Lee Yeon-woo is a financial journalist at The Korea Times. Her wide range of reporting includes policies, macroeconomics, stock market, companies and even crypto. She is passionate about connecting the dots in Korean finance and making it easier for foreign nationals to understand. Based on her previous experience as a national reporter, she also has a keen interest in social issues within the sector, including gender equality and ESG. Your tips and insights are always appreciated. You can send them to yanu@koreatimes.co.kr.
Reporter's notebook Bank of Korea’s CBDC trial: Promising, but not yet ready to compete
A customer pays with a central bank digital currency at a 7-Eleven store in Seoul. Courtesy of 7-Eleven
By Lee Yeon-woo
A page from the reporter’s digital wallet in Hana Bank app / Screenshot from Hana Bank app
On Wednesday, this reporter tested a new payment method available at a 7-Eleven convenience store: a central bank digital currency (CBDC) introduced by the Bank of Korea (BOK) as part of a pilot program launched the day before.
Named Project Hangang, the three-month pilot by the BOK and seven local banks aims to test if a CBDC can be a viable alternative to Korea’s current transaction and settlement systems.
To get started, a digital wallet was created using Hana Bank's mobile app. The registration process involved agreeing to the terms, scanning a government-issued ID, verifying the identity, linking a bank account and setting a password. The steps felt similar to applying for financial products online, and the entire process took less than five minutes.
The next step was to top up the digital wallet using deposit tokens. When the user transfers funds from their regular bank account into the wallet, the money is converted into these tokens. Topping up was simple, just a few taps after selecting the desired amount. Converting the tokens back to cash was just as easy.
When it came time to pay, I only had to present a QR code. The clerk scanned it, and the transaction was complete within seconds. I walked out with a bottle of water and no hassle.
The entire experience felt similar to using existing mobile payment systems — convenient and smooth. That, in itself, was noteworthy. Deposit tokens currently don’t offer any obvious advantages for users familiar with other mobile payment services.
To attract more users beyond the pilot phase, the system will need to offer stronger incentives and expand its network of supported merchants. For now, offline payments are limited to Kyobo Book Centre, 7-Eleven convenience stores and about 100 Ediya Coffee shops, mostly concentrated in Busan and Incheon.
At the same time, there is still room for improvement in terms of speed. Existing mobile payment apps allow users to add widgets or shortcuts, enabling quick access to payment screens without launching the full app. In contrast, the CBDC system currently requires users to open the bank’s app and navigate through multiple steps before the QR code appears.
"Following the conclusion of the current pilot, a second round of testing is planned for later this year. The focus will be on addressing areas for improvement and fine-tuning the system," a BOK official said.