Sponsored by Mobal Communications, provider of communication & payment solutions to expats in Japan
Visitors to Japan are often confounded by the variety of cashless payment options at checkout. Depending on the store or vending machine you will find a chart of payment acceptance marks that look something like this:
A full list of options at any convenience store includes chip and contactless card brands (VISA, Mastercard, AMEX, JCB, UnionPay) mobile QR payment apps (PayPay, Rakuten Pay, dPay, AliPay, etc.), big name point cards (dPoint, PONTA, T-Point) and eMoney (Suica, iD, QUICPay, WAON, nanaco, Edy).
The array of choices is tantalizing but visitors quickly discover they are limited to their plastic payments cards that don’t travel everywhere, like the vending machine pictured above. Credit card acceptance has exploded since 2016, the year Apple Pay launched in Japan, there are still lots of smaller places that don’t take cards but accept mobile QR payments in addition to cash. Unfortunately the rise in inbound visitors also means more card fraud with credit card payment networks limiting foreign issue cards in ways that are not easy to understand or resolve. Visitors from America for example find their cards work at stores but not for booking tickets online because many American card issuers don’t support EMV 3-D Secure v2 (3DS2) yet.
While these are not big problems for short term visitors who can run to the ATM and use cash on the road until they get home, long term visitors (anyone staying past the 3 month mark) will certainly feel the drag of not being plugged into domestic Japanese payments universe. Is there an easy path to get connected? With a little preparation and an open mind, definitely yes. Don’t be overwhelmed by bewildering variety of mobile based payment services. Despite all the bells, whistles and barcodes they all run on cash or credit cards.
There are 4 basic hurdles long term visitors face when connecting to Japanese mobile payments:
- Mobile account verification and authorization: a Japanese mobile number with SMS support is required for verification when setting up a Japanese mobile payment app account, just like it is for Apple Pay.
- 3DS2 support: the updated card brand security protocol for online and in-app purchases that do not use Apple Pay, Google Pay, Samsung Pay or other brand digital wallet platforms. Japanese issuers have made a big push for 3DS2, as of October 2023 over 95% of Japanese issue cards support it and Japanese businesses require it for online and mobile transactions that don’t use digital wallet platforms. European issue cards support 3DS2 but at present most US issue cards do not.
- Global NFC support. All NFC smartphones are required to support the 3 basic NFC hardware protocols (A-B-F) for NFC certification, unfortunately NFC software is a different story. Apple installs all the software necessary to support all different kinds of cards all over the world (credit cards, transit cards, etc.). Android manufacturers do not. This means that visitors with non-JP iPhone models can plug into Japanese mobile based card services like Mobile Suica while non-JP Android models cannot.
- Japanese app store account. Both Apple and Google let users switch country settings but the process is not always smooth and you may be locked into a Japanese country setting for 90 days before you can change it again. It may be easier to create a new Apple or Google ID set to Japan just for app downloading.
Getting connected
The most important item you will need to play in the world of Japanese payments is a JP mobile phone number with SMS support. Recently I had the opportunity to test and review MobalPay, a Japanese payment service aimed at short term expats offered by Mobal Communications Inc. designed as an option with their Japanese SIM data/voice/SMS plans.
MobalPay was a surprisingly flexible prepaid Mastercard, as noted in their support site details though not exactly clear from their marketing. It’s not so much the Mastercard card itself but how you can link it with other payment services. An easy entry point into the world of Japanese mobile payments when used in together with the Mobal SIM plan that includes SMS texting with a Japanese mobile number, a basic requirement for Japanese mobile payment account creation and verification.
Where exactly does the Mobal SIM and MobalPay take you in the Japanese payments jungle? A quick look by smartphone platform:
iPhone users can use: PayPay, Rakuten Pay, Mobile Suica, Mobile PASMO
Android users with a device bought outside of Japan are limited to PayPay and Rakuten Pay. As I could only test MobalPay with iPhone the strategy simulation outlined below only applies to the Apple platform.
A simple startup example
Let’s say you are staying for a year in the Tokyo area and plan to use both JR East and Metro lines regularly work commuting. The first order of business is the easiest: setting up Apple Pay Suica. You can do this all in Wallet without downloading anything from the App Store. In the event that you don’t have a payment card in Wallet for adding money to Suica, you can easily work around it by downloading Suica App which is widely available in App Stores across the world. Create a Mobile Suica account, add Suica to Wallet from Suica App and add money with MobalPay card in Suica App.
Adding mobile QR payments
PayPay and Rakuten Pay are where MobalPay shines as you can register MobalPay as the app payment card that bypasses the default prepaid account payment method, and the hassle of adding cash to it. All purchases are charged directly to MobalPay. Account creation is easy to do and once SMS verification is done, you are ready to use PayPay or Rakuten Pay. You will be limited to ¥5000 per month with PayPay + MobalPay as it does not support verification for raising the limits.
Adding Japanese iD payments to Apple Pay Wallet
Another interesting option is using the ANA Milage Club app to add an ANA Pay card to Apple Wallet. You can easily create an online ANA Milage account in English, download the app, sign-in and create an ANA Pay Wallet card using SNS verification. The ANA Pay is dual-mode and works on both iD (say iD) and VISA (say VISA Touch) payment networks further extending your cashless payment options. Mixi M is another popular option
Adding mobile ticketing and transit options
If you do not have a card that works for registering in Suica App or PASMO App (commuter passes and other regular transit options), smartEX and Eki-Net (Shinkansen eTickets), MobalPay is an easy card to register when setting up service accounts.
Point options
Points are a sore point (pun intended), MobalPay does not give you points because they donate most of their profits to charity. Unfortunately the Japanese economic zone point system apps (dPoint, PayPay Point, Rakuten Point) have taken the well known path of only giving points when using their own credit cards. You can still earn points only if you add cash to the app prepaid account via a Japanese bank account or ATM.
JRE POINT is more open and flexible. With a JRE POINT account you can register multiple Suica cards for (for example an entire family), earn JRE POINT with transit and shopping then move JRE POINT around to any of the registered Suica for a point recharge (1 point = 1 JPY) or use them for Express train and Shinkansen eTickets on JR East lines. You can also use JRE POINT for shopping at JR East station shopping malls. For example I buy clothes from my local Uniqlo exclusively with JRE POINT.
Further exploration
MobalPay 3DS2 support combined with Mobal SIM and SMS gives long stay users options to explore Japanese payment apps, mobile services, point options, even plug credit cards from home into the Apple Pay iD Japanese payment network. Think of it as easy on ramp to Japanese mobile payments, giving flexible payment alternatives when regular cards can’t be used and you don’t want to use cash. You could even become a ‘Wallet Jockey’ like some Japanese who work their money through different payment services to earn the most points and gift card discounts they want. Even if you are not the adventuresome type, you owe it to yourself to explore the Japanese payments jungle. There is something out there just for you.
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