Apple Pay to launch service in Korea in March

[Image source: Apple]

South Korea has approved U.S. Apple Inc. to launch its contactless payment service, most likely in March, which will bring about changes in the contactless payment market currently dominated by Samsung Pay.

The Financial Services Commission (FSC) said on Friday that it has reviewed relevant rules and laws and concluded that credit card companies can introduce Apple Pay following due procedures.

Hyundai Card Co. that joined hands with Apple to introduce the service in Korea will be the first to launch Apple Pay service, which is likely to stir up the Korean contactless payment market that is accounted 80 percent by Samsung Pay.

Apple Pay is projected to dominate about 30 percent of the country’s entire contactless payment market given that its iPhones account for the same share in smartphones. The remaining 70 percent is held by Samsung Electronics Co. handsets.

Industry insiders, however, note that it will take some time for Apple Pay to be widely used as there is yet lack of near-field communication (NFC) terminals equipped at retailers for the payment. Currently, only convenience stores, department stores, and coffee chains have NFC devices at their cash registers, which is about 10 percent of the market. The high commission rate of 0.1~0.15 percent demanded by Apple to the card companies could also slow service expansion in Korea.