As Samsung Pay and KT are opening fire into simple payment markets, internet companies set out to counter-attack against them. KT and BC Card are also planning to regularly run ‘CLiP’ service, which loads wallet into mobiles, in October. Internet companies such as Daum Kakao, Naver, NHN Entertainment, and others, which earlier output payment gateway methods, are holding onto the reins in going after markets as they face tough competitors.
A company that is currently under the gun is NHN Entertainment that formally released ‘PAYCO’ on the 1st of August. PAYCO is a service that allows one to use both online and offline at the same time, and it is inevitable that NHN Entertainment will have to compete against Samsung Pay that is expanding its influence in offline.
NHN Entertainment is choosing its alliance with T-money as its strength. Starting from the 1st of September, ‘PAYCO’ payment is possible at any T-money terminals, and not only did T-money terminals are located in public transportations such as buses, taxes, and others, but it is also located in 100,000 affiliated stores such as convenience stores, discount stores, and others. It is confident that it can sufficiently take root as a daily life service as there are about 100,000 online affiliated stores that NHN Entertainment possesses.
It is very important for NHN Entertainment to quickly expand ‘PAYCO’ in offline, and NHN Entertainment is also installing its payment terminals (Cave) at affiliated stores starting from next month. It is currently testing Cave around Pankyo in Gyeongi-do, where its headquarter is located, and its goal is to install up to 10,000 terminals by end of this year. “Members increased up to 1.5 million people after formal service. If Cave terminals are installed everywhere and is possible to use T-money, then use of PAYCO will start to increase.” said Deputy Head Cho Jung Sook of NHN Entertainment.
Naver and Daum Kakao decided to strengthen their controls in online markets as Samsung emerged as a tough competitor in offline market for now.
Naver is focusing on reinforcing shopping after combining payment gateway methods last time. Naver secured 57,000 affiliated stores centered on shopping malls, and this is its strategic move to expand its influence in online and mobile shopping instead of offline since they have more controls in online and mobile shopping. Including KB Financial, Naver is also increasing the number of banks that it is working with and their cards.
“Naver Pay is a method that allows users to use search, purchase, and others non-stop at shopping malls that already have 15 million people using them. Instead of payment gateway market, Naver will focus on online shopping market.” said a person affiliated with Naver.
Daum Kakao, who first put out a mobile payment method ‘Kakao Pay’ in last September, is first focusing on a point that connects online and offline. By actively utilizing Kakao Talk Messenger that has many Korean users, it is planning to have Kakao Pay play a role of strong platform at a middle point of mobiles and offline. Within a year, its bases of members increased up to 5 million people and its affiliated stores also expanded to 200 stores. It is planning to have people pay yearly electricity payment by Kakao Pay by exchanging MOU with Korea Electric Power Corporation (KEPCO) this year and also have people pay utility bill by Kakao Pay by partnering up with Seoul Metropolitan City. If ‘Kakao Order’, which is a mobile pre-order service that Kakao is currently testing, gets released by end of this year, it can be paid by Kakao Pay also. Kakao is also planning to apply Kakao Pay on high-class taxis.
“Kakao Pay decided to focus on customers’ convenience by being able to connect mobiles and variety of areas in real life such as shopping, transportation, reservation, and others. It is possible to make a large amount of payment without personal certificates, we are planning to expand its uses so that it can be used in offline as well.” said a person associated with Daum Kakao.
As competition becomes fiercer, focus is on who will lead simple payments with a killer-like service.
“Although competition will heat up with aggressive marketing at first, there will be oligopolistic business and monopolistic business once payment methods become established. During this process, it is crucial for a business to secure members with a satisfying service and preoccupy markets.” said a researcher Lee Sang Hun from HI Investment & Securities.
Staff Reporter Lee, Kyungmin | kmlee@etnews.com
