Expat Guide to Navigating Credit Cards in Korea

As an international resident, building a life in South Korea can feel complicated, especially managing finances. So let’s learn about getting a credit card in Korea. The personal experiences in the following blog post include E and F-visa holders in South Korea.

Getting a Credit Card May Feel Scary

Learning a new financial system while dealing with hidden aspects of culture and a new language may feel unfair and frustrating. The following blog post combines information sourced from 1) financial institutions and 2) lived human experiences. We hope the information provides a more complete picture of what getting a credit card in Korea might look like for international residents.

Building Credit with Credit Cards

Much like in other countries like the United States, an essential tool for building credit is a credit card. The following blog post walks you through different aspects of obtaining a credit card in South Korea. We look to explore types of cards, factors affecting eligibility, and types of credit cards.

If you would like to know more about the history of credit cards in Korea, you can read the following report published in English 2011 by the Korean Institute of Finance (KIF):

Understanding the South Korean Credit System

Before obtaining a credit card, take time to learn more about the credit system in South Korea. The country operates on a comprehensive credit scoring system, similar to other countries, where your financial activities are tracked. The Korean credit score may impact your eligibility for different types of credit cards, home loans, or car loans. Read the South of Seoul blog post: Managing Your Korean Credit Rating

Once you are more familiar with the credit rating system in Korea, start looking at which credit card you might be interested in. You will need to choose a financial institution and then a type of credit card. Let’s look into these concerns in more detail.

Choosing a Bank or Credit Company

Each year international residents have increased access to credit cards in South Korea. The country boasts a range of financial institutions offering credit cards to foreigners, including major banks like:

• Hana,
• KB Kookmin
• Shinhan
• Woori

Additionally, there are non-bank credit card companies like:

• Samsung Card
• Lotte Card
• Hyundai Card

The above-mentioned financial institutions may have different eligibility requirements and documentation to open an account. Let’s look at such issues next.

Choosing a Credit Card as a Foreigner

As an international resident in Korea, you may want to look at the following factors when considering where to apply for a credit card.

Korean Credit Card Eligibility Factors

International Residents are eligible to apply for credit cards in South Korea but often face unique requirements. Factors banks look at when considering credit cards for international residents in Korea may include:

• Visa Duration: A visa with a duration of at least one year.
• Type of Visa: Some visas such as A3 visas for the US military may not be eligible for credit cards in South Korea.
• Time Left on Visa: You may need to apply with more than 6 months remaining on your visa.
• Time in Korea: The longer you live in Korea the more access you often have to credit.
• Amount in Accounts: If you have substantial savings in a Korean account you may be more likely to have increased access to credit.
• Proof of Employment: This may come in several different formats including but not limited to: (1) Contract or letter from your employer, (2) proof of National Health Insurance (NHIS), and (3) documentation that you filed taxes the previous year (obtained through hometax.go.kr)
• Proof of Residence: A copy of your rental agreement.
• Type of Employer: For example, if you have a public school contract you are more likely to get a credit card compared to someone who works for a hagwon.
• Amount of Credit: If you already have a credit card in South Korea, another financial institution may not want to offer you another credit card.
• Credit History: This ties back to time in Korea. They want to see that you have a financial history.
• Country of Origin: If you come from a country sanctioned by South Korea, this may impact your access to credit.

Generally, financial institutions will not consider offering a credit card to anyone unless they have worked in South Korea and had a bank account for at least 3 months. This includes Korean nationals who have been working abroad for a length of time. Wait at least three months to apply for your first credit card in Korea. It will likely take longer, but wait at least 3 months.

Basic Requirements and Documentation

When you apply for a credit card you usually need to supply the following documentation:

• Alien Registration Card (ARC): This serves as your identification.
• A Korean Bank Account: This should be obvious but we mention it anyway.
• Proof of Employment: Contract or letter from your employer (see above for alternative options)
• Income Proof: Recent pay slips or a bank statement. It’s often easiest to apply for a credit card at your bank since they keep your proof of income on record.
• Approval to Review Financial Information: You need to sign off on approval for the credit card company to review your financial data in South Korea.

Application Process

For international residents, applying for a credit card typically involves visiting a bank branch with all the necessary documents. Some banks recently started allowing online applications for foreigners, but not all have this established. For a long time, foreigners couldn’t apply online.

However, even if the credit card company allows applications by foreign residents, the online system may require proficiency in Korean. Assistance from a Korean friend or a professional service can be invaluable in navigating this process.

