See More on Facebook

Business

Japan turns to smartphone payments

Businesses, consumers increasingly turn to smartphone payments as modus operandi.


Written by

Updated: February 25, 2019

More and more businesses are introducing cashless payment services via smartphones, with quick, easy methods such as scanning QR codes encouraging the spread of these payments. However, the field is getting crowded, which will lead to various issues.

Just a few seconds

At Bic Camera’s Ikebukuro main store in Toshima Ward, Tokyo, on Saturday, one customer paid for his shopping via the PayPay smartphone payment service. The 49-year-old man from Kawaguchi, Saitama Prefecture, bought a tripod, and received 20 percent back in points.

“I can buy things at a lower price than with cash, and the bill is settled in an instant,” the man said.

Payment systems using QR codes are essentially the same among their various providers.

At the cash register, the customer tells the cashier which service they want to use and opens the corresponding app on their smartphone. A QR code and a bar code are displayed on the screen.

The clerk scans the QR code or bar code with a terminal, and two or three seconds later a message arrives on the smartphone containing such information as the amount paid and the name of the store. This completes the payment.

There is also a method in which the customer scans a QR code displayed by the store. The purchase made Saturday at the Bic Camera store with PayPay was conducted this way.

Users register such information as a bank account or credit card number with the app. In the case of a credit card, payment is made later; with a bank account the purchase amount is immediately deducted.

“Hardly any of my friends in China carry a long wallet around anymore,” a 24-year-old female graduate student from China said. She expressed hope that QR payments would spread in Japan.

What triggered expansion?

The Osaifu-Keitai service from NTT Docomo Inc. was one of the forerunners among smartphone cashless payment services. Suica and other electronic money cards provided by transportation companies can also be used through smartphones.

One factor that has slowed the spread of such services was that business establishments needed special terminals or peripherals to read electronic data from smartphones.

The smartphone payment services that are increasingly popular these days read such things as QR codes and bar codes. With these systems, business establishments can complete payments with a smartphone or tablet terminal and the bar code reader attached to a cash register, so there is no need to have specialized terminals.

This makes the payment services easy to introduce for businesses such as independently operated eating and drinking establishments, as well as very small to midsize retailers.

Drawing in customers

Different providers are competing over such elements as reward points and additional functions, seeking to draw in customers.

Line Pay, the service offered by the free communications app Line, allows users to split their bill at eating and drinking establishments and elsewhere. They can also send money to friends. Already 1.3 million shops and other businesses have joined the service.

About 60 regional and other banks are participating in the J-Coin Pay service to be introduced by Mizuho Bank in March. The aim is to have at least 300,000 business establishments participating within a few years and at least 6.5 million users.

One of J-Coin Pay’s selling points is that when money transferred to a smartphone from an account is returned to the account, there is no fee for the transfer.

PayPay held a “¥10 billion point-back campaign” at the end of last year, which received a significant response. The second edition of this campaign will begin this month, in a bid to increase PayPay’s user base even further.

Each provider is trying to devise ways to use points to their advantage.

The spread of smartphone payment services using QR codes and other methods has just gotten started. According to trial calculations by the JMA Research Institute Inc., such payments are expected to reach ¥600 billion in fiscal 2019. This represents only about 1 percent of the approximately ¥60 trillion to be spent via credit cards.

In fiscal 2023, the amount of smartphone payment purchases is expected to expand to about ¥8 trillion, on a level with about ¥5 trillion spent via electronic money in fiscal 2017.Speech



Enjoyed this story? Share it.


The Japan News
About the Author: The Japan News is published by The Yomiuri Shimbun, which boasts the largest circulation in the world.

Eastern Briefings

All you need to know about Asia


Our Eastern Briefings Newsletter presents curated stories from 22 Asian newspapers from South, Southeast and Northeast Asia.

Sign up and stay updated with the latest news.



By providing us with your email address, you agree to our Privacy Policy and Terms of Service.

