Coupang Faces Backlash Over Data Breach Compensation Plan

Controversy Surrounds Compensation Method

South Korean e-commerce giant Coupang has announced a massive Rp 19.70 trillion compensation plan for the 33.7 million users affected by its recent data breach. The company will provide each affected user with a 50,000 won Coupang voucher, sparking widespread criticism from lawmakers, consumer advocacy groups, and the public.

Critics argue that the voucher system restricts consumer choice by limiting redemption to Coupang's own platform and services. Choi Min-hee, a member of the National Assembly and chair of the Science, ICT, Broadcasting, and Communications Committee, criticized the plan, stating that the vouchers are for services that are "rarely used." The Korea National Council of Consumer Organizations echoed these concerns, suggesting that the compensation plan trivializes the severity of the data breach while promoting additional spending on the Coupang platform.

Background and Parliamentary Scrutiny

The data breach incident prompted Coupang founder Kim Bom to issue a public apology and commit to accelerating the compensation process. However, Kim declined to attend a parliamentary hearing scheduled for the following Tuesday and Wednesday, citing other commitments. The parliamentary session is expected to scrutinize Coupang's handling of the data breach and the controversial compensation plan.

Implications for Consumer Trust

The controversy highlights growing concerns about data privacy and corporate accountability in South Korea's rapidly expanding e-commerce sector. As one of the largest e-commerce players in the country, Coupang's response to the data breach will likely set a precedent for how similar incidents are handled in the future. The company's decision to offer vouchers rather than cash compensation has raised questions about its commitment to consumer welfare versus its business interests.