We help businesses accept payments online.
PayCO is one of South Korea’s most popular digital wallets and payment apps. In 2024, it reported a total payment volume (TPV) of KRW 1.4 trillion, marking an 11% year-over-year growth. This makes PayCO a preferred payment method for many South Korean consumers.
Integrating PayCO gives eCommerce stores immediate access to a large user base familiar with this payment method. As a trusted service, PayCO can boost consumer loyalty, a critical factor for new entrants in the market. It offers a smooth payment experience via mobile phones or PCs, which can improve customer satisfaction and draw new and returning customers to eCommerce stores.
KOMOJU is a payment gateway solution that simplifies integrating various payment methods—including PayCo—into eCommerce platforms. It supports multiple languages, offers easy API integration, and, most importantly, ensures secure transactions. It provides a sense of reassurance and confidence for your business and customers—ideal for integrating PayCO and other payment options into your store.
This article will explain the PayCO payment app and how it can benefit your eCommerce store.
What is PayCO?
PayCO is a digital wallet and payment app widely accepted throughout South Korea. It was developed by NHN Corporation, a leading tech company in South Korea involved in various industries including payment processing, gaming, advertising, commerce, and technology.
Users can link bank accounts and credit and debit cards to facilitate transactions. The app supports various payment methods, including NFC (Near-Field Communication), barcode, QR, and MST (Magnetic Secure Transmissions) technology. Users can make purchases, transfer money, pay bills, and accumulate PayCO points for benefits and rewards.
Since its launch, PayCO has seen rapid growth in popularity. By 2023, PayCO is estimated to have over 12 million users, capturing about 10% of the South Korean mobile payment market. Additionally, over 90% of South Korean merchants accept PayCO.
This growing popularity is fueled by South Korea’s increasing preference for mobile wallets, which have become a mainstream payment method. According to market researcher Mordor Intelligence, nearly two-thirds of South Koreans use mobile wallets for in-store payments.
The mobile payment industry in South Korea is highly competitive, with major players like Naver Pay, 11Pay, Samsung Pay, and Kakao Pay dominating the market. Naver Pay holds a 29% market share, followed by Kakao Pay at 18%, Samsung Pay at 16%, and 11Pay at 12%.
Despite the competition, PayCO is particularly popular among university students. This is thanks to the “PayCO Campus Zone” feature, which facilitates convenient transactions at campus food courts, cafes, and convenience stores. Students also use PayCO to manage educational vouchers and benefits.
PayCO has also formed strategic partnerships, becoming YouTube’s first South Korean mobile payment partner. Key partnerships include collaborations with Samsung Pay/Samsung Card (until 2024), T-money (South Korea’s train system), and South Korea’s top five convenience store chains: GS25, CU, 7-Eleven, Emart24, and Ministop.
In addition to its domestic focus, PayCO serves international users. In 2019, it joined the “Cross-Border Mobile Payment Alliance,” a consortium of leading payment services, including LINE Pay in Japan, iPASS in Taiwan, and Naver Pay. This collaboration enables nearly 80 million users across Asia to make electronic payments at the same stores, a massive boon to the convenience of cross-border transactions.
PayCo Features
The PayCO app offers several useful features that make it a popular choice for digital payments:
- Digital Wallet: PayCO allows users to store and manage multiple credit/debit cards and bank accounts within the app, eliminating the need for physical cards. Transactions are secure and convenient, with encryption and authentication methods like passwords or fingerprints.
- Multiple Payment Options: Users can register multiple bank accounts and credit/debit cards, including the PayCO Lotte Card, which offers higher point collection rates and exclusive rewards.
- Banking and Remittance: PayCO supports easy transfers between bank accounts and payment apps, with affiliate accounts from major financial institutions like SC First Bank, Hana Bank, and Hanwha Investment & Securities. Most transfers are free of charge.
- Points System: Users earn PayCO Points through purchases, which can be redeemed for discounts and benefits at affiliated merchants. The system is fully integrated into the app, making tracking and managing points easy.
- Easy Bill Payments: PayCO allows users to set up automatic transfers for recurring bills, such as utilities, rent, or subscriptions, ensuring timely payments.
