South Korea expands digital payment pilot to 500,000 wallets.
South Korea’s Financial Services Commission approved the second phase of Project Hangang, a central bank digital payment experiment based on CBDC. The maximum number of user wallets will increase from 100,000 to 500,000, and the number of participating banks will rise from seven to nine.
Expanded testing could begin in September, Decrypt reports. The limit applies to wallets, not unique users. Participants will not directly own CBDC; instead, they will use deposit tokens issued by commercial banks for payments.
Regulator Increases Limits
In the second phase, the storage limit will increase from 1 million to 10 million won per wallet. The total transaction limit will rise from 5 million to 100 million won.
For individuals and sole proprietors, transfer limits will be set at:
up to 1 million won per transaction;
up to 5 million won per day.
For companies, limits will depend on the transaction method. Through internet banking, transfers can be up to 1 billion won per transaction and up to 5 billion won per day, while through mobile apps, the limits are 100 million and 500 million won, respectively.
The approved feature set will also include wallet-to-wallet transfers, biometric transaction verification, and automatic replenishment of deposit tokens. In the latter case, if funds are insufficient, the system will automatically convert the required amount from the user’s regular bank account.
For companies, remote wallet opening and the ability to issue cashier’s checks are provided. The list of acceptance points will expand to include small businesses and large enterprises.
Nine Banks to Join the Experiment
The seven banks from the first phase—KB Kookmin Bank, Shinhan Bank, Woori Bank, Hana Bank, Nonghyup Bank, Industrial Bank of Korea, and BNK Busan Bank—will be joined by Gyeongnam Bank and iM Bank.
The commission granted the two new participants the status of experimental financial service operators. For the other seven banks, the regulator adjusted the conditions of previously issued permits to align with the parameters of the second phase.
The first phase of Project Hangang was conducted from April to June 2025. Users opened approximately 81,000 wallets and conducted 114,880 transactions.
CBDC to Remain at the Banking Level
Project Hangang uses a two-tier model. The Bank of Korea issues wholesale CBDC for settlements between financial institutions.
Commercial banks create deposit tokens based on this infrastructure—a digital representation of funds already in clients’ accounts. Users pay in stores and transfer money using these tokens.
Thus, the deposit token remains an obligation of a specific commercial bank, while the CBDC is used for final settlements between financial institutions.
The second phase will also cover the execution of certain government expenditures. Smart contracts will allow deposit tokens to be transferred directly to recipients and set conditions for their use.
In July, South Korean authorities planned a pilot for tokenized government bonds in 2027. Settlements will be linked to wholesale CBDC within the Project Hangang infrastructure.
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