Electronic Cash – Coming to a Store Near You

August 21, 2007 at 6:01 pm 2 comments

Many Japanese carry large amounts of cash in their bags or wallets, and it surprises foreign visitors to discover that stores and restaurants in Japan don’t take plastic. Traditionally a cash-based society, Japan has not been quick to embrace credit cards and ATM cards. They don’t need to; in Japan, street crime is quite low, and there is almost no fear of being robbed.

But since 2001, the Tokyo subway system and East Japan Railway Company have slowly been paving the way for higher acceptance of electronic-cash cards. E-cash cards are similar to what Americans think of as gift cards (like for Starbucks or Barnes & Noble), where you put a finite amount of money on the card and then use it for a specific product or on a specific brand. Once you’ve spent the balance, you either throw out the card or add more money; but you don’t receive a bill in the mail and you don’t pay minimums or carry over payments from month to month.


Pasmo e-cash cards, which work for 23 railways and 32 bus operations in Japan, use integrated circuit chips embedded in cell phones and smart cards. Running late for your train? You barely have to stop when you pay for your tickets – just hold your cell phone next to the electronic reader as you race by!


According to The Japan Times, the Pasmo cards sold out very quickly this spring, though more will become available this month. The newest, and most popular card right now is Seven & I Holdings Co.‘s “nanaco,” which was first issued in late April and can be used at thousands of 7-Eleven convenience stores. (“Nana” means “seven” in Japanese.)

7-Eleven was the first retailer to jump on the e-cash bandwagon, but Ito-Yokado grocery store will present their own e-card this fall, and restaurants like McDonalds are eager to join in, too.

The psychology involved in using E-cash cards is a bit different than using a credit card, however. Japan Times reports, “Experts say e-money will encourage consumers to increase shopping as consumers take e-money as money already spent, which makes it psychologically easier to purchase extra items.”

Shopaholics, beware!

Sarah S.

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Entry filed under: Japanese Business, Japanese Entertainment.

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  • 1. PC Use Among Japanese Plummets « JPBizDirect’s Blog  |  December 5, 2007 at 4:36 pm

    […] their phones like cash cards at the subway station or grocery store. (For more on that, see our E-Cash post from […]

  • 2. 100 Cards in 1 « JPBizDirect’s Blog  |  July 3, 2008 at 10:16 am

    […] 3, 2008 Back in August 2007, I wrote about Japan’s increasingly impressive electronic-cash cards. In Japan, with a quick swipe of a Pasmo or nanaco card, you can pay for public transportation on […]

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