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.
Why Korea’s payment systems leave tourists frustrated
An alleyway in central Seoul's Bukchon Hanok Village is crowded with domestic and international visitors in this November 2024 photo. Korea Times photo by Park Si-mon
By Lee Yeon-woo
Local convenience meets global incompatibility
If you're carrying paper money and coins in Korea, you might get a few curious looks. Most Koreans stroll the streets carrying nothing more than a small purse — or nothing at all — thanks to the widespread use of credit cards and mobile payments.
But for foreign nationals, the experience can be quite different.
Long-term residents with a Korean credit or debit card typically report few issues. However, short-term visitors tend to face the most difficulties, particularly in small shops or transportation settings, such as subway and train stations.
"Many stores claim that most cards can be used, but in reality, when using a card issued outside of Korea, payments sometimes fail due to communication errors with the store's card reader," one Reddit user wrote, recommending that visitors carry multiple types of cards when in Korea.
The most common and frustrating obstacle appears to occur when using public transportation.
Despite Korea’s reputation for technological advancement, the contactless or near-field communication (NFC) technology systems used in its public transportation do not universally accept all payment devices, which often excludes foreign visitors right when they need it the most.
The underlying issue lies in Korea’s domestic payment system, known as PayOn, which isn’t compatible with most international cards. As a result, foreign visitors must purchase a separate transportation card, such as T-money, which can only be topped up with Korean won. There have been options to pay with cash at subway entrances or on buses, but many buses are already going cashless.
"My previous experience with paying for the Seoul subway using the T-money card was quite frustrating because I'm not a fan of carrying cash," another user wrote on Reddit.
"Just accept payments from cards issued at banks abroad. Making tourists sign up for stuff is inconvenient, no matter how well-intentioned," a reader commented on The Korea Times' social media.
A sign reading “Only Domestic Cards are Accepted” is displayed above KTX ticket kiosks at Seoul Station, March 26. Only two machines accept international cards, one of which is out of order. Korea Times photo by Jung Da-hyun
Offline payments aren’t the only problem. Many online apps and websites also don’t accept foreign-issued cards — especially for services that require identity verification.
This starkly contrasts with the changing habits of tourists and their desire to experience unique local services, like ordering late-night fried chicken delivery.
Even foreign residents find the system unaccommodating.
Anthony Martin, host of a podcast about expat life in Korea, returned to Korea in 2022 after several years away. Without a visa or local bank account, he tried to buy a pair of shoes online using his British card. "Of course, it failed," he said.
"I had to ask a friend to order them for me and transfer the cash to him after a few weeks when my account was open," Martin said. "There are very little warnings when coming to Korea that this is the situation. It's quite frustrating."
As Martin noted, many foreign nationals are puzzled by these inconveniences in a country known for being digitally advanced.
Ironically, Korea’s very speed of digital progress, and the resulting deep-rooted convenience for locals, is contributing to the issue.
"Credit card usage surged around the time of the Seoul Olympics in 1988 and has been deeply embedded ever since," an official at a Korean payment terminal company said. "That widespread integration has actually slowed the adoption of newer technologies (which have now become the global norm)."
Even Apple Pay is struggling to gain traction. Samsung Pay, which dominates the market, is built around Korea’s domestic payment system and doesn’t use NFC — the technology Apple Pay relies on.
Foreign tourists shop at a Daiso store in Seoul, April 15. Yonhap
Industry officials at payment-related companies, contacted by The Korea Times, all noted that most businesses see "little incentive to change" to accommodate foreign payment methods.
Upgrading existing payment terminals requires investment, and in some rare cases, some store owners deliberately block foreign card transactions due to higher processing fees and slower settlement times.
The online retail market has also long catered primarily to domestic consumers. Although the infrastructure to support international payments exists, businesses often opt for domestic-only services when signing with payment gateway providers, simply because it’s more cost-effective.
"Ultimately, it depends on how much priority each merchant gives to the issue," said an official from a payment gateway company.
An official from a public transportation payment system company echoed this view, stating that the expected usage by foreign visitors may not be significant enough to justify major changes.
"There are plenty of issues to fix, but Koreans don’t notice them because everything is just too convenient for them," said Lee Jang-back, CEO of Orange Square.
As Korea sets ambitious goals to attract 20 million tourists annually and recruit more skilled global workers to offset its demographic challenges, experts argue that modernizing the country’s payment infrastructure is no longer optional.
"It is crucial to strengthen every link in the value chain of tourism as a long-tail industry and ensure the balanced development of all service elements," said Jang Soo-cheong, a professor of hospitality and tourism management at Purdue University and the director of Yanolja Research. "This comprehensive enhancement will be a key factor in encouraging foreign tourists to return to Korea."