Financial authorities plan to cut credit-card processing fees for small merchants by as much as 1 trillion won ($880 million) next year, an industry source said Wednesday.
Financial authorities are expected to announce the plan next week after consultations with the ruling Democratic Party, according to the source.
Last year, the nation's eight credit card firms reported an income of 11.6 trillion won from commission fees.
In July, credit-card processing fees for small merchants with an annual revenue of between 300 million won and 500 million won were reduced by 0.7 percentage point to 1.3 percent per transaction.
For small merchants with an annual revenue between 200 million won and 300 million won, the processing fees were cut by 0.5 percentage point to 0.8 percent per transaction.
In the first half of the year, major credit card firms saw their combined earnings spike nearly 51 percent thanks to increased card usage and greater income from credit card loans.
The combined net profit of eight card issuers, including Shinhan Card Co., Samsung Card Co. and KB Kookmin Card Co., came to 810.1 billion won in the January-June period, up 50.9 percent from a year earlier, according to the Financial Supervisory Service.
The sharp rise was attributed to a combination of increased income from fees, earnings from card loans and decreased loan-loss reserves. (Yonhap)