Local business vouchers are a type of marketable securities that are only used within the region. These are generated by city(-si), county(-gun), and district(-gu) with an operating agency under the supervision of local governments. They can be used in restaurants, small businesses, traditional markets, convenience stores, etc. In addition, it cannot be used in department stores, shopping centers, hypermarkets, entertainment establishments, etc. It is issued in various ways in each region, such as paper, cards, and mobile payments.

  The purpose of local currency is to revitalize the local economy and support small business owners. If the economy is exhausted, the cash flow rate diminishes in the market at an alarming rate, especially in the local area far from metropolitan sites. When issuing local currency, the degree of simple product transactions can be stimulated within the region, and economic activities can be activated.

  Cheongju Pay, which was launched at the end of 2019, is issued in the form of a card. Citizens can purchase cards at a sales agency of Nonghyup or the National Credit Union Federation of Korea. Alternatively, install the Cheongju Pay application on a smartphone and apply for a card. People can charge money to Cheongju Pay by connecting it to another bank account. Like other local currencies, it cannot be used in department stores, hypermarkets, etc. From April 1, even stores with annual sales exceeding 3 billion KRW cannot be affiliates.

  Cheongju Pay offered 10% of its monthly recharge fee as an incentive until last year, and the incentive limit was 50,000 KRW. However, there were cases where incentives were lowered or stopped due to budget exhaustion. Finally, the rate was lowered to 7% in 2024, and the incentive limit was also adjusted to 30,000 KRW. There is a fixed budget for monthly incentives, so users can receive it on a first-come, first-served basis. Even if they charge it when the budget is exhausted, they cannot receive benefits that month.

  About 470,000 copies of Cheongju Pay have been issued so far, and over 1.7 trillion KRW has been spent. CBT reporters listened to the opinions of users to see whether the incentives affected the activation of Cheongju Pay and whether there were any shortcomings.

Student A (College of Business, 22): I started using Cheongju Pay when I was a freshman at the recommendation of my friend. As I could get an additional 10% incentive if I recharged the money, I thought there was no reason not to use it for a student who was always short of money. It was good to be able to save money thanks to incentives. In addition, depending on the significance of the Cheongju Pay business, it was only available in stores where annual sales did not exceed a certain amount, so I was also satisfied that I could help small business owners in the region. However, as incentives continued to decrease due to the limited budget, there were many cases when I could not get incentives if I missed the beginning of the month. It was cumbersome to charge while I was busy with my studies. To receive benefits before the budget runs out, I had to charge to the maximum at the beginning of the month. Because of this, I had trouble when I needed cash later. Of course, I could get a refund, but it also felt like a big disadvantage because I had to wait a few days. As a result, I do not use Cheongju Pay anymore.

Mrs. B in her 50s: I found out about the existence of Cheongju Pay because an acquaintance introduced the advantages of it to me. I started using it because I heard that I could get incentives and it offers more income deduction in year-end tax adjustment. Moreover, it is good that I can help small business owners as I visit traditional markets more often to use Cheongju Pay. However, in the past, there were many places where I could pay with Cheongju Pay, but now the number of affiliates has decreased a lot. I still use Cheongju Pay, but these things are indeed regrettable.

  Kim, the official in charge of the Economic Policy Division of Cheongju City Hall, said, “There is a large change in the issuance for the Cheongju Pay incentive budget. In 2022, the budget was 39.4 billion and the issuance scale was 485 billion. In 2023, the budget was 32.4 billion and the issuance scale was 431.3 billion.” Compared to the previous year, the charging amount decreased by 11.07%. In B’s Interview, the opinion that “the number of Cheongju Pay affiliates seems to have decreased” is the main reason that Cheongju City restricted the use of Cheongju Pay to stores with annual sales of 3 billion KRW or more. Due to the regulations, Cheongju Pay was not available in an additional 237 places.

  The CBT reporters interviewed the owners of stores located in Gangseo-dong, Heungdeok-gu, Cheongju-si. If so, is there any damage to affiliates due to the reduction of the local currency budget?

Butcher’s Shop Owner C: Owners have to apply for an affiliate to be able to pay for Cheongju Pay, so we also applied for an affiliate store. Actually, there is nothing particularly beneficial as a Cheongju Pay affiliate. Since it operates like a debit card, we have to pay a fee similar to regular cards. As Cheongju City provides benefits to citizens through Cheongju Pay, I think it will increase their consumption and help small business owners. However, using Cheongju Pay does not mean a surge in sales, so it does not feel like it. Just because the budget for Cheongju Pay has been cut does not seem to cause much damage to owners. Like before, there are still many customers who use Cheongju Pay. Small stores like ours have a fixed amount of food purchased at home, so reducing incentive benefits does not seem to change our sales or the rate of using Cheongju Pay. Also, I heard that the owner of the store will be given a penalty if they do not apply for an affiliate. As a result, I do not think that Cheongju Pay is good or bad from the perspective of the affiliate owner, but I think that consumption will be promoted a little with Cheongju Pay because it does not have any benefits.

Franchise Coffee Shop Owner D: My coffee shop operates as a Cheongju Pay affiliate. There are still many customers who use Cheongju Pay. It is like the usual rate without much change. There is nothing good or beneficial as an affiliate. However, I think that customers use Cheongju Pay a lot, so I consider that it promotes consumption.

  The CBT reporters investigated the “penalty given to owners” mentioned in C’s interview and found that the owners of the stores could be fined. Under the enforcement of the Act on Promotion of Use of Local Gift Certificates from mid-2022, stores that can apply for affiliates must apply and register through the site. If not registered, the use of Cheongju Pay will be restricted, and the owners will be fined.

  The damage to small business owners due to the budget cut of the local currency was not noticeable, but it was clear that there were complaints from users. It has not been long since the Cheongju Pay’s budget cut began, and since most of its affiliates are restaurants, coffee shops, and convenience stores, where small-scale transactions take place, the decrease in sales that store owners feel themselves does not seem to be significant. However, if support for local currency decreases as it is, it may eventually become an ineffective business that glittered for a while. In the future, more attention and support will be needed for local currency not to lose its original purpose.