SEOUL, Dec. 30, 2014 –Now comes a time when one can have a grocery shopping with a credit card even at a traditional market. Even only 1,000 won worth of vegetables can be paid with a card, and 1,000 won discounts are offered if one shops at a traditional market with a transportation card (T-money, or deferred transportation card) within an hour from getting off the subway or bus.
Seoul Metropolitan Government announced on Dec 28 that it would make it possible to pay with all types of cards, including credit card, T-money, and deferred transportation card at traditional markets. The new system will start at six major markets in Seoul; Mangwon Market(Mapo-gu), Gildong Market(Gangdong-gu), Shinwon Market(Gwanak-gu), Shinchang Market(Dobong-gu), Youngcheon Market(Seodaemun-gu), and Jeongneung Market (Seongbuk-gu). The city government plans to extend the number of markets in the system to 330 by 2018.
Seoul said that so far it has been difficult to pay with a card at a traditional market unlike large scale supermarkets or department stores, as few shops are subscribers of credit card payment system and many shop owners have been reluctant to accept card payment due to commission fees paid to a card company. For this reason, many citizens often prefer shopping at a large supermarket. The city government expects that the new payment system in the market can be a solution to all of these problems.
To this end, Seoul first distributed RF card readers in shops in the markets, which allows simple and fast payment by simple contact with T-money or deferred transportation card. About 6,000 card-reading terminals will be supplied to 6 major traditional markets, and the number of terminal distribution sets to increase further.
Second method to promote the system is to allow ‘No signature transaction’ in traditional markets in case of small amount of payment of 50,000 won or less, which had been mainly adopted in supermarkets or large scale stores. The decision came after considering most of payments are small scale in traditional markets and is expected to make it more convenient to shop at traditional markets. In the meantime, the number of credit card subscribed stores in traditional market will increase as well.
In addition, 1,000 won discounts are offered when one shops at a traditional market more than worth of 10,000 won with a transportation card (T-money, or deferred transportation card) within an hour from getting off the subway or bus. The service, which is introduced to promote use of public transportation system as well as traditional markets, taps into terminal’s automatic transfer information recognition function to process payment of transportation fees and shopping at a traditional market with a single transportation card.
To encourage shop owners to receive credit card payment, the city decides to subsidize 70 % of commission fess of card payment (1.5 % on average) for payment of 6,000 won or less. From 2015, the scope for the subsidy substantially expands to payment of 10,000 won or less, to promote card payment even for small amounts of payment around a few thousand ones.
More notably, Seoul city government will introduce a service in which Korea Smart Card Co.Ltd collects all the payments from credit cards and remit the money to shop owners’ accounts at the same time. So far, credit card companies’ transfer days were largely different, making it difficult for shop owners to manage day-unit revenues.
To this end, Korea Smart Card Co. will begin a pilot project in six traditional markets. The company will distribute 600 Simple payment terminals to the markets and establish relevant system and offer the service. Woori Bank will also join the efforts, providing subsidies for shop owners’ communication and management fees who adopt the card payment system.
In the meantime, Seoul city government held an opening ceremony for ‘Seoul’s Pilot Project for simple card payment system in traditional markets’ at 2:00 p.m. at Mangwon Market, Mapo-gu. Attendances included Seoul mayor Park Won-Soon, presidents of traditional market shop owners’ association, shop owners, and ordinary citizens. Also at the ceremony, Joint-agreement among SMG, the shop owners’ association, Woori Bank, and Korea Smart Card Co.Ltd was signed and card payment method was demonstrated.
Seo Dong-Rok, director of SMG Economy Promotion Department, said, “Through this pilot project, we are dedicated to solving inconveniences of shopping at the traditional due to unavailability of card payment, which has discouraged consumers to use traditional markets. We will continue to expand card payment system in the markets. We hope that simple card payment will lead to enhanced service of traditional markets and foster an environment where citizens and shop owners can make transactions more easily.”