South Korea bank loyalty market to hit $2.6b by 2035

The consumer segment already holds the biggest slice of program revenue.

South Korea’s retail bank loyalty programme market is expected to grow from $1.2b in 2024 to $2.6b by 2035, according to a report by Spherical Insights & Consulting.

The market is forecast to grow at a compound annual growth rate of 7.28% from 2025 to 2035, supported by the continued shift towards digital banking and banks’ efforts to improve customer retention and engagement.

Around 90% of banking transactions in South Korea are now conducted online, according to the report. 

This has encouraged banks to use loyalty programmes that offer personalised rewards based on customers’ spending patterns, purchase history, lifestyle and financial activity.

South Korean banks have also expanded beyond traditional points-based schemes. Loyalty programmes are increasingly linked to mobile banking, artificial intelligence and other digital services, allowing banks to offer rewards based on individual banking behaviour and financial milestones.

The report said initiatives including South Korea’s Open Banking Framework and MyData project are also supporting the development of loyalty programmes by making customer data more portable across financial services.

Major banks including KB Kookmin, Shinhan and Hana use loyalty programmes as part of their retail banking and cross-selling strategies.

The business-to-consumer, or B2C, segment held the largest share of the market in 2024 and is expected to record significant growth during the forecast period. 

These programmes allow banks to offer benefits directly to individual customers through digital banking platforms.

Large enterprises also accounted for the largest share by company size in 2024. The report said larger banks are better placed to fund programme development, app integration, reward fulfilment and fraud controls.

However, the cost of developing and maintaining loyalty systems remains a constraint, particularly for smaller banks. Expenses include technology integration, incentive management and measures to prevent fraud.