Among the 87.6 billion won of local currency used in Uijeongbu, South Korea, in 2023, the amount spent on private education was 21.8 billion won (25%), making it the second highest after general and convenience restaurants (24.9 billion won, 28%). Even when looking at the range from 2019 to 2022, the top item for local currency usage was Korean food (51.7 billion won), followed by cram schools (22.3 billion won). When combined with art and physical education institutes (13.6 billion won), foreign language institutes (6 billion won), and other institutes (7.5 billion won), it approaches 50 billion won. However, butcher shops (12.5 billion won) and agricultural, livestock, and fishery products (11.4 billion won), industries where local currency should ideally be more utilized, did not make it into the top five.
The flow of local currency, which should be used in small businesses and traditional markets, towards the academy is not limited to just certain areas. According to Lee Yong-ho, a member of the National Assembly from the People Power Party in Gyeonggi Province, on the 14th, among the total local currency payments of 42.148 trillion won in Gyeonggi Province in 2023, academy fees accounted for 9.686 trillion won (22.9%), ranking second. This represents an increase of 3.5 percentage points from 2022 (19.4%). The situation is similar in Seoul. From 2020 to September of last year, 19.6% (7.285 trillion won) of the local currency used was spent on private education.
Academies are also encouraging the use of local currency. Promotional phrases such as "the top place to use local currency is the academy" can be easily encountered. Even large academies with over 70 locations nationwide have registered as affiliated stores that accept local currency. The monthly tuition for this academy ranges from 520,000 to 720,000 won. Considering the preference for famous and large academies, it is difficult to simply argue that "because academies are also small businesses, there is no problem."
Local currency benefits increase during the Lunar New Year in January and Chuseok in September. To alleviate the burden on ordinary citizens during the holidays and boost sales for traditional markets, local governments raise discount rates. Suwon city in Gyeonggi Province decided to raise the discount rate to 20% this month, while Uijeongbu city also increased the discount rate to 10% only during the holiday period. When purchasing 1 million won in local currency, one can spend around 1.1 million to 1.2 million won.
However, there are concerns that increasing local currency benefits only boosts sales for academies and hospitals and pharmacies. Local governments' hopes that citizens will use local currency to purchase agricultural, livestock, and fishery products at traditional markets before holidays are not materializing.
According to a report titled "Analysis of the Impact of Changes in Local Currency Policy on Consumer Activation" published in September 2023, the sectors with the most significant fluctuations in local currency payments were food, academies, and medical health in Busan. This indicates that when local currency benefits are expanded or reduced, the consumption of local currency in these sectors also tends to increase or decrease. Ultimately, increasing local currency benefits under the pretext of supporting small businesses only serves academies and hospitals.
In August 2022, when cashback benefits were reduced, all age groups in Busan significantly decreased their local currency consumption on medical health and academies by the largest margin (29-57%). Conversely, when cashback benefits were expanded in September, the month of Chuseok, local currency consumption focused on food, academies, and medical health increased by 37-43%.
The research team that prepared the report noted, "The use of Dongbaekjeon has deviated from its original purpose of increasing sales for small and self-employed businesses, focusing instead on cashback benefits primarily used in high-cost venues like medical and academy sectors." They indicated that this means it is not providing tangible help to local small businesses and self-employed individuals, suggesting that differentiated application of cashback benefits by business type is necessary.
Some argue that as general and convenience restaurants rank first for local currency usage, there is a positive effect on the increase of small business sales. However, experts point out that even this is benefiting 'popular restaurants' located in vibrant commercial districts. It has been confirmed that local currency can be used at restaurants that reportedly generate annual sales of several billion won, a franchise restaurant with 14 locations in one area, and gourmet spots where it is necessary to wait over an hour to get a reservation. Seok Byeong-hoon, a professor at Ewha Womans University, stated, "The use of local currency is limited to specific sectors, and even that tendency exists only in places where conditions are better."