid electronic payment services also expanded, with daily averages of about 39.22 million transactions and 1.55 trillion won — up 14.5% and 21.9%, respectively.

Prepaid electronic payment services issue and manage prepaid balances — loaded in advance through linked accounts and similar methods — that can be used to pay for purchases, transportation fares and other expenses, or to send remittances.

Escrow services averaged about 5.87 million transactions and 27.1 billion won per day, up 21.4% and 6.2%, respectively.

Electronic billing and payment services, which handle collection and settlement of apartment maintenance fees, electricity bills, gas charges and similar recurring payments, averaged 320,000 transactions and 97.6 billion won per day, up 7.4% and 8.9%, respectively, from a year earlier.

The Bank of Korea said the overall expansion of electronic payment services reflects a continuing upward trend in economic scale, per-transaction values and demand for digital transactions over time.