Korea's credit card approval volume hit all-time high last year

The annual card approval amount in South Korea exceeded 1,000 trillion won ($811.4 billion) for the first time ever.

This is largely because of "retaliatory spending" after the social distancing measures were lifted, especially in the lodging, food service, and travel industries. In particular, as the number of airline ticket purchases increased, the approval amount for travel expenditures took off by 60%.

According to the credit card approval figures in the fourth quarter of 2022 released by the Credit Finance Association on Tuesday, the last year's credit and debit card approval volume was 1,097.7 trillion won, an increase of 12.3% (120.6 trillion won) from the previous year.

The number of card approvals was also compiled at 25.7 billion cases, up 9.9% from the previous year.

On a quarterly basis, however, the card approval amount increased at an explosive rate by 14.8% and 15.1% year-on-year in the second and third quarters, respectively, before slowing down to 8.4% in the fourth.

"Due to the base effect of 2021, the amount of card approval in the second and third quarters rose so much that the amount of card approval reached 99.3 trillion won in May last year alone," the association explained.

Looking at the credit card approval volume by industry, the rising trend was most visible in the lodging and food service industries. Hotel and restaurant credit card approvals amounted to 38.2 trillion won for the year, up 19.9% (6.3 trillion won) from the previous year.

The travel industry surged 63.3% year-on-year from 2.4 trillion won to 4.9 trillion won. International travel restrictions have mostly been lifted, and the very low number of ticket purchases in 2021 in the wake of COVID-19 acted as a base effect, resulting in a sharp increase in ticket purchases in 2022.

Write to Jin-Woo Park at jwp@hankyung.com