Payment cards continue to dominate e-commerce payments in South Korea with a 54% share, according to GlobalData.

Payment cards remain the most preferred payment tool for e-commerce purchases in South Korea, collectively accounting for more than half (54%) of all e-commerce payments in 2023, indicating a strong preference among online shoppers for safe and convenient transactions, finds GlobalData, EPI publisher.

GlobalData E-commerce analytics

GlobalData’s e-commerce analysis shows that South Korea’s e-commerce market grew by 10% in 2023, reaching KRW 150.3 trillion ($115.1 billion), as increasingly number of consumers are switching from offline to online shopping. The market is expected to grow by 9.1% and reach KRW 164 trillion ($125.6 billion) in 2024.

Poornima Chinta, senior banking and payments analyst at GlobalData, said: “South Korea’s e-commerce market is the third largest (by value) in the Asia-Pacific region, behind only China and Japan. The industry has evolved at a rapid pace over the past few years, supported by the country’s robust digital infrastructure, including high internet and smartphone penetration, as well as digital retail innovations such as the use of drones and robots for deliveries, AI-driven personalization and live streaming shopping streaming.”

GlobalData consumer research on financial services

According to GlobalData’s 2023 Financial Services Consumer Survey, approximately 81% of South Korean consumers reported having shopped online in the past six months, while only 10.2% of respondents said they had never shopped online.

Among various payment tools, payment cards take the leading position in the e-commerce area, with a total market share of 54.3% in 2023. Among card types, credit and charge cards are highly preferred with a share of 48.5%. This is due to the added benefits, including interest-free installment payment options, rewards programs, cash back and rebates associated with these cards.

However, alternative payment tools are slowly catching up with payment cards and are the second most frequently chosen payment method in e-commerce. This can be attributed to the security, convenience, and comfort associated with this payment method. Alternative payments will have a total share of 32.9% in 2023, and some of the popular brands include Samsung Pay, Naver Pay and China UnionPay.

Cash accounted for just 2% of e-commerce payments, reflecting the high use of electronic payment methods in the country.

Chinta added: “South Korea’s e-commerce market is poised for rapid growth in the next few years. The market is expected to grow at a compound annual growth rate (CAGR) of 9.2% from 2024 to 2028 to reach KRW 233.1 trillion ($178.5 billion) in 2028. With the growing popularity of alternative payment methods, it is likely to challenge the dominance of card payments in the near future.”

“Payment cards continue to dominate e-commerce payments in South Korea with 54% share, says GlobalData,” was originally created and published by Electronic Payments International, a brand of GlobalData.

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