South Korea is extending its digital currency experiment, as stores of 7-Eleven across the country now accept central bank digital currency (CBDC) payments. Under a nationwide test to evaluate the practical use of state-backed digital currency for everyday transactions, 7-Eleven will accept payments in CBDC. From April 1 to June 30, customers can buy products using CBDC and avail themselves of a 10% discount on all items.
The head of 7-Eleven’s digital innovation division, Moon Dae-woo, noted that participation proves to be in line with 7-Eleven’s objective, a wider goal. Moon said the initiative will speed up the company’s shift to digital payments.
The pilot of the CBDC involves 100,000 people who can change their bank deposits into a digital token, which is stored in a distributed ledger, like the Korean won. To be eligible, people should be at least 19 years of age with an account at one of the eight participating banks, namely KB, Kookmin, Shinhan, Hana, Woori, NongHyup, IB, K, and Busan Bank.
Besides 7-Eleven, this feature lets users spend their CBDC at coffee shops and spend them at delivery services and K-Pop merchandise stores. Each user, however, will only be allowed to carry out transactions totaling 5 million won (or around $3,416) throughout the trial.
According to a news statement from the BoK, the program will allow customers to use the digital won in about 4,000 shops. Originally set for the last part of 2024, this project is now being moved to early 2025. It shows how much they want to make digital currency popular.
CBDCs are government-backed and controlled digital currencies that are different from cryptos like Bitcoin. These changes will make finance easier and also enable the tracking of money by authorities.
This test is a major step toward the formation of a working digital currency ecosystem in South Korea. If the program goes well, it could lead to a wider rollout to enable transactions for everyday things.
