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Card and bank billing

South Korea — Specialized Credit Finance Business Act right to refuse instalment payment

NationalKRDerived or secondary source

Republic of Korea

Rule id
billing.kr-scfba
Version
1.0.0
In force from
January 13, 1998
Last read against its sources
August 5, 2026
Countries bound
South Korea

In plain language

What this regime says.

Korea gives an instalment purchaser something most countries do not: a statutory right to stop paying the CARD ISSUER when the seller has not performed. Above that sits a free statutory mediation procedure run by the Financial Supervisory Service.

Who is covered

Holders of Korean-issued credit cards, and for the instalment right, purchases made on instalments above the prescribed threshold.

What you get

A defence against the issuer for the unpaid instalments, free dispute mediation, and the ordinary scheme chargeback route in parallel.

Where claims go wrong

  • Paying off the instalments to protect your credit record and only then complaining. The right is a right to refuse payment; once paid it is much harder.
  • Exercising the right by telephone. It has to be provable.
  • Treating the FSS mediation as slow and going straight to court. Mediation is free and the FSS decision carries real weight.

Authority

Every citation,
with its pinpoint.

A claim that cites “EU law” gets filed. A claim that cites Article 7(1)(c) gets answered. These are the exact coordinates this entry rests on.
  1. 여신전문금융업법 (Specialized Credit Finance Business Act), Art. 16-2Specialized Credit Finance Business Act of the Republic of KoreaArt. 16-2 — a credit card member may refuse to pay the outstanding instalments to the card issuer where the seller has not performed
  2. 금융소비자 보호에 관한 법률 (Financial Consumer Protection Act)Act on the Protection of Financial Consumers of the Republic of Koreain force 25 March 2021 — suitability, explanation and unfair-conduct duties, and the financial dispute mediation route

Sources

Where a figure is indexed, converted or published by a regulator rather than fixed in the instrument, the provenance is recorded separately. Anything marked as a modelled estimate is exactly that — a model, not a statutory number.

What it imposes

Clocks, defences and the ladder.

A rule module builds these while it evaluates, because a limitation period depends on which forum is open to you. What follows is the structure this regime produces — deliberately with no dates and no figures, because those belong to your facts rather than to the law.

The clocks it starts

  • Card scheme dispute window (commonly 120 days)The scheme window is short and it is the one that closes first. It runs from the transaction or, for undelivered goods and interrupted services, from the date delivery or performance was due. The domestic routes below run much longer, so a closed scheme window is a reason to hurry, not a reason to stop.Filing window

What it entitles you to, beyond money

  • A reasoned written decision from the institutionA decision naming the clause or rule relied on is the thing that unlocks everything above it, and it is an obligation rather than a favour in every regime in this file.Art. 16-2 — a credit card member may refuse to pay the outstanding instalments to the card issuer where the seller has not performed
  • Reversal or refund of the disputed amount where the claim succeedsWhat that is worth depends on the route: a scheme dispute reverses the transaction, a conduct regulator can require the institution to put you back in the position you would have been in, and a court or ombudsman can go further and cover consequential loss.
  • Blocking further payments to the same merchantAsk for this in the same letter. Recovering what has gone does not stop what is coming, and a recurring authority survives a successful dispute unless you cancel it separately.

What the other side will say

Each of these is a refusal this regime lets a counterparty attempt, paired with the answer to it. Reading them before you write is worth more than any amount of polish on the letter itself.

"The merchant is abroad, so there is nothing we can do"

high likelihood

The institution treats a cross-border transaction as outside its reach and refers you to the merchant's own country.

What answers it

Your counterparty is the institution that debited your account, and it is regulated where you are. The card schemes operate cross-border disputes as a matter of routine — that is most of what the scheme rules are for. Ask the institution to state, in writing, which rule it says prevents it from raising a cross-border dispute.

"The transaction was authenticated with your OTP/PIN, so you authorised it"

high likelihood

The institution treats a one-time password or a PIN entry as conclusive proof that the cardholder consented.

What answers it

Authentication proves that a credential was used, not that you consented to that particular payment. Ask for the authentication log, the device and channel used, and the merchant identifier. Where the credential was obtained by deception, or where the institution ignored its own fraud-monitoring signals, the analysis changes — and in several regimes here the burden of proving authorisation sits on the institution, not on you.

여신전문금융업법 (Specialized Credit Finance Business Act), Art. 16-2 — Art. 16-2 — a credit card member may refuse to pay the outstanding instalments to the card issuer where the seller has not performed

Silence, indefinitely

high likelihood

The complaint is acknowledged and then simply never answered, which in practice defeats more claims in this region than any substantive argument.

