As the 'livelihood recovery consumption coupons' worth 12 trillion won are set to be implemented, the government is demanding that KARD companies lower the merchant discount rate, deepening the concerns of these companies. The KARD industry has attempted to communicate with the government to explain the circumstances and positions regarding the introduction of the consumption coupons.
According to the government and the financial sector on the 9th, the Ministry of the Interior and Safety recently requested that the merchant payment processing fees be additionally reduced during discussions with KARD companies regarding the introduction of consumption coupons. A KARD industry official noted, "I understand that the request for a reduction was raised during meetings with the Ministry while preparing for the introduction of the consumption coupons."
The consumption coupons can only be used at business sites with annual sales of 3 billion won or less. Most of the merchants eligible for the consumption coupons are small and medium-sized establishments, which are subject to preferential rates, but there are concerns that if additional reductions are made, the KARD companies may face 'negative margins.'
Concerns within the industry regarding consumption coupon payments have arisen because, unlike during the administration of Moon Jae-in, the merchant discount rates have already been significantly reduced.
Currently, the merchant discount rates are set at 0.4% for annual sales of up to 1 billion won and 1.45% for 1 billion to 3 billion won. During the payment of disaster relief funds, the KARD merchant discount rates were 0.8% (0.5%) for annual sales up to 300 million won, 1.3% (1.0%) for 300 million to 500 million won, and 1.6% (1.3%) for 500 million to 3 billion won.
Compared to the KARD discount rates applied during the previous administration's disaster relief payouts, the share taken by KARD companies has decreased even further, prompting the additional request for a reduction in the rates.
A KARD industry official stated, "In reality, small and medium-sized establishments already have low rates applied, making it a structure that does not generate profits," and added, "The expenses are greater than the revenue generated from these fees."
In response, the Credit Finance Association has requested a meeting with Kim Min-jae, the acting Minister of the Ministry of the Interior and Safety (Vice Minister), to explain the current industry situation. It is reported that a specific schedule has not yet been set.