East Japan Railway Company in collaboration with cloud and internet service provider IIJ may allow millions of Japanese subway riders to use cryptocurrencies as a payment option. The companies are reportedly in talks to see how they can integrate Bitcoin and several other cryptocurrencies into the national public transport card known as the Suica, a rechargeable contactless smart card.
JR East is the largest company of the country’s main railway operator, Japan Railways Group (JRG). According to local news outlet ANN News, JRG is exploring its own crypto exchange or crypto-related business that would allow the company to interface with a major bank to facilitate the transactions.
Subway riders would also be able to use the Suica to top up crypto that they could spend at shops located in the subway stations.
The government plans to double digital payments to 40% of all transactions by 2027.
Reports the Japan Times,
“According to the report ‘Cashless Vision,’ compiled by a panel of experts under the Ministry of Economy, Trade and Industry, cashless systems at retail stores will save manpower at a time when Japan desperately needs to improve productivity amid a labor shortage and declining population.
Also, shifting from cash to digital money will improve the transparency of money flows that will enable the government to collect taxes more accurately and efficiently.
The cost of handling cash is increasingly worrying businesses. Nomura Research Institute estimates such costs exceed ¥1 trillion annually.”
The initiative marks one of the largest cryptocurrency adoption plans to date, and demonstrates a real-world use case that would impact millions of subway riders in the greater Tokyo area, among other regions in Japan.