Zero Pay still struggling to take off

Seoul Mayor Park Won-soon purchases coffee using Zero Pay QR code money transfer at a cafe in Hongdae Gyeongui Line Forest Park, Yeonnam-dong, Seoul, during a Zero Pay promotion tour of the area, Monday. / Yonhap

Seoul City vows QR code payment service improvements for official launch in June

By Lee Suh-yoon

Three months after its test launch in December, Zero Pay, the QR code mobile payment system backed by Seoul City, is still struggling to take off.

Colorful square signs indicating Zero Pay partner stores are easier to spot, especially on shop windows near City Hall or district offices, but requests to actually use the QR payment system are often met with blank stares.

"I haven't tried it out yet," a florist at a small shop in Insa-dong, Seoul, said when asked by the reporter if she could make payment with Zero Pay earlier this month. "You're the first person to ask."

Looking unsure, the florist turned to a small QR code sign set up next to the counter.

"Wait, I think I had an app for this," she said, nervously playing with her phone. "What bank do you use? I think you're supposed to use the banking app."

After a few minutes, the reporter located an obscure tab for QR code transfers inside the Shinhan Bank app, one of the partnered payment platforms, and transferred 17,000 won ($15) to the florist's account for some dried flowers and a cactus. Both let out a sigh of relief when the florist's cellphone buzzed in confirmation of the transfer.

Once you know the steps, Zero Pay is not difficult to use. But the multiple in-app steps are painfully tedious compared to a quick swipe of a plastic credit card. Consumers are offered a tax deduction rate of 40 percent ― higher than 15 percent for credit cards and 30 percent for debit cards ― but available only when the person manages to spend 25 percent of his or her total income through Zero Pay. It also lacks various benefits offered by bank cards such as monthly discounts at chain coffee stores or cinemas.

Zero Pay carries good intent: lower operating costs for struggling mom-and-pop stores (with annual sales lower than 800 million won) with a "zero commission" payment system. But the ambitious project has already spent 3 billion won ($2.6 million) in taxpayer's money with little to show for it.

According to the Ministry of SMEs and Startups, which spearheaded the Zero Pay project with Seoul City and other regional governments, the total transaction amount on Zero Pay was 530 million won ($467,000) in February ― double the figure from the previous month but still a trivial sum; credit, debit, and pre-paid card transactions total over 50 trillion won a month.

Another 6 billion won has been earmarked for the project's marketing and expansion this year, which will first target convenience store chains and some 60 franchise eateries and cafes. Public servants continue to be mobilized to encourage stores to be Zero Pay "partner stores," but many partner stores still find no use for their QR code have stopped offering the Zero Pay option due to inconveniences like tax calculation and having to manually check if the right amount was transferred with the shopkeeper's phone.

During a Zero Pay promotion tour of Yeonnam-dong area in Seoul, Seoul Mayor Park Won-soon said Zero Pay's official launch is scheduled after June. Seoul City and the ministry say that before then, they will optimize the service so that cashier machines at partner stores can process Zero Pay transactions, allowing store owners to scan customers' QR codes and input the payment amount on their own.

Site Map E-paper Subscribe Register LogIn
Site Map E-paper Subscribe Register LogIn