When people first encounter 신용카드 현금화 (credit card cashing), one of the first things they notice is the fee—often more than 10%. Naturally, many wonder why such services can’t offer lower rates, sometimes asking, “Can’t I find a company that charges less than 10%?” While the idea of saving money is understandable, it overlooks the true cost of operating a legitimate credit card cashing service. In today’s market, especially in 2025, fees that fall below the 10% threshold are not only unrealistic—they're potentially dangerous.
This article breaks down why standard credit card cashing fees exceed 10% and why choosing a service based solely on low fees can lead to financial risk.
Why Are Credit Card Cashing Fees So High?
The high fees associated with credit card cashing aren’t arbitrary. They reflect several layers of unavoidable cost:
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Merchant Fees: Every credit card transaction incurs a processing fee of about 2–3%, which goes directly to the credit card company. This is non-negotiable.
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Value-Added Tax (VAT): In South Korea, a 10% VAT is imposed on these transactions. That means before any business expenses are factored in, the transaction already faces over 12% in hard costs.
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Operating Costs: Legitimate companies must pay for:
- Staff salaries
- Office space
- Technology platforms
- Customer support services
- Regulatory compliance
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Risk Management: Chargebacks, fraud, and customer defaults are real threats. Businesses include an additional margin to absorb these risks. Without it, a few bad transactions could sink the company.
Altogether, these costs bring the industry average to between 15% and 25%. Any company offering far less is either cutting essential corners or operating under unsustainable—or fraudulent—conditions.
Current Market Ranges (2025)
Different types of cashing methods come with varying fee structures:
-
Gift Certificate Cashing:
Fee range: 5%–10%
Reason: Lower risk and a straightforward process. -
Small Payment Cashing:
Fee range: 10%–15%
Reason: Slightly higher complexity and handling risk. -
General Credit Card Cashing:
Fee range: 15%–25%
Reason: Greater exposure to fraud and operational complexity.
The consistency in these ranges shows that reputable businesses have aligned around realistic, sustainable pricing. When a provider offers “flat 5%” or “7% guaranteed,” it should be a red flag.
The Danger of Chasing Unrealistically Low Fees
It’s tempting to chase providers advertising sub-10% fees. The math seems simple—on a ₩1,000,000 transaction, saving even 5% equates to ₩50,000. But this logic doesn’t account for hidden dangers.
For instance, on a ₩500,000 transaction with a 7% fee:
- The provider earns ₩35,000
- Card processing eats up ₩15,000
- VAT takes ₩50,000
This results in a net loss of ₩30,000, not including rent, salaries, or tech costs. Such a model is unsustainable unless the provider is:
- Running scams
- Cutting legal or ethical corners
- Planning to shut down before the fallout hits
Common consequences of using such services include withheld funds, identity theft, or the company disappearing overnight. What starts as a way to save money can end in financial disaster.
How Reliable Companies Operate
Legitimate companies don’t promise miracles. Instead, they:
- Maintain transparent fee structures
- Offer secure and timely payments
- Provide customer education and guidance
Some even publish resources to help customers understand the process better, such as guides for handling 정보이용료 현금화 (information usage fee cashing) that warn against scams.
Bigger Transactions, Lower Percentages
One valid way to reduce your overall fee percentage is to increase the size of your cash-out. Since VAT and processing fees are fixed costs, their relative impact decreases as the transaction size increases.
Example:
- On ₩100,000: 15% fee = ₩15,000
- On ₩1,000,000: 13% fee = ₩130,000
While you pay more in absolute terms, the percentage cost is lower, making larger cash-outs more efficient.
Red Flags to Watch Out For
Before choosing a provider, always ask:
- Do they have a registered business number?
- Are there authentic, verifiable customer reviews?
- Can you find consistent third-party feedback?
- Do they request personal information that feels unrelated?
- Do they require upfront deposits?
If the answer to any of these is no, proceed with caution—or not at all.
The Hidden Cost of Mistakes
Using unverified or shady providers can have long-term consequences:
- Frozen or canceled credit cards
- Damaged credit score
- Stolen personal data circulating on the dark web
A single poor decision can tarnish your financial record for years. Saving 5% on a transaction isn’t worth risking your identity or credit standing.
Looking to the Future
As digital wallets, AI-powered fintech, and crypto integrations continue to evolve, credit card cashing may become more convenient. But the core costs—taxes, processing fees, operational overhead, and fraud risk—aren’t going away.
As long as those remain, expecting fees below 10% is unrealistic.
Final Thought: Peace of Mind Comes at a Price
The reality is simple: standard credit card cashing fees exceed 10% because they must. Any service offering less is either unsustainable or unsafe.
Rather than chasing deals that sound too good to be true, look for companies that are transparent, compliant, and reliable. In emergencies, paying a 15% fee for secure service is far better than risking everything for a deal that could collapse in moments.
Source: MyNewsGh.com
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