🚨 People's Recovery Consumption Coupon: Nationwide Support Fund and Economic Boost Policy

Today Korean Social News | 2025.07.06

📌 Up to 550,000 Won 'People's Recovery Consumption Coupon' Starts for All Citizens…Different Support by Income

💬 The government will start giving 'People's Recovery Consumption Coupon' to all citizens from July 21st. First, everyone gets 150,000 won, and low-income families and basic welfare recipients can get up to 450,000 won more. From September 22nd, 90% of citizens (except the top 10% earners) will get an extra 100,000 won. You can choose to receive it as card points, local currency, or prepaid cards, and you must use it within 4 months. This policy aims to reduce living costs for families struggling with rising prices and economic slowdown, and boost the economy through increased spending.

Summary

• People's Recovery Consumption Coupon is government support money to help reduce living costs and boost the economy.
• All citizens get it, but the amount differs by income level - those in greater need get more help.
• You can receive it in different forms like local currency or card points, which also helps local economies and small businesses.

1️⃣ Definition

People's Recovery Consumption Coupon means government support money given to help citizens facing economic hardship and boost the economy through increased spending. Simply put, it's like 'pocket money' the government gives to people struggling with rising prices or economic downturn.

This is not just about giving away money. The goal is to create a positive cycle where people spend this money, which increases sales for businesses and small shops, making the whole economy more active.

💡 Why is this important?

• Directly reduces living costs for families struggling with rising prices.
• Boosts the economy by increasing spending during tough times.
• Helps local economies and small businesses through local currency use.
• Reduces income inequality by giving more support to low-income families.

2️⃣ Main Details and Features of People's Recovery Consumption Coupon

📕 Who Gets It and How Much

• All citizens get it, but amounts differ by income level. The recipients and amounts are:

  • 1st payment (from July 21): All citizens get basic 150,000 won.
  • Basic welfare recipients and near-poor families get extra 300,000 won, total 450,000 won.
  • Rural area residents get extra 50,000 won regional bonus.
  • 2nd payment (from September 22): 90% of citizens (except top 10% earners) get extra 100,000 won.
  • Maximum 550,000 won possible for basic welfare recipients living in rural areas.

• Income level is determined by health insurance fees. Income categories are:

  • Basic welfare recipients: Those receiving living or medical aid under Basic Livelihood Security Act.
  • Near-poor families: Not welfare recipients but income below 50% of median income.
  • Top 10% earners: High-income group based on health insurance fees.
  • Rural areas: Those registered as residents in township areas.

📕 How You Get It and How to Use It

• You can receive it in different ways for convenience. Payment methods include:

  • Card points: Added as points to your existing credit or debit cards.
  • Local currency: Receive as local currency issued by your region (like Gyeonggi Local Currency).
  • Prepaid cards: Get a separate prepaid card to use.
  • Mobile coupons: Receive as electronic coupons through smartphone apps.

• There are limits on where and when you can use it. Usage rules include:

  • Time limit: Must use within 4 months from payment date.
  • Where you can use: Most daily life businesses like regular stores, markets, restaurants.
  • Where you cannot use: Some department stores, large marts, online shopping, entertainment venues.
  • No cash exchange: Cannot convert to cash, must only use for purchases.
  • Expires if unused: Automatically disappears after deadline with no refund.

Main Issues with People's Recovery Consumption Coupon

1. Budget burden: Huge spending creates national budget pressure and questions about long-term sustainability
2. Effectiveness debate: Temporary spending increase but limited impact on fundamental economic structure improvement
3. Fairness issues: Debate about appropriate income standards and need for middle-class support
4. Inflation concerns: Excessive spending boost might increase prices even more
5. Administrative costs: Coupon issuing and management costs might offset support benefits

3️⃣ Expected Effects and Economic Impact

✅ Household Economy and Spending Boost Effects

• Expected to directly help household economies. Main effects include:

  • Four-person families can receive 600,000 to 2,200,000 won, greatly reducing living cost burden.
  • Especially helps low-income families and rural residents with more benefits to reduce income inequality.
  • Can be used immediately for necessary daily items and food costs.
  • 4-month usage period helps with planned household management.

• Expected to boost economy through increased spending. Main economic effects include:

  • Total payment of several trillion won expected to create significant spending increase.
  • Will directly contribute to increased sales for small businesses and self-employed.
  • Especially expected to increase sales in restaurants, clothing, daily goods and other life-related sectors.
  • When using local currency, can only be used within the region, creating strong local economic boost effects.

