A Japanese financial services group is drawing up plans to issue its own negotiable digital currency to be used for instant P2P payments and transfers.
SBI Holdings of Japan, one of the leading financial services groups already invested in digital currencies and block-string technology (via Ripple), is expected to launch its own digital currency for payments. According to the major Nikkei regional publication, the financial group's digital token will also be tradable for the Japanese yen and will be based on blockchain technology.
The digital currency will allow consumers to make payments in stores instantly and can also be used to make point-to-point transactions with significantly low costs compared to existing methods, including credit cards and "digital money" portfolio that assumes the value of fiduciary money).
SBI's digital currency will maintain a stable exchange rate for the Japanese yen. SBI officials will begin testing the digital currency at stores near the company's Tokyo headquarters next year.
Credit cards are expensive
Less than 70% of Japanese supermarkets accept cards due to an expensive onboarding process where credit card payment terminals cost ¥ 100,000 (about $ 900) to install beyond monthly rental fees. For all the notions of being an advanced technology society, Japan lags behind its Asian counterparts - particularly China and Korea - in cashless payments. Such is the disparity that the Japanese authorities have established a FinTech growth strategy with the ultimate goal of doubling the rate of adoption of digital payments (currently 19% miserable) over the next decade.
The broader retail economy in Japan is apt for the disruption of new financial technologies, including bitcoin. Following this year's recognition as a legal payment method, an awareness and adoption boom of cryptocurrency can see up to 300,000 Japanese stores accepting bitcoin by the end of the year.
SBI - great in Bitcoin
Notably, SBI has already launched its own digital currency trading and trading platform in 2016, making it the first digital currency exchange with bank support. Launched in November 2016, SBI Virtual Currencies Co., Ltd. increased approximately. 300 million yen in capital in the days prior to its establishment.
SBI's investment arm also led a $ 3 billion ($ 27 million) funding round on investment in bitFlyer, Japan's largest bitcoin exchange for turnover in April 2016.