According to the Korean Ministry of Home Affairs, the program will officially start from July 21 and last until September 12.
Each citizen residing in Korea as of June 18 will receive a one-time amount of 150,000 won (110 USD). This support will be transferred via credit card, debit card, prepaid card or gift voucher issued by local authorities. Deputy Minister of Home Affairs Kim Min-jae affirmed that the government will prepare carefully so that the expenditures can maximize their role in promoting consumption and supporting people in need.
In addition to the general allowance for the entire population, vulnerable groups will receive higher support. Near-poor households and single-parent families will be provided with 300,000 won (220 USD), while those receiving basic living allowances will be supported with 400,000 won (290 USD). Residents in rural areas received an additional 50,000 won to promote balanced regional development.
A second round of support is expected to take place from September 22 to October 31, with a payment of 100,000 won ($73) to 90% of people with lower incomes than the highest level. Beneficiaries will be determined based on the national health insurance premium, with detailed information to be announced in September.
The launch context of the program is that Asia's fourth major economy has just avoided a technical recession in 2024, after growth slowed in the second half of the year, including a downward quarter and a weak recovery quarter. The main cause is believed to be domestic political instability, culminating in President Yoon Suk Yeol being deposed for allegedly inciting a rebellion after he imposed temporary martial law in December.
New President Lee Jae-myung, sworn in on June 4, launched an economic stimulus package including issuing cash, issuing electronic cigarettes and committing to invest in AI infrastructure to boost growth.
However, some economists warn that these measures could increase inflation and negatively affect the long-term fiscal balance. The Korean Ministry of Finance plans to finance the stimulus package with new loans, with an estimated budget deficit of 4.2% and national debt reaching 49.1% of GDP.