What answers it

Treat silence as a refusal and escalate on that basis. Write once more, state the date of your complaint and the reference, say that you are treating the absence of a decision as a refusal, and copy the regulator or redress body named in this result. A file that has gone to the regulator gets answered.

Where to take it next

  1. Written complaint to the institution that debited youAddress it to the complaints or consumer-protection unit, not to a branch. Ask for a reference number and a written decision with reasons, and say what outcome you want in one sentence.Claim directtypically 30 days
  2. Scheme chargeback, in parallelAsk the issuer to raise a dispute under the card scheme reason code that fits the facts. It is faster than any regulatory route, it costs nothing to run alongside, and a refusal decides nothing about your legal rights.Claim directtypically 45 days
  3. The Financial Supervisory Service (FSS) and its Financial Dispute Settlement CommitteeThe FSS operates a statutory financial dispute mediation procedure that is free to the consumer. It is the standard route for a card dispute the issuer has refused, and it is used heavily. File after the issuer has given its answer, or after it has failed to give one. This body will look at your individual case, so file it as a case: dates, amount, reference numbers, and one sentence saying what you want done.Regulatortypically 90 daysofficial page
  4. Civil or small-claims proceedings against the merchant or the institutionThe last rung, and in several countries here the cheapest one — consumer courts and small-claims procedures in this region are frequently free or nearly so and do not need a lawyer. Use it when the sum is worth it and the regulator route has produced nothing.Small claimstypically 180 days

Documents

What this regime can produce.

Every one of these is a document you send yourself, in your own name. Duesday never writes to anybody on your behalf and is never anyone’s agent.

The same claim type elsewhere

Card scheme chargeback rules (Visa, Mastercard, American Express, Discover)SCHEMESupranational — party states varyVisa Core Rules and Visa Product and Service RulesConfidence: mediumPSD2 — unauthorised transactions and direct-debit refunds (Directive (EU) 2015/2366)EUSupranational — 30 countriesDirective (EU) 2015/2366 (PSD2)Confidence: highNorway — Financial Contracts Act 2020 and FinansklagenemndaNONational — NorwayLov om finansavtaler (finansavtaleloven), LOV-2020-12-18-146Confidence: mediumRussia — Federal Law 161-FZ on the National Payment System and the financial ombudsmanRUNational — RussiaФедеральный закон от 27.06.2011 № 161-ФЗ «О национальной платежной системе», ст. 9Confidence: mediumSwitzerland — Financial Services Act ombudsman affiliation and the Swiss Banking OmbudsmanCHNational — SwitzerlandFinancial Services Act (FinSA / FIDLEG), SR 950.1Confidence: mediumTürkiye — Bank Cards and Credit Cards Law No. 5464 and the Consumer Arbitration CommitteesTRNational — TürkiyeBanka Kartları ve Kredi Kartları Kanunu No. 5464Confidence: mediumConsumer Credit Act 1974 s.75 (and s.75A) — creditor joint and several liabilityGBNational — United KingdomConsumer Credit Act 1974, s.75Confidence: highCanada — payment card codes of conduct, provincial consumer protection and OBSICANational — CanadaCode of Conduct for the Payment Card Industry in CanadaConfidence: medium

Other rights in the same countries

Korea — securities class actions and injunction-only consumer group litigationKRNational — South KoreaSecurities-Related Class Action ActConfidence: lowRepublic of Korea — Consumer Dispute Resolution Standards (KFTC), air transportKRNational — South Korea소비자분쟁해결기준 (공정거래위원회 고시), 별표 II — 항공업Confidence: mediumRepublic of Korea — KORAIL delay compensation under its passenger transport terms (여객운송약관)KRNational — South KoreaKORAIL 여객운송약관 (Passenger Transport Terms and Conditions), made under the Railroad Service ActConfidence: lowRepublic of Korea — Korea PostKRNational — South Korea우편법 (Postal Service Act) of the Republic of KoreaConfidence: lowSouth Korea — Act on Consumer Protection in Electronic CommerceKRNational — South Korea전자상거래 등에서의 소비자보호에 관한 법률 (Act on the Consumer Protection in Electronic Commerce)Confidence: mediumSouth Korea Personal Information Protection ActKRNational — South KoreaPersonal Information Protection Act (Act No. 10465), Arts. 35–37, 39Confidence: lowSouth Korea — rental deposit (주택임대차보호법 (Housing Lease Protection Act))KRNational — South Korea주택임대차보호법 (Housing Lease Protection Act)Confidence: low

Does this one reach your facts?

The engine runs every regime that could apply at once and reconciles them, rather than making you guess which page to read.

Run your factsBack to the catalogue

Not a law firm. Not legal advice. You send it yourself. This page describes a law; it is not advice about your situation and no outcome is promised.