Japan Tourism Agency will promote cashless payments

With an eye on helping inbound tourists make payments more conveniently, the Japan Tourism Agency plans to launch a programme to promote cashless payments, it has been learned.

As more cashless payment systems are introduced, such as the Alipay smartphone payment system that is rapidly spreading in China and other countries, the agency hopes inbound tourists in Japan will spend more, agency sources said.

Separately, the Niseko resort area in Hokkaido and some other tourism areas have introduced their own cashless payment systems, getting ahead of the government.

Under the agency’s programme, the government will subsidise part of the costs for introducing a cashless system in a tourist area when led by a local government or local shopping association as a whole, starting in fiscal 2019.

In addition, the agency will speed up the installation of free wireless internet access points as well as multilingual tourist guide boards. For both developments, revenue from the international tourist tax, also known as the departure tax, will be used. The tax started earlier this month.

According to the Ministry of Economy, Trade and Industry, the percentage of cashless payments stood at 18.4 per cent in 2015. This figure compares to 89.1 per cent in South Korea, 60.0 per cent in China and 45.0 per cent in the US, illustrating that cashless payment is not making much headway in Japan. It is not rare for an inbound tourist to be perplexed when a credit card is not accepted at a cashier.

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Consumption per inbound tourist has been declining in recent years. In 2015 when bakugai (“explosive buying” – coined after the spending power of Chinese tourists in Japan) shopping sprees for home appliances and daily necessities were drawing attention, consumption per visitor stood at 176,000 yen ($1,606.50 at the current exchange rate). However, the figure dropped to 153,000 yen last year.

“It is vital to develop a payment environment that doesn’t frustrate people,” an agency official said.

On the other hand, the Niseko ski resort, which is famous among inbound tourists, is introducing a cashless payment system across the whole area.

In November, resort facilities run by Tokyu Fudosan Holdings Corp group companies, as well as other resorts in the Niseko area, started a trial of a local cashless payment service called “Niseko Pay”. The service is currently offered to local residents but will be extended to foreign tourists from next season.

Retail stores and tourist facilities are rapidly introducing the Alipay service, to which more than one billion people have signed up worldwide. Currently in Japan, more than 50,000 shops accept Alipay payment, apparently feeling the positive impact of the payment system.

“Since we introduced the [Alipay] system, inquiries from inbound tourists have increased,” said a man who runs a tourism farm in eastern Saitama Prefecture.

In the Kansai region, West Japan Railway Co, Hankyu Corp and other railway operators in the region are offering IC card prepaid tickets for inbound tourists. THE YOMIURI SHIMBUN/ANN