Money exchanges from Korean to Japanese currencies fell last month as the result of less demand for Japanese brands and travel to the neighboring nation amid soured relationship following the launch of trade embargoes from Japan.
According to local lenders, conversion into Japanese yen at Korea’s five major banks – Shinhan, KB Kookmin, Woori, KEB Hana and NH NongHyup – amounted to 22.5 billion yen ($213.5 million) in July, down 7.7 percent from a month ago and 8 percent from a year earlier.
The reduced demand for Japanese money in summertime goes against past trend as Japan has been one of the most popular destinations for Koreans during vacation and is timed with the launch of consumer boycott against Japanese brands after fallout over past issues developed into trade tensions.
Credit card spending by Koreans in Japan also dropped, in tandem with the decline in Korean travelers to Japan. Credit-financed spending at Japanese locations slipped 0.4 percent in the third week of July and dipped 19.1 percent in the following week, according to eight domestic card issuers.
In response to the decline in demand and nationalistic fervor, issuers are scaling back promotional events for shopping in Japan and instead launching marketing campaigns at home ahead of the 74th anniversary of Korea’s liberation on August 15.
Woori Card discontinued its discount event for shopping at Japan’s major shopping sites such as Don Quijote, Bic Camera and Family Mart outlets and instead offered a high-return savings product to market the Liberation Day.
OK Savings Bank is also offering a special savings product with a return rate of 1.815 percent and additional 0.1 percentage point reward offered to veterans.
By Kim Tae-sung and Lee Ha-yeon
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]