• Source:JND
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Weird facts: South Korea has unveiled a record cash handout of 31.8 trillion won (around Rs 2.19 lakh crore) to its people in a huge economic stimulus push to revive depressed domestic consumption and counter economic slowdown. The "livelihood recovery consumption coupon" scheme will be implemented nationwide from July 21 to Sept 12, providing immediate cash benefits to all those registered as citizens and some foreign residents and refugees who are eligible.

Who Are Eligible For The Cashback?

In the plan, all those South Korean citizens registered up to June 18 will get 150,000 won (approximately Rs 9,150) through credit/debit cards, prepaid cards, or government-issued local gift certificates. To cover regional inequalities, people living outside the capital area, Seoul, Gyeonggi Province, and Incheon, will receive an extra 30,000–50,000 won, based on their location.

Low-income families, single-parent households, and those on Basic Living Allowance will receive higher cheques:
• 300,000 won (about Rs 18,300) for low-income families and single-parent households.
• 400,000 won (about Rs 24,400) for those on Basic Living Allowance.

A second phase from September 22 to October 31 will give an additional 100,000 won (around Rs 6,000) to the lowest 90% income group, income-screened based on national health insurance data. Most foreign residents are excluded, but the following exceptions apply:

• Foreigners registered on a Korean citizen's resident record and under national health insurance.
• Permanent residents (F-5 visa), marriage migrants (F-6 visa) and, for the first time, refugees (F-2-4 visa) are eligible on specified conditions.

The move comes after a historic 2024 Constitutional Court judgment that ruled it was unconstitutional to exclude refugees from past COVID-19 payments.

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How To Apply For South Korea's Cash Coupon?

Applications open both offline and online between July 21 and September 12. Funds will be placed on cards or as local gift certificates that expire November 30. The unused balance will be recovered. The coupons can only be used in the resident's immediate locality and at small firms such as restaurants, beauty salons, grocery stores, and local stores with yearly revenues below 3 billion won. Expenditure at big chain stores, departmental stores, international luxury brands, duty-free stores, and big online delivery services is banned, a measure to promote local, independent businesses. The big chains such as Starbucks and Olive Young are excluded, but cross-ownership franchises like Daiso will be allowed to accept the coupons if they are individually owned.

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Why The Huge Payout?

South Korea's audacious cash stimulus is in response to sagging consumer confidence, flagging retail spending and world trade headwinds. The administration of President Lee Jae Myung believes inserting cash into people's pockets will kick-start local consumption and help revive struggling small businesses. President Lee Jae Myung, a long-time believer in universal basic income, has switched to a more focused plan following fears about fiscal sustainability. As mayor of Seongnam and governor of Gyeonggi, Lee promoted blanket payments to citizens. Today, he tells Yonhap that the new cash coupons aim at stimulating local purchases rather than comprehensive welfare.