Cashless Payment

Cashless payment encompasses all payment methods that do not use physical cash: credit cards, debit cards, electronic money (Suica, Oyster), and QR code payments (PayPay, Alipay, Google Pay). Japan's cashless ratio reached 42.8% in 2024, hitting the government's 40% target ahead of schedule, and METI's latest calculation, based on its revised domestic indicator, puts the 2025 ratio at 58.0%. Internationally, countries such as South Korea and China report higher cashless ratios than Japan. National figures are not directly comparable, however, because each indicator counts a different set of payment methods and uses a different denominator, so the mix of methods people actually use for daily shopping is as telling as the headline percentage.

QR code payments spread rapidly from the late 2010s because setup costs are minimal. Accepting cards or electronic money requires a dedicated terminal, whose purchase and installation are the first hurdle, but QR code payment can start with just a printed QR code on the counter (user-scan method). This brought cashless capability to small shops, food stalls, and flea markets that previously could not afford terminals. Whichever pattern is used, a fee is deducted from each transaction, and the payout cycle to the merchant bank account is set by the contract with the payment provider. Cash stays in hand immediately, whereas cashless sales arrive together on a later date, so fee rates and payout timing are worth checking before signing up.

Two scanning patterns exist. In user-scan (MPM: Merchant Presented Mode), the customer scans the store's QR code and enters the amount. In store-scan (CPM: Consumer Presented Mode), the store scans the customer's phone-displayed QR code. User-scan requires virtually zero store investment but risks manual amount entry errors. Store-scan enables accurate POS-integrated processing but requires a scanning terminal. Convenience stores and supermarkets, which already have terminals at the register, therefore tend to choose store-scan, while independent shops and stalls without register equipment favor user-scan; one store may offer both depending on its floor layout and customer volume.