Every 1 million won in consumer coupons distributed under Korea's livelihood recovery program last year generated approximately 430,000 won in additional sales for small business owners, according to a new analysis. The policy effect exceeded that of typical cash-based support, a result attributed to the coupon format, which restricted spending locations and usage periods while varying payment amounts by income level.
The Korea Institute of Public Finance (KIPF) released the findings Tuesday at a seminar titled "Livelihood Recovery Consumer Coupons: Verified by Data." The institute analyzed payment data from affiliated merchants of six card companies — Shinhan, Samsung, Hyundai, KB Kookmin, BC, and Hana — covering a sample equivalent to 74.2% of total credit card transactions in 2025, to estimate the short-term consumption impact.
The study found that the net effect on small business merchant sales, representing additional revenue growth, was 0.433 won per 1 won distributed. Based on this multiplier, the policy effect of the 13.52 trillion won in consumer coupons distributed last year was estimated at approximately 5.86 trillion won. The limited actual effect, despite the coupons being designed to be fully used within a set period, was attributed to recipients diverting their existing income to savings during the usage period.
By sector, sales increases per 1 million won in coupons were largest in other specialty retail at 56,700 won, followed by restaurants at 49,000 won, general retail at 37,700 won, and non-store retail at 36,900 won.
The institute analyzed that the transfer payment effect of the consumer coupons was substantial because the economic downturn had persisted for an extended period and larger differentiated amounts were distributed to low-income households, whose consumption accounts for a relatively high share of income.
However, the institute said similar policies should be pursued with greater caution in the future. Because the effect was observed under abnormal recessionary conditions, side effects such as inflationary pressure could be greater if the timing and target group are misjudged. The analysis emphasized the need to carefully review conditions including recipient eligibility and program scale.
The time required to recover the funds invested in consumer coupons through taxation was estimated at 25 years and 10 months. This calculation assumes that small business owners, having escaped temporary difficulties thanks to the coupon effect, will continue paying taxes over a long period.
"The consumer coupons had the effect of preventing long-term sales declines among vulnerable small business owners," said Jang Woo-hyun, director of the National Accounts and Fiscal Statistics Center at the Korea Institute of Public Finance. "To sustain this, additional government measures such as fundamental productivity enhancement must be put in place."
