"200 Cards Refunded," "Switched to A Twosome Place"... On Starbucks Refund Day, Where Will the 400 Billion Won Go?

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[The Financial News] On the afternoon of the 1st, I visited a Starbucks store in Jung District, Seoul, and requested a refund for an anonymous Starbucks card loaded with 30,000 won. I had used 14,800 won, or 49.33% of the balance, which was less than half of the original top-up amount.
Under normal circumstances, it would not have qualified for a refund. Until now, Starbucks had allowed balance refunds only when more than 60% of the final top-up amount had been used.
That day was different. After checking the card balance, an employee immediately handed over 15,200 won in cash.
That was because Starbucks Korea moved to reassure consumers after the Tank Day controversy and decided to offer full refunds for Starbucks card balances from the 1st through the 14th, regardless of usage ratio.
The store was calm, but online activity was intense. On Social Network Service (SNS), users posted verification photos showing refunds made both online and in stores.
There were also small incidents. Some people brought more than 200 cards to stores and then turned back, while managers handling the extra refund work were heard sighing.
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The atmosphere in stores on the first day of refunds was calmer than expected. Some customers came in to get their card balances refunded, but there was no major crowding.
A store employee in Jung District, Seoul, said, "Because the number of customers has dropped significantly, we were able to process refund requests without much difficulty." The employee added, "But it is true that the extra work of checking card balances and counting cash for payment has made things harder."
While stores remained quiet, online communities and SNS were buzzing with refund verification photos.
One internet user wrote, "My father had his Starbucks card set to auto-reload. After the recent Tank Day incident, he asked me to switch to A Twosome Place, so I got the refund today and moved over."
Others shared reviews such as, "The process was simpler than I expected," "It was refunded immediately even though there was very little balance left," and "I canceled auto-reload first."
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At one store in Seoul, a customer who brought more than 200 Starbucks cards requested refunds but eventually left without completing the process.
Starbucks is currently processing refunds in stores only for anonymous physical cards that are not registered in the app. However, to keep store operations stable, it has limited refunds to 10 cards per transaction and 100,000 won per day.
At a store that actually received more than 200 physical cards, the line for orders grew longer as staff explained the daily limit to customers.
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The refund system has also revealed some minor loopholes.
For anonymous cards, the daily refund amount is capped, but some say it is difficult to enforce perfectly. For example, if someone has 100 anonymous 10,000 won cards, they could move from store to store and receive refunds within the 100,000 won limit.
In fact, there were 14 Starbucks stores within a 1-kilometer radius of The Financial News office. With only about an hour, it would theoretically be possible to move from store to store and get a large number of cards fully refunded in a single day.
Taking this into account, Starbucks has already prepared additional measures.
A Starbucks official said, "Starting on the 8th, anonymous cards can be converted into registered cards by verifying the holder's identity through a store QR code. Then, like app-registered cards, refunds can be sent directly to a bank account."
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What the industry is watching most closely is the size of the refunds.
Starbucks' prepaid balance, including unused coupons, is estimated at about 400 billion won. Industry sources say that even if only half is refunded, more than 200 billion won in cash could flow out.
A Starbucks official said, "To ensure cash payments for refund customers, we have allocated more cash than usual based on store size and the number of visiting customers."
Cash on hand refers to the cash a store keeps available for immediate use during business operations.
Signs of declining consumption are already appearing.
According to IGAWorks Inc.'s Mobile Index, Starbucks' weekly payment volume from May 18 to 24 came to 23.69 billion won. That was down 8.47 billion won, or 26.3%, from 32.16 billion won in the previous week. New app installations also fell by more than 20%.
With summer promotions fully suspended and card refunds now in full swing, the burden on Starbucks Korea and its parent company, Shinsegae Group, is expected to grow further.
y27k@fnnews.com Seo Yoon-kyung Reporter