Personal Experience 1 (E Visa Holder with Hana and KB credit cards): I applied for my Hyundai credit card through KT store when renewing my phone contract. I knew that certain credit cards provided monthly discounts. I asked them which credit card would be the best for me. They pulled up all the different credit cards with KT discounts and I chose one. Then they did all the paperwork and signed me up online. Very easy. (As a side note, the Hyundai card is also the only Korean credit card accepted at Costco, but it’s one of the harder ones to get as an international resident.)

Personal Experience 2 (F Visa Holder with Hana and KB credit cards): My friend applied for her Samsung credit card at the tables next to the checkout counter at E-Mart Traders. The Samsung Card employees asked for her ARC, employment information, and bank details to input into their tablets. A few minutes later, she received a call directly from the Samsung credit card company to confirm and finalize details. Then, the Samsung Card table employees helped her download the Samsung Pay app to give her immediate access to her card and benefits. She was able to use her credit card via the app on the same day.

Credit Card Delivery

Credit Cards are not delivered through regular mail. A person may need to receive the card in person. Sometimes it must be the applicant. If you have a job where you can’t be home, make sure to have the card delivered to your job.

On occasion, if you aren’t home to receive the card in person, the delivery driver may call you to ask (in Korean, of course) if you would like them to leave the card in your mailbox. However, this practice is often case by case. The delivery person is responsible for you receiving your card and may not offer to leave your card in your mailbox for security purposes. If your delivery person doesn’t offer this, they may ask for a time frame when you will be home, so they can return later for delivery.

Credit Card Apps

Credit Cards are managed through apps. Anyone who uses a Korean credit card will need to learn how to manage their credit card and it’s going to be stressful.

English Language Interfaces

Some credit card companies in Korea have English-language apps for managing credit cards. For example, the Hyundai Credit Card app has an easy-to-use English language interface. However, sometimes the English version of the apps may not work well (Hyundai’s works fine) or not be available at all.

Using Credit Card with Korean Interface

As of 2024, new smartphones often have language translation built in. When you select text in the app you can directly translate things without taking screenshots. It’s heaven. You can see an example of this in the images below. This shows how the translation works with an iPhone.

If such translation doesn’t work, you can screenshot the banking app screen and use Papapgo to translate.

Credit Card Payments

Especially if you are from the United States, you need to understand that Korean credit cards assume you will pay them off completely every month. When the bill arrives, it will ALL be due. That’s the initial setting.

If you would like to pay for some purchases over time, you need to manually select those individual purchases and choose how many months you want to spread them over. Sometimes you also need to apply for this option.

Choosing Installment Payments at Checkout

Sometimes you can choose monthly installment payment options when checking out from a store. For example, when I pay over 100,000 KRW for groceries at Emart Traders they always ask, “How many installments?” At this point, I can break the payment over a few months if I choose. If you struggle with using the Korean language credit card apps, this can be the easiest time to set up your installment payments.

When I purchase large items like computers or airplane tickets, I often set the installment payments during checkout. Friends have even purchased used cars on their credit cards and spread the payments over a few months.

Helpful Korean Terms

• 일시불 [il-shee-bool] – lump sum payment
• 할부 [hahl-boo] – installments
• 개월 [gae-wuhl] – month.
  • This term is used as a counter. For example: 2 months or 2개월 [ee gae-wuhl]

Useful Aspects of Korean Credit Cards

We will update this over time because we keep learning about new uses for credit cards.

Credit Card / ATM Card

Some credit cards such as the KB Credit Cards, can also be set up as a debit card. This means you can access both your credit and your bank accounts with only one card. Keep in mind that you have to request this feature when setting up the credit card. We definitely recommend this option. It means you can use your credit card to make bank deposits and withdraw money from ATMs. We love having only one card.

T-Money Card

Some credit cards can also function as transportation cards like T-money so that you can simply tap your credit card for subways, buses, and taxis.

HiPass

You can also get a HiPass card attached to your Credit Card so that using the freeway is always easy. When I did this it made my life so much easier.

Additional Reading

Of course, you need to cross-reference our information with other articles. Here are blog posts we also recommend reading.

How Korean banks decide to give out credit cards

Korean Credit Card Guide for Foreigners

10 Best Credit Cards for Expats in South Korea

Conclusion

While obtaining a credit card in South Korea may seem daunting, it’s a feasible and beneficial step for expats. By understanding the requirements, choosing the right bank or credit company, and managing your credit card responsibly, you can enhance your financial flexibility and creditworthiness in South Korea. Remember, the key to successful financial management abroad is informed and cautious decision-making.