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Japan Cards & Payments Market Report
- Published Date: February 2023
JAPAN CARDS AND PAYMENTS REPORT
An expert analysis of the cards, payments and consumer banking market in Japan, with insightful commentary supported by appropriate data. Cash usage remains unusually high for such an advanced market, leaving a lot of transactions to be migrated to digital.
The unified QR-code system helps as do the interbank-transfer reforms underway, with fees reduced for the first time in four decades. Fintechs are proliferating in Japan, especially in partnerships, but are not yet in a position to challenge entrenched incumbents.
What is happening in the Japanese payments market?
The Japanese government, recognising that the country lags behind its neighbours, is pushing for cashless payments. It is a strategic goal that has benefitted from pandemic-driven changes to consumer behaviour and the banking industry's focus on digitalisation. Fintechs, albeit slowly, are being brought into the Japan payments clearing system.
What can we expect in cards and digital payments?
For such an advanced market, there are plenty of cash transactions to be migrated to digital. Some 38 per cent of the value of consumer transactions in 2022 were undertaken using cash. Healthy growth can be expected too when it comes to mobile payments with only a quarter of adults using this means of payment during 2022. The new QR standard should play a key role in this regard.
What about global players? What will they encounter?
Both at the point of sale and online, credit cards in Japan remain the most popular non-cash payment tool, with Visa leading JCB for credit cards in circulation and Mastercard investing in market visibility. Adyen and Worldline are now providing acquiring and processing services here.
How are other players and challengers faring?
Convenience is popular, with Japan's issuers and fintechs producing a host of solutions, but delays to interbank access for non-establishment players mean that digital solutions have yet to do the kind of heavy lifting that is becoming common in other markets throughout the region.
What you will learn from this report:
This report provides a detailed analysis of current market trends in Japan's cards and payments market with valuable insights into emerging trends. It gives an expert analysis of the payment markets operating in Japan and offers detailed intelligence on cards in circulation, key issuers' market share, transaction numbers and billed volumes.
Our experts cover the contemporary financial and regulatory landscape for the banking, acquiring and processing operations in Japan and deliver intelligent insights into the marketing strategies used for cards and payments. It includes coverage of the relevant regulations governing the country's financial and banking markets.
Japan Payments Research | Report Contents
TABLE OF CONTENTS
Demographics and the economy
Payments environment
Cards market
Mobile payments
Profit pool
The networks
Key retail banks and issuers
Acquiring and processing
Online acquiring
Regulatory and other cards market information
Japan Country Report Data Tables
(All 2016-25F unless otherwise stated)
1: Demographic and economic indicators
2: Ownership of key consumer devices
3: Internet usage by population
4: Access points 2016-23E
5: Account penetration
6: Consumer payment 2016-23E
7: B2C e-commerce payment methods 2016-23E
8: Total cards payment metrics
9: Contactless cards metrics 2018-25F
10: Credit card numbers
11: Total credit cards metrics
12: Credit cards profitability indicators
13: Debit cards numbers
14: Debit cards metrics
15: Prepaid/e-money cards metrics
16: Mobile proximity payment metrics: 2017-25F
17: Japan market profit pool including credit card numbers, billed volumes, outstandings, interest incomes, net interest revenues, merchant revenues, card fee revenues, other non-interest incomes, total revenues, net credit losses, operating expenses, total expenses, pre-tax profits, merchant service charges, rollover rates, APR, net credit losses to outstandings, operating costs to revenues, ROA (pre-tax profits to outstandings).
