Cashless payments in Japan - statistics & facts
Japan is well-known for its technological advancements, but when it comes to cashless payments, it lags behind its neighbors and other economies. Cash is still king in Japan, but digital payment usage is steadily gaining traction. Digital payments made up 39.3 percent of the private consumption expenditure in 2023, almost reaching the government’s target of 40 percent by 2025.
Credit cards remain the most widely used digital payment method in Japan, not only for in-store purchases but also for online shopping. They accounted for over 83 percent of the cashless payment value in 2023, followed by QR code payments, electronic money, and debit cards. In terms of payment volume, credit cards have lost share to QR code payment services, which have become increasingly popular in recent years. Used as a payment option for small amounts in convenience stores and supermarkets, QR code payments have recently overtaken contactless e-money as the second most popular digital payment option.
The government has actively promoted cashless payments in recent years. A major step towards expanding the use of non-cash payments was the cashless campaign and point reward program, launched in October 2019 along with a consumption tax hike. Cashless payments further received a boost from the impact of the COVID-19 pandemic. This has resulted in the share of cashless payments in Japan rising from 24.1 percent in 2018 to 39.3 percent in 2023.
In April 2023, the government lifted a ban on digital wage payments, allowing employees to receive salaries in the form of digital money via non-bank fund transfer service providers. As more consumers use digital payments in their everyday lives and the government continues to promote a cashless society, cashless payment usage in Japan is likely to expand in the coming years.
Most used cashless payments methods
Digital payments include all types of payments that do not require the exchange of cash, such as card payments and mobile payments. Various digital payment options are available to consumers in Japan, ranging from credit cards and debit cards to electronic money and smartphone payment services.Credit cards remain the most widely used digital payment method in Japan, not only for in-store purchases but also for online shopping. They accounted for over 83 percent of the cashless payment value in 2023, followed by QR code payments, electronic money, and debit cards. In terms of payment volume, credit cards have lost share to QR code payment services, which have become increasingly popular in recent years. Used as a payment option for small amounts in convenience stores and supermarkets, QR code payments have recently overtaken contactless e-money as the second most popular digital payment option.
Promotion of cashless payments
Japanese consumers have long held a preference for cash, which is considered a safe and reliable payment method. When it comes to digital payments, many are concerned about the potential leakage of their private information and overspending. On the other hand, consumers consider the convenient payment process and reward programs to be the most attractive aspects of cashless payments.The government has actively promoted cashless payments in recent years. A major step towards expanding the use of non-cash payments was the cashless campaign and point reward program, launched in October 2019 along with a consumption tax hike. Cashless payments further received a boost from the impact of the COVID-19 pandemic. This has resulted in the share of cashless payments in Japan rising from 24.1 percent in 2018 to 39.3 percent in 2023.
In April 2023, the government lifted a ban on digital wage payments, allowing employees to receive salaries in the form of digital money via non-bank fund transfer service providers. As more consumers use digital payments in their everyday lives and the government continues to promote a cashless society, cashless payment usage in Japan is likely to expand in the coming years.
