BUSINESS Japan catching up with China in cashless payments

BUSINESS

Japan catching up with China in cashless payments

By Bai Yuanqi | People's Daily app

20:30, August 22, 2018

Japan cashless payment.jpg

A local customer shows QR code to make payment at a store in Tokyo, Japan on July 3, 2017. (File photo: VCG)

Japan will invest heavily in cashless payments, with a targeted digitized rate of 40 percent by 2025, though still lower than South Korea’s 90 percent and China’s over 60 percent in 2015, according to the Nikkei newspaper.

Despite strong technical support domestically, the nation tumbled through its cashless projects with traditional credit bonuses and coupons. This time, it pledges more direct financial stimulus to retailers and restaurants, with more popular payment methods like scanning QR codes that dominate in China.

The government will subsidize those firms aligned with its cashless plan and is considering to offer limited-time tax breaks to small and midsize companies that embrace digital payment options.

“The Japanese are sensitive to personal privacy and favor cash over credit cards," said Forben Yong Shu, the deputy director of Japan’s Financial Research Center of Japan.

In the global cashless society, QR codes are second to credit cards largely used in the West. China’s two internet giants, Alibaba and WeChat, extensively use the QR code.

But visitors from China and South Korea often feel embarrassed and disappointed in cash-only payments during their holidays in Japan, prodding local authorities to prioritize digital payments.

The boon of using alternative payments is huge, as Boston Consultancy estimates, the overhead Japanese financial agencies pay for managing cash payments remains high. Consumers will enjoy the convenience Chinese shoppers have.

More significantly, a cashless Japan can better serve foreign visitors at the 2020 Tokyo Olympic Games.

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