Zero Pay hasn’t paid off

The Seoul Metropolitan government’s ambitious campaign to save consumers and vendors from credit card fees through a direct payment arrangement between the buyer and vendor has drawn a tepid response despite its extravagant marketing pitch.

The so-called “Zero Pay” is a direct transaction system where consumers can scan a vendor’s QR code with their smartphones to make a payment. The money is transferred from the user’s bank account to the seller with almost free of service charge — just 0.5 percent — compared with the credit cards that typically charge between 1.4 percent and 1.9 percent per transaction.

The demo service has been available since Dec. 20. The city has plastered ads on streets, subways, bus stations, and on signage boards to pitch the new pay system for months. But few consumers are aware of the pay system or use it with a small number of merchants on the program.

Seoul Mayor Park Won-soon expressed confidence that the pay system will work out through continuous efforts in an interview. The mayor is suggesting that the city will pump in more tax funds in a project with questionable prospects.

The city has already endorsed 3 billion won ($2.7 million) for marketing expenses and supplies of QR kits for merchants. The Ministry of SME and Startups separately spent 2.9 billion won to recruit agents to market the platform.

The city and central governments have also respectively earmarked another 3.8 billion won and 6 billion won for Zero Pay marketing for this year. Despite the good intentions of helping out merchants, venture enterprises and digital payment, the results have been too disastrous for spending.

Only an average of 93 payments are made each day and vendors have saved a mere 1,16 million won so far. When will policymakers get smart with tax spending?

JoongAng Ilbo, Jan. 8, Page 30