Cashless Payments Using Mobile Phones

Dennis Faas's picture

Japanese mobile phones consistently deliver high-speed connections, digital television broadcasts and super-fast video downloads. It's not that Japan is hoarding the technology; the country is very willing to share their innovations with the global market. Still, some Japanese products (despite their efficiency) continue to fair poorly in North America.

A number of Japanese manufacturers are once again venturing westward in the hopes of financial success. Their North American promotional tour will be headlined by the "wallet phone".

Don't let the name fool you.

The "wallet" tagline does not refer to the actual size of the phone. It refers to the new technology powering them that allows for cashless payments using a phone in place of a debit or credit card.

The technology relies on a small chip inside the phone called FeliCa, which communicates with reader-devices located in retail stores, train stations, and vending machines all across Japan. (Source:

While there has been a significant amount of attention dedicated to cashless payments using mobile phones, these kinds of systems have been in existence since 2004. Ironically, many Japanese people who regularly pay for items using their mobile phones actually consider the technology to be a bit outdated.

Why is this service so popular in Japan compared to the rest of the world?

The popularity of the service can be attested to the overall mobile phone usage in Japan. Roughly 90% of the population use mobile phones on a regular basis. Many Americans would be shocked to learn that credit card usage is not very popular in Japan, which may also account for the high volume of cashless payments using mobile phones. (Source:

While the North American promotional tour is scheduled to launch in the next few weeks, no official start date has been announced.

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