Phones passed 55.7% of Korean card spending while plastic still grew in won terms

Divide the daily figure by the share and Korean card spending comes to about 3.21 trillion won a day this half ^[13], against about 2.40 trillion won in the first half of 2021 ^[14]. The pool grew roughly 34% ^[17]. Device payments grew about 58% over the same five years ^[16]. Plastic lost share by growing more slowly. Subtract the device portion and it still clears an implied 1.42 trillion won a day, up from 1.27 trillion, or about 150 billion won more ^[15]. Those are implied figures. They assume the share and the daily average sit on the same base, and the source rounds both.

At the past five years' average, the device share is gaining about 1.74 points a year ^[18]. The 55.7% is measured inside credit and debit card spending ^[3], so a phone tap in this series is still a card payment, made with a handset in place of the plastic. The report does not break out merchant fees or how they divide between wallet operators and card issuers.

One path is that the device share keeps climbing at roughly that pace on card rails, and the contest stays over whose wallet sits on the phone. The other runs through China, where mobile wallets rose from 40.2% of in-store spending in 2020 to 87% last year, according to Worldpay's Global Payments Report ^[1]. That rise of 46.8 points came over a similar five-year span ^[12], and the report puts QR payments that pull money straight from a bank account at nearly 90% ^[2]. The two series measure different things. Still, a rail that skips the card shrinks the card pool itself, where Korea's shift so far has only changed how the pool is split. A third route came from a banking industry insider, unnamed in the Korea JoongAng Daily report: "If stablecoins come into everyday use, credit cards and cash could be used far less often" ^[19].

We think the first path holds for now, because the card pool is still growing and plastic's won volume with it. The counter-case is China's pace, which shows how quickly a share can move once a different rail takes over. We would be wrong if Bank of Korea data showed total card spending flat or falling while account-based payments rose, or the implied plastic figure slipping back below its 2021 level.

Jeong Dae-young, a professor of economics at Yonsei University, frames the move off cash as a saving. "Paying in cash is costlier than paying digitally, given the expense of issuing, circulating and managing currency," he said ^[10]. He wants part of that saving redirected: "We need to build a system in which the money saved by digitizing payments can go toward expanding payment assistance services for vulnerable groups, such as automated help kiosks" ^[11].