South Korea to automatically deposit unclaimed lottery winnings via app

South Korea is set to implement a new system that will enable lottery winners who purchased paper tickets to have their winnings automatically deposited into their accounts. Starting July 18, individuals can register their paper lottery tickets by scanning the barcode into a mobile payment application, such as Payco. This new measure aims to simplify the process for claiming prizes and reduce the amount of unclaimed winnings.

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Starting July 18, paper lottery tickets purchased at retail stores can be registered by scanning the barcode into a simple payment app (Payco), and unclaimed winnings will be automatically deposited on the day the payment deadline arrives.

Under the previous system, winnings from paper lottery tickets could not be directly linked to an individual's identity, unlike tickets purchased online. Consequently, any prizes not claimed within the one-year validity period were automatically transferred to the national lottery fund. This often meant that many winners, particularly those winning smaller amounts, never received their prize money.

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In the past, unlike internet purchases, it was impossible to verify the identity of those who bought physical tickets at retail stores, so winnings that winners did not claim by the expiration of the statute of limitations (1 year from the payment start date) were returned to the fund.

In 2023 alone, the amount of unclaimed lottery winnings reached a significant 58.1 billion won (approximately $42 million USD). The majority of these unclaimed prizes were from the fourth tier (50,000 won) and fifth tier (5,000 won) winnings, suggesting that many people may have overlooked or forgotten about smaller prizes.

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Even if you register your ticket in the simple payment app, if you bring the physical lottery ticket to a bank or lottery retailer within the one-year payment period, you can receive the winnings first.

While the new system offers automatic deposits, the lottery committee advises winners to retain their physical tickets. If a winner presents the physical ticket at a bank or lottery retailer before the claim deadline, they will receive their prize money first. This is to prevent a situation where a third party might claim the prize using a lost or found ticket. Therefore, winners are urged to safeguard their paper tickets until the prize money is securely deposited or claimed.

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Because a third party may receive the winnings by bringing a lost paper ticket, you must carefully manage the physical lottery ticket so that it is not lost until the day before the payment deadline.