(All 2016-23F below unless otherwise stated)
18: Networks' credit card market shares
19: Networks' credit card numbers
20: Networks' credit card billed volume
21: Networks' number of credit card transactions
22: Networks' average credit card transaction value
23: Credit card interchange fees by network
24: Networks' debit card market shares
25: Networks' debit card numbers
26: Networks' debit card billed volume
27: Networks' number of debit card transactions
28: Networks' average debit card transaction value
29: Key credit card issuers market shares by credit card numbers 2018-23F
30: Key issuers market shares in credit card outstandings 2018-23F
31: Key debit card issuers market shares by debit card numbers 2018-23F
32: Merchant acquirer credit card market share 2022E
33: Credit card merchant service charges
34: Merchant acquirer debit card market share: 2022E
35: Debit card merchant service charges
36: Credit card issuer/issuing processor relationships
37: Credit card acquirer/acquiring processor relationships
38: Credit card issuing processor market shares by card numbers 2022E
39: Credit card acquiring processor market shares by the number of POS transactions 2022E
40: Online merchant acquirer market share 2022E
Japan Country Report | Selected Extracts
Payments Environment
Given that Japan is such a technologically advanced society, it is surprising that consumers have been slow to adopt card usage. However, older cohorts are attached to the ritualistic culture surrounding payments.
Cards Market
Whilst cash continues to be a preferred payment mode in Japan, in particular for lower-value purchases, its share is beginning to erode. Alternative cashless payment methods have begun to make more substantial inroads, propelled by hygiene concerns in particular.
Mobile Payments
Japan has been at the forefront of payment technologies, inventing QR codes in 1994 and also pioneering mobile wallets technology and integrated circuit (ie, chip) cards. That may come as a surprise as, when it comes to payments, Japan continues to be a cash-loving country despite its digital prowess.
Profit Pool
The Japanese payment card market is mature, with credit cards in use for approximately half a century. Around 301 million credit cards were in circulation as of the end of 2022, producing a credit card penetration rate of 272 credit cards per 100 adults.
Card Networks
The market for credit cards remains primarily split between Visa, Mastercard and JCB, which together had a combined market share of 98% in terms of card numbers in 2022. Total billed volume grew by 59% between 2016 and 2022.
Key Retail Banks and Issuers
Despite the weak yen, operating costs in Japan are among the highest in the world, and it is difficult to compete against the country's traditional domestic banks, which have deeper roots and higher capital bases.
Acquiring and Processing
The merchant-acquiring market in Japan is highly competitive, with all the major issuers involved ... Japan, primarily an in-house card processing market, is tough to penetrate for third-party processors.
Online Acquiring
The size of the B2C e-commerce market has been expanding steadily, growing from $115 billion in 2016 to $172 billion in 2022, the majority of which is retail based, followed by services and then digital content.
Regulatory and Markets Information
The country's Banking Act regulates the banking business, covering acceptance of deposits, lending of funds and processing of exchange transactions. As well as the Banking Act, the Payment Services Act is enforced by the FSA.
Japan Payments Report | Entities Referenced
More than 160 entities are referenced in this market report for Japan
