As payments in the Asia-Pacific (APAC) region continue to evolve, payment software company ACI in the world announced its collaboration with CARDNETthe Japanese domestic payment network, to modernize its digital payment infrastructure.
The agreement will see ACI work with CARDNET to provide the latest digital payment technology and next-generation solutions to CARDNET customers.
While it currently processes around 30 billion domestic payment transactions per year, while providing card payment switching services and 889,000 point-of-sale terminals to Japanese merchants, the introduction of CARDNET in a new infrastructure will will meet the country’s growing demand for digital payments.
While APAC has long been associated with the rise of digital payments, somewhat surprisingly, Japan’s adoption of the technology still lags significantly behind that of its neighbours.
According Statisticalthe total transaction value of the digital payments segment in Japan is expected to reach $325.10 billion in 2022. In comparison, the same data suggests that the total transaction value of the digital payments segment in China is expected to reach $3,497.00 billion dollars during the same period.
As disclosed by JP Morganit is reportJapan’s lack of adoption of digital payments has little to do with access to financial services, as its own data indicates that 98.2% of its citizens have a bank account.
Digging deeper into this figure, JP Morgan explains how the use of cash in Japan remains significant, accounting for 13% of all online transactions in 2021.
Paying hard cash for online services – impossible, right? Not in Japan.
The country has about 55,000 konbini, which are convenience stores that accept and process cash payments for online transactions. However, consumers must make payment within six days of receiving their goods and identification must be presented to make payment.
Reuters even described Japan as “the most dedicated hoarders‘.
While ACI Worldwide and CARDNET no doubt have big plans for Japan’s digital payments ecosystem, the collaboration will have to compete with a fierce attitude towards cash unlike anywhere else in the world.
Japan has a strong cultural perception of the use of cash, believing that it offers a superior and unparalleled level of security and anonymity when making payments; a preference that, as demonstrated by the konbini, is seamlessly facilitated in the country’s economy with many cash on delivery options available.
However, Japanese merchants can rest assured that their digital payment services are in good hands. ACI’s agreement with CARDNET is the latest in a series of APAC-wide successes for ACI as the company continues to grow in the region.
Last month, Worldline announced that it had have joined forces with Casio computer to disrupt Japan’s “bulky payment acceptance ecosystem” by facilitating card payments and cashless purchases in the country.
It follows a similar announced earlier this year that Worldline had entered into a partnership with Vesca enter the Japanese merchant services market.
“CARDNET has taken a big step forward in its digital payment journey and we are excited to be part of the modernization of its payment architecture and the Japanese payment ecosystem,” explains Leslie ChooManaging Director, APAC, ACI Worldwide.
“As digital payments networks in Asia become increasingly interconnected, having the right technology, collaboration and a shared vision will be essential to staying ahead and delivering unparalleled convenience to customers.”