Korea grapples with declining ATM use in rapid shift to cashless society

A person walks past a row of automated teller machines belonging to major commerical banks in Seoul, June 22. Yonhap

Park Eun-sook, a convenience store owner in Seoul’s financial district of Yeouido, says she increasingly considers removing the automated teller machine (ATM) that was installed in her store 15 years ago.

“Back then, several people withdrew cash late at night on weekdays — usually for a couple of drinks at street stalls,” Park said, referring to vendors that serve snacks and alcoholic beverages from tents or other mobile structures.

“But I hardly see those withdrawals anymore. Even the stalls, which used to accept only cash for convenience, now take credit cards or accept mobile bank transfers," she said.

Park’s experience reflects a broader shift toward a cashless society, with ATM usage rapidly declining in Korea.

According to data released by the Bank of Korea (BOK), Wednesday, the amount of cash withdrawn or transferred using ATMs and other cash machines totaled 12.07 trillion won ($8.62 billion) in June, a 10.7 percent decrease from a year earlier. The figure was the lowest since February 2000, when it was 10.97 trillion won.

The number of ATM transactions also fell to 21.84 million in June, down 10.8 percent from a year ago. That number was just one-third of the volume recorded a decade ago, when monthly ATM transactions regularly exceeded 60 million.

The BOK attributed this drastic decline to rapidly growing digital payment methods, such as mobile wallets and app-based banking services, particularly since the COVID-19 pandemic.

One key driver of this shift has been the adoption of open banking — a system introduced in 2019 that allows consumers to access and manage multiple bank accounts through a single mobile app.

Open banking transactions reached 61.97 trillion won in June, up 5.5 percent from a year earlier.

While slightly below the all-time high of 68.53 trillion won in December 2024, open banking usage has consistently remained above the 60 trillion won level, even amid broader economic uncertainties.

Despite the clear benefits and convenience of digital innovation, the BOK said it is concerned about what a fully cashless society could mean for the broader economy, as well as citizens who still rely on physical currency.

The central bank said it is referring to cases in other countries, including the United States, Finland and Norway. These countries participated in a global currency conference in May that discussed the waning use of cash.

Key issues discussed at the conference included improving the efficiency of cash distribution systems, supplementing the role of physical money through offline central bank digital currencies and introducing a digital payment tax.

Participants also emphasized the importance of designing an ecosystem where cash and digital payments can coexist, and of designating cash as a public good to preserve its role in society.