A South Korean financial regulator said on Friday that the country had approved the Apple Pay launch to allow local credit card firms to introduce the Apple Pay service.
The announcement comes nearly two months after South Korea’s Financial Supervisory Service (FSS) confirmed to TechCrunch that it is reviewing the Apple Pay launch clause submitted by local credit company Hyundai Card, a financial unit of Hyundai Motors.
Per previous media outlets, Hyundai Card had a one-year exclusivity partnership with Apple Pay in South Korea. In other words, only Hyundai Card holders will initially be able to use Apply Pay service via iPhones and other Apple devices.
But this time, based on the Financial Service Commission (FSC) statement, other local cardholders also will be able to use the Apple Pay service, meaning Hyundai Card does not have its one-year exclusivity partnership with Apple Pay anymore. TechCrunch could not be reached Hyundai Card, which has yet to release an official statement, for more details.
The FSC noted that credit card companies should not have customers or merchants pay commissions incurred through Apple Pay; they should also be prepared to ensure users’ protection from risks caused by the theft of personal information. Apple would purportedly require the card issuer to pay a commission rate of 0.1% or 0.15% of the transaction amount.
The competition in the local mobile payment industry, in which local players like Samsung Pay have the most widely used, is expected to grow more intense in the country after the launch of Apple Pay.
South Korea’s lack of NFC (near-field communication) support at payment terminals in retail stores could be a hurdle for Apple Pay because only about 10% of 2.9 million local retailers in South Korea reportedly have NFC enabled in their credit card terminals. Most Korean retailers use magnetic secure transmission (MST), a mobile payment technology allowing smartphones to transact wireless payments with traditional credit card swipe readers and terminals. Apple Pay’s core payment terminal is NFC, while Samsung Pay uses both NFC and MST in the country.
In FSC’s statement, the financial authority said it expects Apple Pay service to promote the NFC payment service in the country.
South Korea is now the eleventh country in the Asia Pacific to support Apple’s wallet and digital payment service. The Cupertino-based firm is already operating its payment services in Australia, China, Hong Kong, Macao, Taiwan, Japan, Singapore, Kazakhstan, Malaysia and New Zealand.
Apple Pay gets the green light to launch its service in South Korea by Kate Park originally published on TechCrunch
source https://techcrunch.com/2023/02/03/apply-pay-gets-the-green-light-to-launch-its-service-in-south-korea/
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