Good news: Japanese consumers are using less cash and more cashless payments. The winners are smartphone contactless apps like Mobile Suica (NFC) and PayPay (QR) which saw use rates grow from 16.4％ to 28.6％ in the August 2019 to January 2020 period. The CASHLESS Rebate program has clearly lifted all cashless methods which it was designed to do. The bad news? We have no idea where the economy is going in the coronavirus crisis with the Tokyo Olympics in the balance.
The new cashless payments market report from Mobile Marketing Data Labo (MMD) has a few other interesting tidbits. Apple Pay Suica is the most used payment method on iPhone followed closely by PayPay, convenience store purchases are nearly 80%.
The growth of smartphone payments makes sense because it’s one the easiest ways for users to enjoy the benefits of the CASHLESS Rebate program with multiple payment choices, and most convenience stores offer an instant 2% rebate for cashless purchases. The next challenge is how cashless payment trends play out after the rebate program ends June 30.
UPDATE: The Covid crisis will drive cashless payment growth in Japan more than the rebate program and the Tokyo Olympics could ever hope to achieve.