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Japan has made speedy progress towards a cashless society in the last five years. Despite a strong cultural preference for cash — especially among older people and rural residents — many Japanese are now embracing digital payments. In 2023, non-cash payments made up 39.3% of transactions in the country.
This shift has been fuelled by the government's "Cashless Vision", along with innovations in digital wallets. E-wallets like PayPay offer a winning mix of speed and convenience, enabling both consumers and businesses to keep up in a fast-moving society.
Launched in 2018 by the SoftBank Group and Yahoo Japan, PayPay has fast become a household name for digital payments. 72% of consumers are familiar with PayPay, and another 67% use it regularly — making it an essential payment choice for anyone doing business in Japan.
By tapping into this e-wallet, your business can unlock access to its 67 million registered users — giving you a major edge over your competition. If you're expanding into Japan, here's what you need to know about PayPay.
Why e-wallets like PayPay are thriving in Japan
Although cash has long been king in Japan, e-wallets and other cashless options are becoming widely popular. There are a few forces driving their rise:
l Strong government support: The Japanese government has rolled out various subsidies to encourage businesses and consumers to adopt cashless payments. Japan has also recently begun allowing companies to pay wages through digital payment apps, with PayPay being the first to win government approval for this service.
l Tech-savvy consumers: Japan's e-commerce sales shot up by 43.5% between 2017 and 2022, reflecting how people are increasingly going online for most shopping needs. This shift towards e-commerce has made digital payment a habit for consumers.
l App-based ecosystems: Superapps are gathering momentum in Asia, and PayPay is one of them. The e-wallet has already expanded beyond payment services to food delivery and online shopping, creating an ecosystem that serves many aspects of users' lifestyles.
Key features of PayPay
Used by nearly 70% of consumers from ages 16 to 60, PayPay is a leader in Japan's e-wallet landscape. But what makes this e-wallet so popular?
A user-friendly interface
PayPay is designed to be user-friendly for both Japanese-speaking and English-speaking consumers. The UX team performs research to localise the app's wording and tone in both English and Japanese, in order to create a friendly and comfortable experience for users.
To keep the user experience running smoothly, PayPay also updates the app at least once a week — adding up to over 50 updates a year.
Pay instantly, anywhere
PayPay is accepted by over 4 million merchants across Japan, from konbini (convenience stores) to restaurants to e-commerce platforms. Users can also count on PayPay for all kinds of online transactions, such as paying their utility bills and investing. Using PayPay – which also part of the Alipay+ ecosystem, accepted by 90 million merchants in 66 countries – means they can complete transactions in seconds and simplify many payment needs in their daily lives.
Beyond convenience, PayPay keeps users coming back for its attractive cashback and coupons. If your business accepts PayPay, this loyalty makes it easier to encourage customers to shop with you.
When customers use PayPay, they earn PayPay points based on the transaction amount. Each PayPay point equals 1 yen, which they can spend at any store that accepts PayPay. The more they use PayPay, the more cashback they can win — up to 2%.
In addition, users can get monthly and weekly coupons with discount offers on PayPay. These cost savings attract customers to spend, driving sales for merchants.
Strong security measures
A range of robust security features keep transactions safe for both consumers and merchants on PayPay. These include:
l 24/7 fraud detection: PayPay's dedicated security team monitors the system round the clock to check for fraud and prevent unauthorised use.
l Two-factor authentication: SMS authentication adds an extra layer of security, using your mobile number to verify your identity.
l Data encryption: Your personal info, such as credit card number and account details, is encrypted and stored. This protects your data from being stolen.
l Biometric authentication: To combat fraud, you can set up fingerprint recognition or facial ID to verify transactions.
l 24/7/365 phone support: If issues crop up, you can call PayPay's customer support desk for 24/7 assistance.
Versatile top-up options
Users have flexibility and convenience when topping up their e-wallet. They can link their bank account or credit card to PayPay, or charge their e-wallet with cash at various ATMs.
Easy account set-up
Whether you want to accept PayPay as an online payment method or set up a payment terminal in your physical store, getting started is straightforward. All you need to do is download the PayPay app on iOS or Android, fill in your business details and identification, and submit the required documents for review.
Even if your company requires multiple accounts for different locations, you can consolidate all your accounts by signing up with a merchant payment services provider like Antom. The platform offers access to over 40 payment options, bank transfers, online banking, and digital wallets like PayPay and more. This makes it simple to streamline your operations and boost efficiency.
Seamless integrations
A seamless payment experience can reduce cart abandonment and drive sales growth for your business. PayPay for Developers is designed to help you achieve this, offering a suite of tools to integrate PayPay into your website or app.
Depending on your business needs, you can choose between four ways to implement PayPay:
l App Invoke: This API calls the PayPay app on a user's mobile device and displays payment details instantly. Users can then pay seamlessly in your website or app as they would in PayPay.
l Dynamic QR: Display a dynamic QR code in your website or app, which users can scan to confirm payment.
l Web Payment: This integration adds PayPay as a payment method in your online store. Users can log in with their PayPay credentials or invoke their PayPay app to transact securely.
l Native Payment: Enable your customers to link their PayPay account with their account on your platform. Once a user selects a purchase on your website or app, payment can be made automatically — taking the friction out of shopping in your store.
Expand your business to Japan with Antom
As Japan continues to embrace digital payments, businesses that tap into local payment methods will be in a better position to win over consumers and drive sales. A popular payment choice like PayPay can unlock access to a massive consumer pool and give you a leg up for success.
If you're looking to streamline Japan's preferred payment methods in your online store, Antom can help. With Antom, you can access an ecosystem covering hundreds of payment methods across more than 40 countries — including PayPay.
Contact us to learn more about PayPay and other payment methods around the world: https://www.antom.com/contact-us
