Apple Pay may be available in Korea soon via Hyundai Card

An Apple logo on the facade of the downtown Brooklyn Apple store in New York [AP]

Apple is in talks with Hyundai Card to bring Apple Pay to Korea, according to local press reports and a source in the business.

"Hyundai Card has been negotiating with Apple for the introduction of Apple Pay," said the source. "The discussions have been underway for quite a while, but nothing has been decided yet."

Apple declined to comment about its plan for the digital payment service in Korea. It remains unclear whether Hyundai Card would be an exclusive partner or one of many.

Given the way Apple operates, any deal is far from assured.

In 2021, unconfirmed reports were published in the local press about Apple working with Hyundai Motor to building an electric car. Notoriously-secretive Apple never did work with the Korean car company on the project, and Hyundai Motor executives were investigated for insider trading related to the rumor.

Local media reports said that Hyundai Card will be the sole financial institution supporting the service at the initial stages, adding that the issuer and Apple have consulted with local vendors to develop electronic transaction processing and payment terminals for the new service. The vendors cited include Korea Information & Communications Co (KICC) and Nice Information & Telecommunication.

Other major card companies, like Shinhan Card and KB Card, are unaware of any deal in the works.

"There is nothing I heard about the issue," a spokesperson at Shinhan Card said.

Introduced in 2014 with the iPhone 6, Apple Pay can be used with cards issued in 72 countries. Korea is one of the few Asian countries without the service due in part to the extraordinarily low commissions in Korea.

The rate ranges from 0.5 percent to 1.6 percent per transaction, depending on the size of the seller. At mom-and-pop stores with less than 300 million won in annual sales, the financial authorities limit the fee to 0.5 percent.

Apple has been asking for a 1-percent commission, according to unconfirmed reports.

In an online community of electronic device vendors, a post by a person working at a payment vendor wrote that Apple Pay will be available next month.

Few retail shops have payment processing devices compatible with Apple Pay.

Of all shops in Korea, only about 5 percent have devices supporting near field communication (NFC) systems. Those without must install an NFC device, which costs around 150,000 won ($115), to serve Apple Pay users.

Hyundai Card, the fourth largest card issued in Korea, is 36.96 percent owned by Hyundai Motor, 11.48 percent owned by Kia and 28.56 percent owned by Hyundai Commercial.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]