✅ Past Consumption Coupon Policy Results

• Can predict effects based on past similar policies. Major examples include:

  • 2020 COVID-19 emergency support payments increased consumption rates by over 10% in short term.
  • 2021 consumption coupons linked with small business new hope funds also contributed to local economic activation.
  • Regional consumption coupons using local currency increased local consumption rates by over 20% in many cases.
  • However, effects were temporary, and consumption tended to shrink again after payments ended.

• Similar effects can be seen in overseas examples. International situations include:

  • America's Economic Impact Payments brought immediate consumption increase effects.
  • Japan's special fixed payments also contributed to increased personal consumption in short term.
  • Germany's child bonus was effective for household income increase and consumption boost.
  • However, all countries also raised concerns about effect sustainability and fiscal health.

4️⃣ Related Terms Explanation

🔎 Local Currency

• Local currency is money that can only be used in specific regions.
• Local currency is alternative money that can only be used within specific regions (cities, counties, districts), issued to activate local economies and support small businesses. It exchanges 1:1 with regular money but cannot be used outside that region.
• Main features of local currency include: First, issued in various forms like cards, mobile, or paper. Second, usually provides 5-10% discount benefits or cashback. Third, usage restricted at large marts or department stores, mainly usable at small business stores. Fourth, circulates only within the region creating multiplier effects for local economy.
• Local currency is evaluated as a '3-win' policy bringing discount benefits to consumers, increased sales to small businesses, and local economic activation to local governments. Currently issued by most local governments nationwide, with Gyeonggi Local Currency being the most representative success case.

🔎 Economic Stimulus Policy

• Economic stimulus policy is government policy to activate sluggish economy.
• Economic stimulus policy refers to policies implemented by government to activate economic activity and promote growth when the economy is in recession or growth rate slows down. Mainly achieved through fiscal and monetary policies.
• Main types of economic stimulus policies include: First, fiscal expansion policies like increased government spending, tax cuts, cash payments. Second, monetary easing policies like interest rate cuts, quantitative easing. Third, social infrastructure investment like road, railway, communication network construction. Fourth, deregulation and investment promotion policies.
• Economic stimulus policies have short-term effects of increasing consumption and investment to activate economy, but long-term side effects like inflation pressure or increased fiscal deficit. Therefore, implementing at appropriate timing and scale is important, and should be combined with structural economic reforms to be effective.

🔎 Near-Poor Families

• Near-poor families are the income class just above basic welfare recipients.
• Near-poor families refer to those who don't qualify as basic welfare recipients under Basic Livelihood Security Act, but have income levels at 50% or below of median income and face economic difficulties. It means 'the class just above basic welfare recipients.'
• Main characteristics of near-poor families include: First, income is 50% or below median income but exceeds basic welfare recipient standards. Second, often cannot become welfare recipients due to asset or dependent support requirements. Third, economically difficult but relatively excluded from government support, in 'welfare blind spots.' Fourth, can receive some support like medical aid type 2, near-poor class self-support projects.
• Near-poor families are middle class between basic welfare recipients and general working class, important consideration in government welfare policies. Expanding support for this group plays key role in resolving welfare blind spots and strengthening social safety nets. People's Recovery Consumption Coupon also aimed to increase fairness through additional support for this class.

5️⃣ Frequently Asked Questions (FAQ)

Q: Do I need to apply separately to receive People's Recovery Consumption Coupon?

A: People's Recovery Consumption Coupon is basically given automatically without separate application. The government automatically calculates recipients and amounts based on resident registration address and health insurance payment records. However, you need to choose how to receive it (card points, local currency, prepaid cards, etc.), so you need to select the receiving method on related websites or apps. Basic welfare recipients or near-poor families may need qualification verification to receive additional support, so it's good to contact your local community center or district office. Also, rural area bonus is automatically paid based on resident registration address, so no separate application needed. If you should receive it but don't, you can contact the relevant local government or call center for confirmation.

Q: Can I exchange consumption coupons for cash to use?

A: People's Recovery Consumption Coupon cannot be exchanged or converted to cash. This is because the policy purpose is economic activation through consumption boost, preventing use for savings or loan repayment. Consumption coupons can only be used for purchasing goods or services at designated partner stores, and change cannot be received in cash. Usable places mainly include general stores, markets, restaurants, pharmacies and other daily necessity sectors, while department stores, some large marts, online shopping, entertainment venues are restricted. Also, there's a 4-month usage period from payment date, and if not used within deadline, it automatically expires with no refund. Therefore, it's good to use received consumption coupons for living expenses or essential item purchases in a planned way.