Commercializing a won-denominated stablecoin could cut merchants' payment processing fees by as much as 5 trillion won ($3.6 billion) a year, according to a new analysis.
The National Assembly Budget Office estimated in a report titled "The Impact of Stablecoins on Financial Markets and Policy Implications" that if a won stablecoin replaces card payments, merchants would save between 370 billion won and 5.15 trillion won annually, financial industry officials said on the 9th.
The report based its calculations on roughly 1,225 trillion won in domestic credit and debit card spending last year, varying the fee rates for cards and stablecoins as well as the share of card payments displaced. Under a conservative scenario, it assumed fee rates of 1.1% for cards and 0.5% for stablecoins. The baseline scenario used 1.3% and 0.3%, while the optimistic scenario applied 1.5% and 0.1%.
If discounts and promotions push won stablecoins to displace as much as 30% of existing card payments, annual fee savings would reach 5.15 trillion won under the optimistic scenario. Even under the more realistic baseline scenario, the savings would be substantial. If 10% of card payments shift to stablecoins, merchants would save an estimated 1.23 trillion won a year. At a 30% replacement rate, that figure rises to 3.68 trillion won.
Stablecoins can offer payment services at lower fees than cards because they compress the steps involved in payment, clearing and settlement. Transaction records and asset transfers occur together on the blockchain, reducing the cost of verifying transaction details and settling funds through card companies and banks.
"For card companies, the introduction of a won stablecoin could put pressure on fee income," the National Assembly Budget Office said. "But along with the decline in card payments, related costs such as card points and mileage programs could also fall somewhat."
