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3 days ago
Korean Relief Payments Are Coming — Who Benefits Most?
In July, the Korean Government Will Open Its Wallet AgainThis year’s Consumer Relief Coupon Program is aimed at stimulating spending to boost the economy, similar to the COVID-era stimulus payments.Who gets it· All citizens, tiered by income levelTop 10 percent: 150,000 KRWGeneral population: 250,000 KRWLow-income and single-parent households: 400,000 KRWBasic welfare recipients: 500,000 KRWHow it works· Issued as digital coupons, linked to credit and debit cards· Not usable at large retailers or department stores· Usable at traditional markets, convenience stores, neighborhood supermarkets, restaurantsUsage period· Valid through November 30, 2025Distribution schedule· 1st round: July 21 to September 12, 2025· 2nd round: September 22 to October 31, 2025👉 The key detail: this is not cash, but purpose-driven spending.In the short term, this is expected to directly benefit local businesses and essential consumer sectors.How Will the Relief Payment Impact Consumer SentimentOver the past five years, including the latest round, the government has issued nationwide consumer relief payments three times. Out of the total 15.2 trillion KRW stimulus package, over 10.3 trillion is allocated to consumer relief coupons, accounting for more than half of the budget. An additional 5 trillion is aimed at supporting small businesses and stabilizing livelihoods.Shinhan Investment Corp. estimates that the impact on GDP growth will be limited, projecting a short-term lift of just 0.1 percent—suggesting this is not a structural solutionAccording to data from the Ministry of the Interior and Safety,mart and grocery purchases accounted for the largest share of spending from previous relief programs—27 percent in 2020 and 28.6 percent in 2021. This year’s relief coupons are also expected to concentrate spending in the same channels, likely benefiting the food and grocery sector most directly.Kyobo Securities highlighted that the Consumer Sentiment Index has remained above 100 points since May and reached 108.79 in June—its highest level in four years following the launch of the Lee Jae-myung administration. Based on this, they expect earnings recovery in the food and beverage sector in Q3.Interestingly, even though department stores were excluded from the list of eligible merchants during the 2020 relief payments, they still saw same-store sales rebound thanks to overall consumption recovery. Convenience stores also maintained growth, helped by increased tobacco sales. Key Beneficiaries by SectorPayment Infrastructure – NHN Payco (181710)· Operates ZeroPay-based local voucher payment platforms· Most direct payment infrastructure when using government coupons linked to local municipalitiesEssential Consumer Goods – BGF Retail (282330)· Convenience stores are eligible for coupon use, unlike large retailers· Strong exposure to basic goods like tobacco and foodRetail – Emart (139480)· Not officially eligible, but some channels like Emart24 and Traders can accept coupons· Focus on offline daily essentials positions it well for sentiment-driven recoveryDining – CJ CheilJedang (097950)· Operates dining brands such as VIPS, Cheiljemyunso, and The Place· Food service sector is coupon-eligibleBecause the use of relief coupons is restricted by merchant type, spending behavior is highly predictable.Where the Government Is Steering Consumer SpendingThe direction is clear:· Away from large retail and toward essential everyday purchases· Away from online and toward offline physical spending· Away from discretionary spending and toward repeatable, basic consumptionThis structure creates a favorable environment in the short term for specific sectors like convenience stores, dining, essential goods, and payment infrastructure.Now is the time to focus not on general expectations, but on how policy is actually reshaping demand in real time.[Compliance Note]All posts by Sellsmart are for informational purposes only. Final investment decisions should be made with careful judgment and at the investor’s own risk.The content of this post may be inaccurate, and any profits or losses resulting from trades are solely the responsibility of the investor.Core16 may hold positions in the stocks mentioned in this post and may buy or sell them at any time.
