Who wants to grab a dirty bill?
How did COVID-19 change the cashless game?
Since April 7, Shinzo Abe, prime minister of Japan has declared a state of emergency for seven prefectures. The demand for travel has been sharply reduced by the Government “stay-home” requests. However, the growing thirst for digital services is making up for the losses. On the other hand, the most noticeable change is that the convenience stores (combini) and supermarkets workers started wearing masks and gloves, working behind a thick glass sheet after the state of emergency urging people to cut down person-to-person contacts by 70-80%. Wearing masks, staying home, washing hands daily, preventing hand-contact (no more handshake during this time). And, the Japanese have started to switch from physical payment (having cash) as their priority payment method due to the concern over viral infections.
The Development progress before the COVID-19 period
Traditionally, Japan is well known for being a cash-based country, despite its reputation as one of the homes of forward-thinking technology. According to the Ministry of Economy and Trade, the number of digital transactions in Japan is only 18.4% which is extremely low compared to other countries. To deal with it, according to Japantimes, since last year, the government of Japan has decided to push for cashless payments by progressing several policies with the goal of 40% of consumer payments being cashless by 2025. However, the share of cashless payments remains far too small, compared to China, the US, or European countries.
However, the concern of the Japanese over viral infections through the handling of cash has been promoting cashless payments, which leads to the remarkable rise of both domestic payment systems and International payment systems in Japan. We are talking about the rise of mobile payment, credit cards, and prepaid transportation cards. Froma Harrop, an American writer who is well-known for her unconventional approach and libertarian streak, has said that COVID-19 has accelerated this process for several reasons. Simply answer the question: Who wants to grab a dirty bill?
The rise of Cashless Payment systems in Japan
Thus, during the COVID-19, various cashless transaction forms in Japan had the chance to increase remarkably after the tax increase last year, both Domestic systems and International systems, from basic forms like IC cards (Suica, Passmo) to credit card and mobile payment systems. Pasmo and Suica cards were used initially only to swipe for public transportation—but later widely accepted as an efficient form of payment in Japan. After the cooldown of COVID-19, it is not surprising that the electronic version of these transportation cards is one of the most popular electronic payment forms in Japan.
Domestic systems such as PayPay, Rakuten Pay, Line Pay, etc are also making headway. They had also run various significant marketing campaigns during the CoronaVirus period, which provided additional benefits such as discounts and loyalty points in transactions. After the calm of the virus lately, now we can see tons of shopping shops start to hang the sign with the words “PayPay used here”. Hiroshi Mikitani, CEO of Rakuten Inc, also gives his comment with JapanTimes: “Smartphone-based payments are becoming popular among people who do not want to touch cash because of the pandemic.”
The advantages of E-payment are considered inevitable. The plus point first of all is the cashless method is going to protect yourself from the virus at the moment. Secondly, the customers can receive a 2% or 5% refund depending on where they shop. Moreover, the Japanese government considers cashless payment as the basic foundation of a more efficient financial system, in which the flow of money would be a lot smoother.
Thus, let’s check out some of the noticeable Cashless payments system forms in Japan. If you are a foreigner living in Japan and struggling with the Credit Card complicated registration system, check out J TRUST global card, which is exclusively designed for foreigners and has a lot of privilege policies at the moment!
- LINE Pay
- Rakuten Pay
- Google Pay & Apple Pay
- J TRUST Credit card <= here
- Rakuten Credit Card
- Amazon Credit Card
Prepaid transportation cards
Are you prepared for cashless Japan?
We’d love to know if you are an owner of a credit card, have you applied for a J TRUST Card? Let us know in the comments!