Coupang to Pay $1.1 Billion in Compensation to Users After Data Breach

South Korea’s biggest online retailer is opening its wallet in a major trust reset.

Coupang is making one of the costliest trust-repair moves in South Korean tech history, pledging more than $1.1 billion in customer compensation after a major personal data breach shook millions of users.

The company announced Monday that it will roll out a compensation plan worth 1.685 trillion won ($1.1 billion) to customers affected by the incident, which was disclosed in late November. According to Coupang, the program is aimed at restoring confidence after the breach raised widespread concern about personal data security.

Coupang said the compensation will apply to about 33.7 million accounts that received a breach notification, including both current and former customers. Payments will be issued sequentially starting Jan. 15, with all eligible users receiving purchase vouchers valued at 50,000 won. The vouchers can be used across Coupang’s main shopping platform and its food delivery, travel, and luxury product services.

In its announcement, Coupang said all users, regardless of membership status, will receive the same compensation. Customers who closed their accounts after learning of the breach are also included. The company said it will notify users by text message and allow them to check eligibility directly through the Coupang app once the program begins.

Harold Rogers, interim CEO of Coupang Korea, said the company’s leadership recognizes the distress caused by the incident and described the compensation as a necessary step toward accountability.

“All of Coupang’s executives and employees are deeply reflecting on how much concern and anxiety the recent personal information leak has caused our customers,” Rogers said. He added, “We have prepared a compensation plan as a responsible measure for our customers.”

Rogers said the company intends to use the incident as a turning point in how it treats customer trust.

“This incident will be an opportunity for Coupang to deeply practice ‘customer-centricity’ and fulfill its responsibilities to the end, transforming into a company that customers trust,” he said. “I once again deeply apologize to our customers,” according to the Coupang.

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Fallout from the breach

The compensation announcement comes after a turbulent few weeks for Coupang. The data breach, discovered on November 18, triggered public criticism, regulatory scrutiny, and leadership changes. Former CEO Park Dae-jun resigned earlier this month following the incident.

Coupang founder and chairman Bom Kim also issued a separate apology a day before the compensation plan was announced, saying he was devastated by customer disappointment and admitting the company failed to communicate clearly in the early stages of the breach.

Coupang has said it’s cooperating with authorities and that it has recovered the leaked customer information through coordination with the government. The company has maintained that the data was not distributed or sold externally.

As one of South Korea’s most widely used online platforms, Coupang now faces the challenge of convincing millions of customers that the breach will not be repeated.

For a look at how data breaches can ripple beyond e-commerce, read TechRepublic’s coverage of the 700Credit data breach, which exposed sensitive consumer data and raised fresh concerns about how companies protect personal information.