Card point cash-outs reach 817 million won this month

Average user reclaims 13,000 won

Dormant points can cover property tax, funds and insurance premiums

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[Created using ChatGPT]
[Created using ChatGPT]

# "I used card points to help pay my July property tax bill." Kim, a 35-year-old office worker, had been consistently using a credit card that rewards a portion of each purchase as points, accumulating about 150,000 points. Rather than converting them to cash, she applied the points directly toward this month's property tax payment.

As the government pushes to reduce expiring card points by allowing conversion into local currency vouchers, interest in existing ways to use card points has grown. Consumers who used a card point cash-out service this month reclaimed an average of more than 13,000 won each. Card points can be converted to cash or used to pay national and local taxes, including property tax, drawing attention as a practical way to put dormant points to work.

According to the Korea Financial Telecommunications and Clearings Institute, card point cash-outs processed through its "Account Info" app between July 5 and Saturday totaled about 817.11 million won across 61,819 transactions. That works out to an average cash refund of roughly 13,000 won per user.

Consumers can check their points across multiple card issuers in one place through either the clearings institute's Account Info app or the Credit Finance Association's integrated card point inquiry system, then transfer the balance to a bank account of their choice. The actual volume of card point cash-outs is likely far larger, as the figures above exclude transactions processed through the Credit Finance Association's platform.

Most card issuers treat one point as one won, and conversions are possible starting from a single point. Depending on the issuer, the requested amount is deposited either in real time or on the next business day. Once a request is submitted, however, it cannot be canceled or corrected. Card points typically expire five years after they are earned, so checking balances regularly and using them before they lapse is advisable.

Card points that go unused and expire amount to around 100 billion won ($72 million) a year. According to the Financial Supervisory Service, a total of 501.8 billion won in card points expired across eight dedicated domestic card issuers over the five years from 2021 to 2025. The unused point balance held by card companies stood at 2.91 trillion won as of the end of June last year. It was against this backdrop that President Lee Jae-myung said on June 30, "It would be good to pursue a plan to convert these various types of points into local currency vouchers."

With July's property tax payment period now under way, a growing number of budget-conscious consumers are putting card points toward their tax bills. The clearings institute's Cardrotax platform lets users pay national and local taxes using credit card points. Even if a user's points fall short of the full tax amount, the system applies the points first and charges the remainder to the credit card.

On the Cardrotax website, users can navigate to the tax payment menu, enter the electronic payment number printed on their tax notice, and complete the payment using card points. One important caveat: once payment is confirmed, it cannot be canceled. This applies to both local and national taxes, and switching from a lump-sum payment to installments after the fact is also not permitted.

Points are increasingly being used for financial products as well, including funds and insurance premiums. Shinhan Card holders can use Shinhan My Points to pay the first installment when opening a new savings or time-deposit account at a Shinhan Bank branch or through internet banking. Shinhan Investment allows customers to buy funds with points, while Shinhan Life lets policyholders use points to pay initial and ongoing premiums on select products, including cancer insurance, term life insurance and children's insurance.


forest@heraldcorp.com