USD to KRW for business payments
A foreign business paying a supplier in Korea can send US dollars or convert to Korean won (KRW). Payments for ordinary trade are free under Korea's Foreign Exchange Transactions Act once the documents support them, so the choice turns on how the supplier invoices and what each route costs. The won floats freely, so a won invoice carries exchange rate risk until it is paid.
- The Bank of Korea (BOK) states that the daily fluctuation limits on the interbank exchange rate were abolished in December 1997, shifting Korea to a free-floating exchange rate system.
- The BOK states that payments for current transactions are freely permitted when documents certifying the reason for and amount of the payment are submitted.
- Nonresidents may hold nonresident free won accounts, and current transactions may be settled through them in the name of the person concerned or a foreign correspondent bank.
- Customer exchange rates are decided independently by each foreign exchange bank, revised in reference to the interbank spot rate, so the margin varies by bank.
- BOK-Wire+, owned and operated by the Bank of Korea, is Korea's main large-value payment system, and most retail payment systems are run by the Korea Financial Telecommunications and Clearings Institute (KFTC).
The Korean won at a glance
The Korean won (KRW) is issued by the Bank of Korea (BOK), the central bank. The BOK sets out how the regime developed. In February 1980 Korea moved from a fixed rate to a multiple-basket peg; in March 1990 it adopted the Market Average Exchange Rate System, under which the rate was set by supply and demand within daily limits; and in December 1997 the daily fluctuation limits were abolished, so Korea's exchange rate system became free-floating. Free-floating means the market sets the rate without a band.
| Item | Korean won |
|---|---|
| Currency code | KRW |
| Issuer | Bank of Korea |
| Exchange rate regime (BOK wording) | Free-floating since December 1997 |
| Main law | Foreign Exchange Transactions Act (FETA), with a presidential decree and regulations issued by the Minister of Strategy and Finance |
| Payments for current transactions | Freely permitted with documents showing the reason and amount |
| Large-value system | BOK-Wire+, owned and operated by the Bank of Korea |
| Retail payment systems | Mostly run by the Korea Financial Telecommunications and Clearings Institute (KFTC) |
Sources: BOK, Exchange Rate System; BOK, Relevant Legislation; BIS, payment systems in Korea. Checked on 29 October 2026.
Korean foreign exchange rules for trade payments
Korea regulates foreign exchange under the Foreign Exchange Transactions Act (FETA), which covers the exchange rate system, foreign exchange business, and the payment and receipt of foreign exchange. The BOK summarizes how it applies to ordinary trade:
- Current transactions are free. Payments for current transactions, such as paying for goods and services, are freely permitted as long as documents certifying the reason for and amount of the payment are submitted. Only some payments need prior confirmation from or notification to the BOK.
- Receipts are not restricted. The BOK states there is no specific restriction on receipts, but a transaction is regarded as a donation unless evidential documents are submitted. Your invoice and contract are what the supplier's bank needs.
- Unusual settlement methods are declared. Netting, third-party payments, payments outside the periods set by the ministry and payments that bypass foreign exchange banks are subject to declaration to the BOK or, in some cases, the designated bank.
- Large bank purchases are reported. Banks must in principle report any purchase of foreign exchange over US$20,000 per case to the National Tax Administration.
The third point matters most to a buyer. A payment from a company other than the buyer on the contract is a third-party payment, which can trigger a declaration on the supplier's side. Pay from your own company account.
How a KRW payment reaches a Korean supplier
Won held by nonresidents moves through specific account types. The BOK lists nonresident free won accounts, into which nonresidents may deposit foreign currency remitted from abroad and exchanged for won and the proceeds of current transactions with residents, and from which they may pay for won-denominated current transactions and convert back to foreign currency. The BOK also states that current transactions may be settled through nonresident free won accounts in the name of the person concerned or a foreign correspondent bank. A provider paying won to a Korean supplier on your behalf works through this structure.