- PayCO Campus Zone: PayCO also offers a dedicated feature for university students called PayCO Campus Zone. This feature was made specifically for university campuses with a high concentration of users in their 20s. Students can make PayCO payments on campus using their smartphones, which has helped PayCO gain a large user base among university students.
How PayCO Works
Most stores, applications, and online shops in South Korea will list PayCO as a payment option at checkout, making it convenient for online and offline transactions. Customers can choose any card or bank account linked to PayCO to complete the transaction.
To use the PayCO app, users must:
- Register with a valid South Korean mobile phone number or email as their ID.
- Add a bank account, credit card, or mobile phone as a preferred payment method.
- Finish identity verification required during the initial registration.
Although the PayCO application does not offer an English option, businesses can use KOMOJU, an alternative payment solution for eCommerce stores entering the South Korean market (or operating globally). KOMOJU can set up PayCO on your store without language barriers, allowing you to focus on your business.
Offline Payment
Offline payments with the PayCO app typically involve scanning a QR code or barcode. To make an offline payment, users open the PayCO app and scan a QR code provided by the merchant or display a barcode on their screen for the clerk to scan. Alternatively, if contactless payment is supported, users can touch their phone to a card reader. The funds are deducted from the user’s PayCO points, connected bank account, or credit card.
Online Payment
Online payment via PayCO is straightforward. At checkout, the customer selects PayCO as the payment method and enters their PayCO ID and password for the first payment. They select the PayCO option on the payment screen for subsequent payments, and identity verification is completed automatically. The funds are deducted from the user’s PayCO points, connected bank account, or credit card.
How To Pay Online With PayCO
To make an online payment with PayCO, follow these detailed steps:
- Log into PayCO Account: Open the PayCO app and log into the account using the PayCO ID and password.
- Select PayCO at Checkout: On the merchant’s website, select PayCO as the payment method during checkout.
- Scan the QR Code or Enter Authentication Code: If prompted, scan the QR code displayed on the checkout screen with the PayCO app, or enter the authentication code provided.
- Confirm Order Information: Review the order details in the PayCO app to ensure everything is correct.
- Input Password and Confirm: Enter the PayCO password and press the confirm button to complete the transaction.
- Successful Payment: The order is processed, and the funds are deducted from PayCO points, a connected bank account, or a credit card (whichever is preferred). A confirmation of the successful payment will be received.
Benefits of Using PayCO for Customers
Below are some key advantages of using PayCO for customers.
Convenience
A significant benefit of using PayCO is its convenience. The app serves as a digital wallet, allowing users to store multiple credit/debit cards and bank accounts, eliminating the need to carry physical cards. This makes transactions faster and more convenient, whether shopping online or in-store. The app’s integration with numerous online and offline merchants and services further improves its usability.
PayCo Points
PayCO users can earn points through various transactions. For offline purchases, 1% of the payment amount is accumulated as points. For online transactions, 0.2% of the payment amount is accumulated as points. These points are stored in the PayCO digital wallet and are accumulated monthly based on the previous month’s spending.
Users can enjoy discounts and rewards when using PayCO Points, making it a cost-effective payment option for frequent transactions. Points can be used for online and offline purchases across various merchants and services, including transportation, shopping, and bill payments.
Likewise, points can be topped up using registered bank accounts, direct deposits, and PayCO gift cards. Users also have the option to recharge points through small credit loans provided by Hanwha Life Insurance. Unlike many other digital wallets, PayCO allows point refunds for a small fee. After a refund is requested, the amount (minus this fee) is deposited into the user’s account.
PayCo Security
PayCO ensures the security of its transactions and data through multiple certifications and security measures. It complies with PCI-DSS (Payment Card Industry Data Security Standard) and is further reinforced by its backing via the banking system.
PayCO employs advanced security measures, including encryption, two-factor authentication, and real-time transaction monitoring, to protect merchants and customers from fraud and data breaches. Additionally, requiring a passcode for all payments increases safety, reduces the risk of unauthorized transactions, and lowers the likelihood of returns or chargebacks.
However, users should remain vigilant about security risks. In 2022, a significant security issue was reported where a leak potentially allowed malicious apps to be installed as trusted applications. Although no direct attacks on the PayCO app were reported, NHN, the managing company, proactively took measures to enhance security and prevent future threats, ensuring safety.
