A general term for payment methods that use electronic means to settle transactions without cash. It is a broad concept encompassing credit cards, e-money, QR code payments, online bank transfers, and more.
Overview and Classification of Digital Payments
Digital payment is a comprehensive term referring to all electronic payment methods other than cash. Broadly classified, they fall into five categories: card payments (credit cards, debit cards), e-money (Suica, Rakuten Edy), QR code payments (PayPay, Rakuten Pay), online banking (digitized bank transfers), and cryptocurrency payments.
Japan's cashless payment ratio reached approximately 39% as of 2023 and continues to trend upward year over year. The government set a target of 40% by 2025 and has promoted cashless adoption through point cashback programs and the My Number Points initiative. On the merchant side, declining costs for payment terminals have accelerated adoption among small and medium-sized businesses.
Practical Comparison Points for Choosing a Digital Payment Method
When selecting a digital payment method, comparing across four axes - cashback rate, number of supported stores, transaction speed, and security - is effective. Since cashback rates fluctuate significantly during campaigns, you should compare based on the standard base rate. For supported stores, prioritize checking availability at the shops you use daily (supermarkets, convenience stores, drugstores).
In terms of transaction speed, contactless payments are the fastest, while QR code payments are slightly slower due to the need to launch an app. From a security standpoint, contactless payments with tokenization support offer the highest level of safety. That said, all payment methods have fraud compensation systems in place, so there is no need for excessive worry. The smart approach is to designate the method that best fits your usage pattern as your primary option and supplement it with one or two alternatives.
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