2020 Tokyo Olympics
2025 World Exposition
2Checkout
7-Eleven
Adyen
Aeon
AEON Pay
AIFUL
Akamai Technologies
Alipay
All Nippon Airways
AlliedWallet
Amazon
American Express
ANA
Android Pay
Aozora
Aplus
Apple
au Pay
Bank of America Merrill Lynch
Bank of Nova Scotia
Bank Pay
BCCS
Bitcoin
bitFlyer
Bitpay
BMW
BOJ-NET Funds Transfer System
Branché
Bundle
CAFIS
CARDNET
Cardstream
Cash Passport
Casio
Cathay Pacific
Cedyna
Central Finance Company
Checkout.com
Citibank Japan
Coincheck
Coiney
Contour
Costco
Council of Anti-Phishing Japan
Credit and Finance Information System
Credit Saison
CyberSource
d Card
Dai Nippon Printing
Daiwa Securities
Daon
dBarai
DBS Bank
Delta Airlines
Denso Wave
Diners Club
Discover
DNP
DOCOMO
East Japan Railway Company
eBank Corporation
E-Saifu
Family Mart
FeliCa
Financial Services Agency
Fingerprint Cards
FIS
Foreign Exchange Yen Clearing System
FSA
Fujitsu
Fukuoka SoftBank Hawks
Fullerton India
FXYCS
Garmin Pay
General Electric
Ginko Pay
Ginza Lounge
Glassdoor
Global Payments
GMO Epsilon
GMO Payment Gateway
GoCoin
Golf Digest
GONET Japan
Google
GP Net
GP Network
Grab
Hayakak
Hilton
Honda Motors
HSBC
Icoca
IDEMIA
Indeed.com
Ingenico ePayments
Ito Yokado
Iyo Bank
J/Secure 2.0
JACCS
JAL
Japan Airlines
Japan Card Network
Japan Consumer Credit Association
Japan Credit Bureau
Japan Debit Card Promotion Association
Japan Electronic Payment Promotion Organisation
Japan Net Bank
Japan Post Bank
Japan STO Association
Japanese Bankers Association
Japanese Credit Bureau
Japanese Fair Trade Commission
Japanese Virtual Currency Exchange Association
JCB
JCBDC
J-Coin Pay
J-debit
JEPPO
JNB
JR East
JULO
JVCEA
KDDI
Keychain GK
Kidzania Koshien
KidZania Tokyo
Kisetsu Saison Finance India
Kitaca
Komgo
Korean Air
Kotora
Kyash
Lawson
LINE
Liquid
Lloyds TSB
Manaca
Strategic Development and Management Bureau
Manepa
Marriott
Mastercard
McDonald's
Mercari
Merpay
Mitsubishi UFJ Financial Group
Mitsubishi UFJ NICOS
Mizuho Bank
Mobile Suica
MoriX
MUFG
Nanaco
Naver Corp
NeoMobile Securities
Net Protections
New Otani
Nimoca
Nippon Pay
NTT Data
NTT DoCoMo
Olympic Games
OMC Card
Orico
Orient Corporation
Origami Pay
Osaka Credit Bureau
Paidy
Paidy Link
Panasonic
Pasmo
PayGent
Payments Japan Association
PayPal
PayPay Bank
Paytm
Persona STACIA
Pitapa
Prestia
Progmat
QUICPay
QUOQ
Rakuten
Rakuten Bank
Rakuten Edy
Rakuten Fintech Vietnam
Rakuten Seiyu
Recruit
Resona
Ripple
Rizal Commercial Banking Corporation
Rugby World Cup
SBI Holdings
SBI Motor Japan
SBJ Bank
Seven Bank
Seven Card Service
Shinsei
Sky Traveler
Smartpay
SMBC
SMBC Finance Service
SMBC Trust Bank
SMFG
Société Générale
Soft Space
Softbank
Sony
Sony Bank
Sony Payment Services
Splitit
Square
Starbucks
Starwood
Stripe
Sugoca
Suica
Sumishin SBI Net Bank
Sumitomo Mitsui
Sumitomo Mitsui Card Company
Sumitomo Mitsui Financial Group
Sumitomo Mitsui Trust Bank
Suruga Bank
Tama Shinkin Bank
Toica
Tokyo Star Bank
Toppan Printing
Toyota
Toyota Finance
TS CUBIC Pay
Tsuke-Pay
TSYS
Uber Eats
UBS Securities
UC Card
UnionPay
United Airlines
Universal Studios Japan
Vanilla Visa
Verifone
VeriTrans
Vesca
Visa
Visa Japan Association
VisaNet
VPBank Finance
V-Preca
Wako Tea Salon
WAON
WeChat Pay
Western Union
Wise
Worldline
XRP
Yahoo Japan
Yosakoi Soran Festival
Zengin System
Zozotown
MORE ASIA-PACIFIC PAYMENTS REPORTS
Argus Advisory Research reports delivering invaluable market and competitor intelligence on payments cards, e-money, acquiring/processing, retail banking, and consumer credit. Analysts and researchers use both primary and secondary source data and conduct in-depth interviews with senior industry executives and local experts.
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