Why eCommerce Merchants Should Consider PayCO
Wide User Base
PayCO is one of the most popular payment platforms in South Korea, with millions of active users. By integrating PayCO, merchants can tap into a large, established customer base. Being a well-recognized and trusted brand, PayCO can add credibility to eCommerce merchants among South Korean consumers, encouraging them to make purchases.
Thanks to the PayCO Campus Zone, PayCO is also popular with university students. Although this system is offline-based, many users in their early 20s already have the app installed, making it easier for eCommerce merchants to reach and engage with this demographic.
Repeat Customers
PayCO frequently partners with merchants to offer promotions and discounts, driving traffic to the merchant’s site and increasing sales. Additionally, PayCO’s loyalty programs reward customers for using the platform, encouraging repeat purchases and fostering customer loyalty. According to PayCO’s marketing site, merchants have reported a high conversion rate of over 60% when running coupon payment promotions targeting dormant customers.
Integrating PayCO through KOMOJU unlocks an access to partnering up with PayCO to offer promotions and discounts to gain South Korean online sales.
Cost-Effectiveness
Merchants pay nothing to use PayCO as a payment method for their customers’ purchases. Instead, PayCO charges consumers a nominal fee each time they use their virtual card to purchase online or in person at participating locations. This arrangement makes PayCO an attractive option for merchants, as they can offer a popular and secure payment method without incurring additional costs.
However, the application process for PayCO can be strenuous, especially if you cannot read or speak South Korean. This is where KOMOJU can help eCommerce stores navigate the process and integrate other South Korean payment apps, making it easier for merchants to leverage PayCO and other local payment solutions.
Integrating PayCO via KOMOJU
Integrating PayCO onto your eCommerce store requires applying through the PayCO merchant website, which demands an understanding of South Korean and the mobile payment industry.
This process can be time-consuming and divert focus from core business activities.
KOMOJU simplifies this by handling the necessary forms and documents, saving time and reducing errors. Its Shopify, Salesforce ECommerce Clouds, Magento and other EC Platform integrations as well as API support seamless integration of PayCO and other South Korean payment methods like Toss and KakaoPay and carrier billing options such as LG U+ and SK Telecom to the eCommerce site. KOMOJU also provides ongoing technical support to ensure smooth integration and operation.
- Sign Up with KOMOJU: Create an account on the KOMOJU website and access the testing environment straightaway.
- Application Assistance: Complete an English application process on KOMOJU including applying for PayCO.
- Integration: Once approved, connect KOMOJU and your eCommerce via EC Platform or API to integrate PayCO and other South Korean payment methods, including credit cards, mobile wallets, and carrier billing.
- Pay nothing until a sale is made. With KOMOJU, there is no initial set up cost or monthly fee but only processing fee for your sale.
Summary
Integrating PayCO into your eCommerce store is crucial for operating in South Korea, where it enjoys widespread use and trust, especially among university students. However, the application process can be challenging and time-consuming, particularly for those unfamiliar with the language and market. KOMOJU simplifies this by providing integration and ongoing support in English as well as by providing easy to integrate payment solutions for eCommerce sites to, save time and reduce errors.
PayCO is essential for eCommerce success in South Korea, and KOMOJU helps you achieve that, allowing you to focus on your core business activities.
Ready to integrate PayCO?
Find out PayCO’s settlement currencies and processing fees on the PayCO payment method page. If PayCO is the right payment method to offer your customers, sign up on KOMOJU to offer your customers a secure and convenient payment option!
If you’re unsure if PayCO is the right payment method for your eCommerce site, why not talk to our payments expert to learn more about PayCO and other South Korean payment methods?
FAQs
Below are frequently asked questions about PayCO.
Yes, PayCO is an eWallet service in South Korea. It is a mobile payment and digital wallet platform that allows users to make online and offline payments, transfer money, and manage various financial services through a single app.
To use PAYCO, you need an ID-verified South Korean cell number. This means it is typically available to citizens or long-term residents with an Alien Registration Card (ARC).
Yes, minors can use PayCO. It accommodates individuals without credit cards, including minors. However, PayCO does require parental consent to use the service
Yes, PayCO can be used outside of South Korea through global partnerships and collaborations, such as with Incom Japan and a consortium for cross-border payments. However, transactions are currently only completed in KRW.
We help businesses accept payments online.
