KakaoPay’s Soaring popularity: impact on the outbound tourism
With the development and popularization of digital payments, QR code payments in Asian countries have become more active than ever. Therefore, instead of credit cards, tourists from various Asian areas who have been in this payment environment for a long time prefer shopping places where e-wallets can be used.
The figures can tell the truth. In South Korea, KakaoPay and Naver Pay are the most popular digital wallets, with 51% of consumers preferring Kakao and 30% preferring Naver. Until December 2022, there were approximately 39.4 million Korean users of mobile payment service Kakao Pay.
In this article, we will talk about the popularity of KakaoPay and Korean outbound tourism. We will also tell you why and how to accept KakaoPay in your store.
Popularity of KakaoPay and the reasons behind it
KakaoPay's user base is very large with total users at 39.4 million and monthly active users at 20 million. Since South Korea has a population of 51.78 million, which means that around 76% of the population has installed this application in their phones.
This trend has also reached foreign tourists visiting South Korea. In 2023, the scale of foreign tourists using KakaoPay for offline payments in South Korea increased rapidly. Compared with January, the payment amount in December increased by about 14 times, and the number of payments and users increased by about 8 times.
Overall, kakaoPay has become the top 1 mobile wallet in South Korea. Let's dive into the reasons behind its popularity.
Since 2019, KakaoPay’s mobile payment system has provided convenient transaction services for Koreans traveling abroad and foreign tourists in South Korea. This allows users to make payments abroad without exchanging currency and enables foreign tourists to use their mobile payment services at Kakao Pay-affiliated stores in South Korea. It is the only fintech company in the Korean market to provide such services.
South Korean outbound tourism
Koreans' desire for international travel and the wealth of information shared through mass media and social networking platforms have been driving the growth of outbound tourism. Recent industry surveys show that more than 85% of Koreans are eager to plan vacations in the next six months with overseas travel as the most anticipated activity.
Top preferred destinations of South Korean tourists
The United States remains one of the top five destinations for Korean outbound tourists and always remains the number one non-Asian long-journey destination. The majority of Koreans choose the United States as their preferred travel destination, mainly because it offers diverse travel opportunities and unique experiences that are not generally available in Asia.
Besides, the rate of choosing Europe increased by 12%. Among them, France, the United Kingdom, Italy, Spain, Germany and Switzerland are at the forefront of popularity. At the same time, in a survey of the foreign cities they most want to visit, Paris ranked first, followed by cities such as London and Rome.
How much do South Korean tourists spend overseas?
Under normal conditions, they spend about $4,900 per trip to the USA, this figure equates to more than $11 billion in revenue from Korean outbound tourists which ranked among the best in the world.
Why accept KakaoPay in your store?
With such a huge Korean travel market, accepting KakaoPay will certainly give you access to a base of customers with a very high spending power.
Meet the needs of South Korean customers
KakaoPay is a very popular mobile payment method in South Korea. Many South Korean customers like to use KakaoPay for transactions at home and abroad. Overseas merchants accepting KakaoPay can better serve these customers and improve their shopping experience.
Increase the variety of payment options
To attract more customers, merchants often offer a variety of payment options. Adding international payment options such as KakaoPay can diversify the customer groups that merchants serve and increase the number of potential customers.
Promote international tourism and consumption
With the development of globalization, more and more people choose to travel and shop abroad. Accepting international payment methods such as KakaoPay can attract more international tourists, especially South Korean tourists, and increase their local consumption.
Develop the cross-border e-commerce
With the rapid development of cross-border e-commerce, accepting international payment methods has become a necessary condition for merchants to expand their international business. With the acceptance of KakaoPay, overseas merchants can more easily access South Korea's huge e-commerce market.
How to accept KakaoPay in your store?
After establishing a partnership with Alipay plus in 2018, Kakao Pay began to provide online payment services to merchants using Alipay Plus around the world. Based on this partnership, South Korean tourists can make transactions at most stores using Alipay+ without installing additional apps. In other words, accepting Alipay+ in your store also means accepting KakaoPay.
This means that while your store is reaching the huge Chinese customers, it is also connected to the Korean market with great potential.
Integrating Alipay+ into your payment system is a crucial step for your business. Through Alipay Plus, merchants can also accept the major e-wallets in Asia-Pacific, not only in South Korea.
To seize the opportunities and get more revenue from Asian tourists, don’t hesitate to contact Silkpay or ask for suggestions.
Conclusion
KakaoPay's soaring popularity, particularly among South Korean users, will impact the way South Korean tourists pay abroad, offering a convenient and widely accepted payment solution. For international merchants, embracing KakaoPay by accepting Alipay not only satisfies the growing demand from Korean tourists but also enhances customer experience by providing diverse payment options. To connect the huge and potential tourism market, it’s the crucial step for all the merchants.
Source
https://www.mpaypass.com.cn/news/202401/17161913.html
https://www.statista.com/statistics/1128321/south-korea-number-of-kakaopay-users
https://www.linkedin.com/pulse/whats-kakaopay-why-you-need-support-one-koreas-most-popular-payment/
https://www.trade.gov/country-commercial-guides/south-korea-travel-and-tourism
https://www.toutiao.com/article/6776371611890090510/?source=seo_tt_juhe
Image by DC Studio</a> on Freepik
About the author: Silkpay
Based in Paris, Silkpay provides omnichannel and secure payment solutions to help physical stores and e-commerce in Europe accept more than 30 of the world's most popular payment methods: Visa, Mastercard, CB, UnionPay, Alipay+, WeChat Pay as well as Asia-Pacific’s major e-wallets.
Silkpay is a winner of the LVMH Innovation Award. The company was also selected as a finalist for the "Money 20/20" Best Startup and in the "MPE Berlin” Startup Awards. Silkpay also won the "Best Fintech" awards from Capgemini and BPCE.
Silkpay helps merchants deliver the smoothest payment experience to their customers. We are a talented and international team driven by a single goal: to improve the customer experience and make payments simple and secure.