Wednesday, April 27, 2005

Japanese banks seek to cash in on growth of e-money

The Daily Yomiuri On-Line reports that Japanse banks seek to introduce multifunctional cards that also work as electronic money.

Before throwing the idea away from the US or European perspective we should recognize that the Japanese society is very cash oriented. Thus, e-money might very well work in Japan as a replacement of cash.

After Sony Corp. and its partners launched Edy e-money in November 2001, the number of such cards had reached 9.2 million as of March, double the figure a year earlier. The number of stores where Edy e-money can be used increased fivefold in the same 12 months.

Of the 11 million Suica cards issued by East Japan Railway Co. as of the end of February, about 5.7 million have the e-money function.

Using special machines or the Internet, users can deposit money on cards with integrated circuit chips and cell phones that have an e-money function. They can then pay for purchases simply by having the cards or cell phones scanned by reading devices in stores.