Use of the Livelihood Recovery Consumer Coupons is limited to businesses with annual sales under 3 billion won, prompting a widespread frenzy among consumers to locate eligible stores. At health and beauty chain Olive Young, only about 200 out of its 1,379 branches nationwide qualify, sparking what has been dubbed a “coupon pilgrimage.”
The photo taken on July 27 shows empty shelves at one such Olive Young franchise in Seoul, illustrating the explosive demand. Products have been flying off the shelves—clear evidence of the campaign’s consumer impact. (Yonhap)
SEOUL, August 2 (Korea Bizwire) — South Korea’s emergency consumer coupon program, launched to revitalize local economies, achieved a 90% disbursement rate within just 11 days of rollout, but has since come under scrutiny over illegal cash conversions and human rights concerns related to the card’s design.
The “Livelihood Recovery Consumer Coupons,” issued in prepaid card form since July 21, are intended to boost spending in local shops. However, authorities have already detected at least nine cases of suspected misuse in Gwangju alone.
On July 30, during the sweltering heat of Jungbok (the second of Korea’s three hottest summer days), a banner reading “Welcome Livelihood Recovery Consumption Coupons,” along with cooling mist, greets visitors at Bujeon Market in Busanjin District, Busan. (Yonhap)
Some business owners, ineligible due to high annual revenues, attempted to circumvent rules by processing payments through other merchants’ card readers or leasing devices from tenants.
Other abuses include attempts to exchange the coupons for cash, with reports surfacing on secondhand trading platforms of individuals selling the ₩150,000 cards for discounted prices, or demanding bank transfers in exchange for coupon refunds after dubious complaints about food deliveries.
In response, the Ministry of the Interior and Safety ordered local governments to establish monitoring centers and conduct frequent merchant inspections. The National Office of Investigation also launched a special crackdown, targeting unlawful practices such as “card-kiting,” fake sales, peer-to-peer fraud, and third-party transfers.
On July 24, at a community service center in Buk-gu, Gwangju, government workers are seen affixing stickers to consumer relief cards to obscure their original colors. The city had come under fire for issuing color-coded prepaid cards based on income levels—a move widely criticized for lacking sensitivity to human rights. (Yonhap)
Violators could face penalties under the Credit Finance Act and the Subsidy Management Act, including repayment demands and future benefit restrictions.
Separately, controversy erupted in Gwangju, Busan, and Ulsan after prepaid cards were printed in different colors based on recipients’ income levels. In Gwangju, for example, standard recipients received red cards, lower-income individuals received light green, and basic welfare beneficiaries received navy — raising privacy and discrimination concerns.
President Lee Jae-myung sharply criticized the move as “a textbook example of administrative convenience at the expense of human dignity.” Authorities have since attempted to mitigate the issue by covering card colors with stickers.
Despite the issues, government officials point to the rapid and relatively smooth execution of the program, particularly compared to earlier pandemic-era payouts. “Officials have accumulated experience and built the necessary systems,” said one metropolitan government employee. “The fact that 90% of payments have already been made speaks for itself.”
M. H. Lee (mhlee@koreabizwire.com)
