S’pore visitors to Japan could use QR payment such as GrabPay or PayNow by 2025

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S'pore visitors to Japan could use QR payment such as GrabPay or PayNow by 2025
Walter Sim

The JPQR payment system will be compatible with an array of Japanese as well as foreign payment wallets. PHOTO: PAYMENTS JAPAN ASSOCIATION
TOKYO – Tourists to Japan from Singapore and seven other Asian countries will soon find it easier to pay for their purchases using their local QR code wallets under a new joint payment scheme.

Conversely, Japanese travellers will likewise be able to – for example – scan and pay for their chicken rice meal at a Singapore hawker stall that accepts QR code payments.

Japan aims to begin the scheme in time for the Osaka World Expo, which begins on April 13, 2025, and is working to ensure that Japan's JPQR payment system is compatible with the unified standards of eight other countries.

The countries are Singapore (SGQR), Malaysia (DuitNow QR), Indonesia (QRIS), the Philippines (QRPh), Thailand (Thai QR Payment), Cambodia (KHQR), Vietnam (VietQR) and India (BharatQR).

But Japan faces the urgent challenge of increasing the usage of its JPQR system, which is now available in just 15,000 businesses across the country, mostly small ones. Few of these are frequented by foreign tourists.

"One single QR code in a store can process payments from multiple payment operators across Asia," Mr Kenichi Matsuguma, director of the cashless payment promotion office at Japan's Ministry of Economy, Trade and Industry, told The Straits Times.

The JPQR will be compatible with an array of Japanese as well as foreign payment wallets. So Singapore visitors to Japan can use, say GrabPay or PayNow, to make a JPQR payment.



But he added: "The challenge is that not many Japanese businesses are on board, though we hope the potential use by foreign visitors will be a catalyst to convince them to adopt JPQR."

Mr Matsuguma admitted that Japan has been a laggard in going cashless compared with Asean. In 2022, Singapore, Indonesia, Thailand, Malaysia and the Philippines had signed a pact to unify their QR code payment systems.

In 2023, 39.3 per cent of all transactions in Japan were cashless ones, nearly triple the 13.2 per cent in 2010, according to Economy Ministry data. But the figure is much lower than that in neighbouring China and South Korea: In 2020, cashless payments made up 83 per cent of all transactions in China and 93.6 per cent in South Korea, according to a March 2023 report by a Japanese government study group on cashless payments.

Mr Matsuguma said the aim is for Japan to achieve 40 per cent cashless transactions by 2025, and eventually, 80 per cent, though no target year has been set for the latter goal.

Credit card payments formed the bulk of cashless transactions in Japan in 2023, at 83.5 per cent, while QR code payments across the country's array of QR payment wallets accounted for 8.6 per cent.

Most of these QR code transactions are made through what is known in the industry as "consumer-presented mode" (CPM), which is by far the prevailing method in Japan and used at millions of stores including convenience stores, drug stores and restaurants.

However, the JPQR-unified QR code, which visitors from eight Asian countries including Singapore will be able to use, is known as "merchant-presented mode" (MPM), which is similar to Singapore's SGQR.

Under the CPM model, the retailer scans a QR code generated by the shopper's mobile device. With the MPM, the consumer scans a retailer's QR code and, in most instances, has to manually key in the purchase amount.

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