What e-Commerce payment methods are used by Japanese consumers?
Despite Japan historically being a cash-oriented society, bank cards are becoming increasingly popular in this location – both online and off. Spending using plastic in 2014 grew 10% on the previous year to an all-time high of $352 billion.
In Japan, consumers generally use credit cards for larger payments and pre-paid cards for smaller transactions.
Debit cards issued: 419.7 million.
Credit cards issued: 312.2 million.
Pre-paid cards in circulation: 224.5 million
A considerable number of online purchases in Japan are paid for using methods which are unpopular or even unheard of in major Western markets, such as the convenience store payment. This method of payment is offered by many e-retailers in Japan, and involves consumers ordering goods online, receiving a reference number following confirmation, and then paying for the item at a kiosk or cash register at a convenience store near them, known locally as a Konbini. Konbinis also offer a range of other payment methods for shoppers in Japan, such as bank transfers and ATM payments. Konbini payments do, of course, come with some risk to the e-trader. About 15% of items purchased with the assurance of a konbini payment are not paid for. As a result of this, sellers should wait for payment to clear before shipping an order.
Examples of popular Konbinis in Japan include:
In contrast to neighbouring Asian markets such as China, e-money technology has yet to really take off in Japan, despite being over 10 years old. Indeed, eWallets make up only 6.6% of all online transactions in this location.
The main third-party payment providers in Japan include:
The ever-popular PayPal only recently set up in Japan and is still attempting to establish a foothold in the country. It currently boasts only about 1 million local users.
Japan, alongside South Korea and the UK, is the most advanced market for mobile shopping in the world. Mobile’s share of e-commerce is now over 50% in Japan, and this is expected to rise to 61% by the end of 2015. Facilitating m-commerce payments in Japan, then, is of the upmost importance, with some 89% of all online shoppers having engaged in the practice in this country.
Key points to note include that:
Some routes to the Japanese e-commerce market will oblige you to set up a distinct legal entity.
It is important for your website to capture the right look and feel to attract Japanese consumers as they attribute great importance to the aesthetics of online shops.
The UK's logistics infrastructure is well developed and relatively straight-forward to negotiate.