South Korea’s Jeju Island will begin paying grandparents a monthly stipend of around $200 for time spent looking after their grandchildren, as local governments experiment with new ways to support childcare and address the country’s rapidly declining birth rate.
The programme, set to begin in March, will pay grandparents who care for young children instead of relying on formal childcare services, according to public broadcaster KBS. The initiative was approved by the Jeju provincial assembly, and was being implemented after a similar programme proved successful in Seoul.
A February survey by the Seoul government found that 99.2 per cent of grandparents providing childcare were satisfied with the programme, while 99.5 per cent said they would recommend it to others.
According to a report by Korea JoongAng Daily, 5,466 people benefited from the allowance in Seoul by the end of 2025.
Seoul began the “grandchild care allowance” programme in 2023, and pays families 300,000 won ($204) per month when grandparents or other relatives provide at least 40 hours of childcare each month.
To be eligible for the policy, the families need to have children aged between two to three years old, and the household income could not be higher than 150 per cent of the national median. The children must belong to households facing childcare shortages, such as dual-income families, single-parent households or families with multiple children. In calculating eligibility, authorities apply a 25 per cent deduction to the combined income of dual-income couples.
The initiative reflects a shift in how childcare is now organised in South Korea, where rising living costs and changing work patterns have made grandparents an increasingly important source of support for young families. “I want to give my parents money for taking care of my children, but I’m glad the city is supporting them on my behalf,” a parent identified as Jeong told The Korea Herald.
As dual-income households have become more common and childcare expenses have risen, grandparents have increasingly filled gaps left by limited daycare availability. A policy review by the Seoul Foundation of Women and Family last year found that maternal grandmothers made up 54 per cent of supplementary caregivers in households participating in the programme, followed by paternal grandmothers at 36.4 per cent, while grandfathers accounted for less than 10 per cent of caregivers.
Parents also named several reasons they relied on grandparents; 48 per cent said they did not fully trust professional childcare workers, 46.4 per cent pointed to a lack of emergency childcare options, and 45.6 per cent said managing childcare alone was difficult.
Ma Chae Sook, deputy mayor for the women and family office in Seoul, said: “Beyond easing financial burdens, the grandchild care allowance is also helping children’s healthy development and growth by providing emotional stability through family care.”
The subsidy is part of a wider childcare support programme launched by Seoul mayor Oh Se Hoon in 2023, which includes parental-leave payments, emergency childcare services and, creating city-run indoor playgrounds known as “kids’ cafés”.
Policies aimed at easing childcare have become a priority for governments across east Asia grappling with a severe demographic crisis. After nearly a decade of steady decline in the birth rate, South Korea recorded a rise in 2025.
Last year, 254,500 babies were born, up 6.8 per cent from the previous year and the largest annual increase since 2007. The total fertility rate, a measure of how many children a woman is expected to have in her lifetime, rose from 0.75 to 0.80, returning to the 0.8 range for the first time in four years.
Officials said it is difficult to confirm, but government incentives have likely contributed to the rise in births.
“When I received cash benefits, such as a voucher worth 2m won [$1,362] from the government after my first child, I felt as if the burden of having a second child wouldn’t be as heavy as I had expected,” a woman surnamed Kim, who gave birth to her second child last December, was quoted as saying by Korea JoongAng Daily.
“It was hard to get my first child into a day care centre, but once I became pregnant with my second child, my first child received priority for admission, which made enrolment easier.”
The reliance on grandparents also shows the change in how young children are cared for as more mothers enter the workforce. According to a survey by the ministry of education in 2025, children now enter institutions such as daycare centres or kindergartens at an average age of 19.8 months, down sharply from 30 months in 2009.
The average monthly cost of child-rearing also went up to 1.116m won ($757.6), crossing the 1m won mark for the first time since the government began tracking the figure two decades ago.
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