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Foreign consumers can browse but not buy on Korean platforms

Published: 29 Jul. 2025, 16:53 Updated: 30 Jul. 2025, 14:35

A Coupang delivery vehicle in a parking lot in Jung District, central Seoul, on June 3 [NEWS1]

Cumbersome registration and payment processes continue to hinder foreign consumers from buying Korean products online, limiting the expansion of Korea’s cross-border e-commerce market.

A 2014 controversy over the a winter coat dubbed “Cheon Song-yi coat” led to the abolishment of mandatory ActiveX — a Microsoft browser plug-in that was once required for online payments and identity verification — and digital certificate requirements, but a report by the Bank of Korea on Monday said that foreign consumers still face considerable barriers when shopping on Korean platforms.

The Cheon Song-yi coat became immensely popular among foreigners after it was featured in a hit TV series "My Love from the Star" (2013–14), featuring actor Jun Ji-hyun. After the drama aired, the coat gained massive popularity, especially among Chinese fans who tried to buy it online. But they were unable to complete their purchases due to Korea’s mandatory use of ActiveX plug-ins and digital certificate-based authentication, systems that were largely incompatible with foreign browsers and inaccessible to overseas users.

Koreans spent 8.1 trillion won ($5.8 billion) on direct overseas purchases last year, according to the central bank’s analysis of data from Statistics Korea.

These spending patterns also affected the rankings of online shopping platforms. As of January, the most visited was Coupang, followed by AliExpress in second and Temu in third place.

In contrast, spending by foreign consumers on Korean platforms reached just 1.6 trillion won, one-fifth the amount spent by Koreans on overseas platforms.

While the direct purchase market has grown consistently since 2017 with an average annual growth rate of 20.1 percent, the reverse — foreign purchases of Korean goods — grew only 14.7 percent annually and even declined between 2021 and 2022.

Coupang delivery vehicles in a parking lot in Jung District, central Seoul, on June 3 [NEWS1]

“Growing interest in Korean pop culture and beauty has not translated into e-commerce activity due to difficulties with signing up and making payments,” the report said.

Some large retailers such as Coupang Global and Musinsa Global have launched dedicated sites for overseas users, reflecting that demand. But the report noted that these measures fall short of meeting foreign consumers’ expectations for seamless shopping.

Most Korean e-commerce platforms require phone number verification tied to a domestic mobile number when creating an account, the report said.

"While it is not a legal requirement, domestic platforms commonly require users to verify identity using mobile numbers registered with a resident registration number," said Chu Seung-woo, deputy director of the Bank of Korea’s electronic finance team. "This practice has become an industry standard to prevent identity theft and enable targeted marketing."

Global platforms like Amazon and AliExpress, on the other hand, allow users to register using an email address or any mobile number, regardless of country, through one-time password authentication.

Korea also lags behind in payment systems. An industry survey found that only 3 to 4 percent of domestic online retailers accept foreign-issued Visa or Mastercard credit cards.

Digital wallets like PayPal and Alipay — which allow users to preregister or preload payment information — have become common elsewhere but remain uncommon on Korean platforms.

A person pays with a credit card at a self-service kiosk in Seoul on July 26, 2022. [YONHAP]

Platforms like AliExpress and Temu do offer Korean digital payments such as Naver Pay and Kakao Pay.

Foreign-issued card usage in Korea shows a stark gap between face-to-face and online transactions. Eighty-one percent of spending occurred in person, with only 19 percent made through non-face-to-face transactions, including cross-border e-commerce.

This is significantly lower than in other Asian countries such as China, where non-face-to-face transactions account for 62 percent, and India at 48 percent.

To address the issue, the report proposed enabling account creation using email or mobile number authentication, allowing global payment options and linking domestic systems to foreign simplified payment services.

"Cross-border e-commerce could provide new business opportunities for small- and medium-sized enterprises," Chu said. “If platforms adopt fraud detection systems based on AI, such as FDS, it will be possible to manage the risk of payment fraud.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY PARK YU-MI [[email protected]]