Inside Korea, BOK-Wire+ handles large-value interbank settlement in real time, and KFTC runs the retail systems, including the giro system and the interbank shared network.
| Detail | USD by SWIFT | KRW payout |
|---|---|---|
| Beneficiary name | Supplier's registered name, exactly as on the account | Same |
| Account | The supplier's foreign currency account | The supplier's won account |
| Bank identifier | Bank name, branch and SWIFT code | Bank name, as the provider requests |
| Supporting documents | Invoice or contract showing reason and amount | Same |
| Settlement inside Korea | Supplier's bank credits the account | BOK-Wire+ or KFTC systems between banks |
Sources: BOK, Internationalization of the Korean Won; BOK, Payments and Transactions; BOK, Payment and Settlement Systems in Korea. Checked on 29 October 2026.
Confirm the supplier's bank code with our SWIFT code lookup before the first payment.
What converting USD to KRW costs
The cost of a dollar to won conversion has three parts: the mid-market rate, which is the midpoint between buying and selling prices at that moment; the margin, the difference between that rate and the one you are given; and the payment fee. The BOK explains that customer rates are decided independently by each foreign exchange bank and revised in reference to the interbank spot rate, so two banks can quote different won amounts for the same dollars at the same moment. The BOK's basic exchange rate, the volume-weighted average of the previous day's interbank trades, is a reference for tax and accounting, not a dealing rate.
Ask for the won amount the supplier will receive and compare it with the mid-market rate. If you send dollars, the supplier's bank applies its own customer rate when the supplier converts.
Helm is a financial technology company, not a bank. Its US dollar account services are provided by Bridge Building, Inc. (NMLS ID 2450917), a licensed money transmitter, with customer funds held at Lead Bank. A Helm account holds dollars in your company's own name and sends international payments to suppliers by SWIFT, or by local rails in the supplier's currency where available, with the rate, fee and expected arrival shown before you send.
Helm agrees pricing with each business in writing before the account opens, and shows the rate, the fee and the expected arrival before you confirm each payment. See how Helm pricing works.
Pay a Korean supplier in USD or KRW?
- Pay USD when the invoice is in dollars and the supplier gives a foreign currency account. The supplier converts at its own bank's customer rate or keeps the dollars.
- Pay KRW when the supplier invoices in won, for local services such as testing, logistics or a Korean agent, or when a small supplier quotes only in won. You carry the rate risk under a free-floating regime.
- Keep the payer and the contract aligned. Third-party payments and payments that bypass foreign exchange banks can require a declaration, so pay from the company named on the contract.
For the charges on the wire itself, see our guides to SWIFT charge codes and intermediary bank fees.
Open a Helm account
USD, EUR and GBP accounts in your company's name, with a named account manager.
Open accountQuestions
Is the Korean won free-floating?
Yes. The Bank of Korea states that the daily fluctuation limits on the interbank exchange rate were abolished in December 1997, shifting Korea to a free-floating exchange rate system.
Does Korea restrict payments to foreign suppliers?
Not for ordinary trade. The Bank of Korea states that payments for current transactions are freely permitted when documents certifying the reason and amount are submitted, and only some payments need prior confirmation or notification.
Can a foreign company hold Korean won?
Nonresidents may hold nonresident free won accounts, which can receive foreign currency remitted from abroad and exchanged for won, and from which they may pay won-denominated current transactions and convert back to foreign currency.
What is BOK-Wire+?
BOK-Wire+ is the Bank of Korea Financial Wire Network, Korea's main large-value payment system, owned and operated by the Bank of Korea.
Why do Korean banks quote different won rates?
The Bank of Korea explains that customer rates are decided independently by each foreign exchange bank and revised in reference to the interbank spot rate, so each bank sets its own margin.
What does Helm charge to pay a supplier in Korea?
Helm agrees pricing with each business in writing before the account opens, and shows the rate, the fee and the expected arrival before you confirm each payment.
References
- Bank of Korea: Exchange Rate System
- Bank of Korea: Payments and Transactions (Foreign Exchange Transactions Act)
- Bank of Korea: Relevant Legislation
- Bank of Korea: Internationalization of the Korean Won
- BIS CPSS: Payment, clearing and settlement systems in Korea (2011)
This guide is general information for businesses, not financial, legal or tax advice. Rules, fees and timings were checked against the sources listed on the review date and may change.