Bank of Korea Launches Phase 2 of 'Project Han River,' Pilots Treasury Payments with Deposit Tokens

The Bank of Korea has begun the second phase of its digital currency pilot, 'Project Han River,' using deposit tokens for government payments like EV charging subsidies.

This initiative aims to establish a low-cost payment system, which could save small businesses a significant amount in transaction fees compared to traditional card payments.

After a brief pause, the project reactivates South Korea's digital currency roadmap, aligning it with global trends in tokenized assets and central bank digital currencies.

The Bank of Korea has officially launched the second phase of its digital currency initiative, "Project Han River."

At its core, this project is about tackling high payment fees. In South Korea, small merchants often pay between 0.4% and 1.45% in credit card fees. Deposit tokens, which are digital currencies issued by commercial banks, offer a compelling alternative. By facilitating direct transfers, they could potentially reduce these fees to near zero. For a small business with a monthly revenue of 50 million KRW, this could mean saving over 6 million KRW annually, a significant boost to their bottom line.

This second phase marks a strategic restart after the project was briefly paused in 2025. The revival was made possible by a few key developments. First, the Bank of Korea provided a clear policy signal in late 2025 that the project would resume, restoring momentum. Second, a successful demonstration of an AI-powered automated payment system in early 2026 proved the technical feasibility of advanced use cases. Third, and most crucially, the project's scope was smartly refocused. Instead of pushing for broad commercial use immediately, Phase 2 centers on a government pilot program: disbursing treasury funds for EV charging infrastructure. This provides a guaranteed, low-risk use case that alleviates the cost and operational concerns previously raised by commercial banks.

This initiative doesn't exist in a vacuum; it's part of a global trend. Central banks and financial authorities worldwide are exploring similar concepts. The Bank for International Settlements (BIS) has proposed a "Unified Ledger" that combines central bank money, tokenized deposits, and other assets on a single platform. The European Central Bank (ECB) is advancing its Digital Euro project, and the Hong Kong Monetary Authority (HKMA) is already in the second phase of its e-HKD pilot. By moving forward with deposit tokens, South Korea is ensuring its financial infrastructure remains aligned with these international standards, paving the way for a more efficient and programmable financial future.

Deposit Token: A digital currency representing a claim on a commercial bank deposit. It is issued by the bank and is designed to be a stable and reliable form of digital money for payments.
Programmable Payments: Payments that can be embedded with rules or conditions. For example, a subsidy voucher that can only be spent on specific goods at certain stores before an expiration date.
Unified Ledger: A conceptual financial market infrastructure proposed by the Bank for International Settlements (BIS) that aims to bring central bank money, commercial bank money, and tokenized assets onto a single, shared programmable platform.

Bank of Korea Launches Phase 2 of 'Project Han River,' Pilots Treasury Payments with Deposit Tokens

The Bank of Korea has begun the second phase of its digital currency pilot, 'Project Han River,' using deposit tokens for government payments like EV charging subsidies.

This initiative aims to establish a low-cost payment system, which could save small businesses a significant amount in transaction fees compared to traditional card payments.

After a brief pause, the project reactivates South Korea's digital currency roadmap, aligning it with global trends in tokenized assets and central bank digital currencies.

The Bank of Korea has officially launched the second phase of its digital currency initiative, "Project Han River."

Deposit Token: A digital currency representing a claim on a commercial bank deposit. It is issued by the bank and is designed to be a stable and reliable form of digital money for payments.
Programmable Payments: Payments that can be embedded with rules or conditions. For example, a subsidy voucher that can only be spent on specific goods at certain stores before an expiration date.
Unified Ledger: A conceptual financial market infrastructure proposed by the Bank for International Settlements (BIS) that aims to bring central bank money, commercial bank money, and tokenized assets onto a single, shared programmable platform.