View Today's Newsletter Here

Business

More changes friendly to foreign investors on way in China

China is courting more FDI as their cash reserves run lower. China will roll out more measures friendly to foreign investors, including further removing business restrictions and leveling the playing field for foreign businesses, to foster a more enabling business environment and attract overseas investment. The decision was made on Wednesday at a State Council executive meeting chaired by Premier Li Keqiang. Meeting participants decided to open up more areas. Restrictive measures outside the national and FTZ negative lists on foreign investors’ market access will be consolidated. Restrictions will be lifted on the business scope for those foreign-invested banks, securities companies and fund management firms that are already operating in China. Policies on foreign investment in the automobile industry will be refined, including giving equal treatment in market access to domestic and foreig


By China Daily
October 18, 2019

Business

Japan, Toyota eye Thailand as R&D, manufacturing hub

Meanwhile Toyota chairman Takeshi Uchiyamada said his company is currently beefing production facilities in Thailand, aiming to build over 5 million units by 2025. Industry Minister Suriya Juangroongruangkit was recently in Japan to discuss business and investment opportunities with existing and future partners, including Toyota Motors, which aims to produce 5.5 million automobiles in Thailand by 2025. After signing a memorandum of understanding with the Japan-Thailand Economics Corporation Society (JTECS) and Toyota Motors Co Ltd, Suriya said his ministry will use this agreement to boost the production of automobiles and improve the robotic industry in Thailand. “This MoU will bring us closer to the Thailand 4.0 target,” he said. “We also aim to establish 1,400 system integrators within four years to facilitate hardware and software needs of corporate client


By The Nation (Thailand)
October 1, 2019

Business

Three companies with offices in Singapore linked to forest fires causing haze

Haze has closed thousands of schools across Southeast Asia and has been responsible for several deaths. The haze is back. And as forest fires rage on in Indonesia, a Singapore connection has surfaced. Three Indonesian firms with offices in Singapore have been linked to the haze-belching fires. One company, Hutan Ketapang Industri, sealed off by the Indonesian authorities after fires were discovered on its land, has links to Singapore-based Sampoerna Agri Resources. The other two – pulp giants Asia Pulp and Paper (APP) and April, have also been linked to the haze-belching fires by Indonesian news site foresthints. Both have offices in the Republic. Singapore’s National Environment Agency (NEA) said it is monitoring the current haze situation closely, although it has not taken any action against firms under the Republic’s Transboundary Haze Pollution Act this year. T


By The Straits Times
September 25, 2019

Business

India bans e-cigarettes

The decision has been met with criticism and charges of favouritism. The Union Cabinet’s move on Wednesday clearing an ordinance for banning production, import, distribution and sale of electronic cigarettes and proposing a jail term and fine for its violators evoked mixed reactions among a section of Delhi doctors and other stakeholders. The Centre’s decision was slammed by trade bodies and certain stakeholders related to e-cigarettes, who reportedly alleged that it was a “draconian” move taken hastily in the interest of the conventional cigarette industry. They also charged that the government was depriving people of a safer alternative to smoking. Dr Gyandeep Mangal, senior consultant in Respiratory Medicine, Sri Balaji Action Medical Institute, said, “We are glad with the ban on e-cigarettes by Union Cabinet as these are as harmful as regular cigarettes. It is true that e-cigarette doesn


By The Statesman
September 19, 2019

Business

Carrie Lam assures investors Hong Kong can rebound from protests

Written by the Associated Press as appearing in the Straits Times. Hong Kong Chief Executive Carrie Lam has told investors at a Belt and Road forum that the semi-autonomous Chinese territory can rebound from months of protests, despite no sign that the unrest will cool down. Mrs Lam voiced confidence at Wednesday’s (Sept 11) forum that rifts can be mended through government plans for dialogue and upholding the so-called “one country, two systems” policy that gives Hong Kong some freedoms not enjoyed on the mainland. She said Hong Kong’s “indomitable resilience” will see the city through the conflict. Mrs Lam’s promise last week to axe an extradition Bill that sparked demonstrations failed t


By The Straits Times
September 12, 2019

Business

Nissan board pushes out Saikawa after disclosure of improper compensation

The embattled company is facing major structural changes on the back of two scandals. Nissan Motor Co. announced Monday that President and Chief Executive Officer Hiroto Saikawa will resign, effective Sept. 16. The company’s board requested his resignation in the wake of a revelation that he had improperly received compensation, and he accepted the request. The automaker aims to choose a successor by the end of October. Meanwhile, Chief Operating Officer Yasuhiro Yamauchi will serve as acting CEO until then. “I have considered that my mission was to restore ties with Renault and improve earnings,” Saikawa said during a press conference Monday night at Nissan headquarters in Yokohama. “I have considered that if a successor system is established, I should start handing over my duties.” The successor will be chosen by the company’s nomination commi


By The Japan News
September 11, 2019