Japan’s Cards and Payments Industry: Emerging Opportunities, Trends, Size, Drivers, Strategies, Products and Competitive Landscape

During the review period, the number of cards in circulation in the channel increased at a compound annual growth rate (CAGR) of 2.94% to reach 980.9 million cards in 2013, while its value recorded a review-period CAGR of 3.45%, reaching JPY70.1 trillion (US$723.4 billion) in 2013.

The Japanese card payments channel was mainly driven by strong growth in the prepaid cards category, which registered the highest review-period CAGR of 12.68%. The share of prepaid cards category in overall card payments channel increased from 15.9% in 2009 to 22.9% in 2013. In terms of number of cards in circulation, prepaid cards increased from 139.3 million in 2009 to 224.5 million in 2013. The charge cards category recorded the second-highest review-period CAGR of 2.55%, increasing from 7.4 million cards in 2009 to 8.2 million in 2013. The debit cards category registered the slowest growth during the review period, at a CAGR of 0.46%, increasing from 412.0 million cards in 2009 to 419.7 million in 2013.

In 2009, non-cash payments in Japan were dominated by credit transfers with a total transaction value of JPY2,433.9 trillion (US$26.0 trillion), while card payments valued JPY61.2 trillion (US$654.1 billion). During the review period, card payments recorded a CAGR of 3.45%, to value JPY70.1 trillion (US$723.4 billion) in 2013, while credit transfers recorded a CAGR of 3.73%, to value JPY2,817.7 trillion (US$29.1 trillion) in 2013. Internet penetration growth and rising disposable incomes, supported by an increased consumer spending, resulted in increased online retail sales. The country’s domestic business-to-business (B2B) e commerce grew to JPY262.0 trillion (US$3.3 trillion) in 2012, an increase of 101.7% compared to the previous year. Similarly, business-to-consumer (B2C) e-commerce increased by 112.5%, to reach JPY9.5 trillion (US$119.1 billion) in 2012.

Scope

• This report provides a comprehensive analysis of Japan's cards and payments industry.

• It provides current values for Japan's cards and payments industry for 2013, and forecast figures for 2018.

• It details the different economic, infrastructural and business drivers affecting Japan's cards and payments industry.

• It outlines the current regulatory framework in the industry.

• It details the marketing strategies used by various banks and other institutions.

• It profiles the major banks in Japan's cards and payments industry.

Key Highlights

• During the review period, the number of cards in circulation in the channel increased at a compound annual growth rate (CAGR) of 2.94% to reach 980.9 million cards in 2013, while its value recorded a review-period CAGR of 3.45%, reaching JPY70.1 trillion (US$723.4 billion) in 2013.

• The Japanese card payments channel was mainly driven by strong growth in the prepaid cards category, which registered the highest review-period CAGR of 12.68%. The share of prepaid cards category in overall card payments channel increased from 15.9% in 2009 to 22.9% in 2013. In terms of number of cards in circulation, prepaid cards increased from 139.3 million in 2009 to 224.5 million in 2013. The charge cards category recorded the second-highest review-period CAGR of 2.55%, increasing from 7.4 million cards in 2009 to 8.2 million in 2013.

• Consumers are moving to prepaid and postpaid e-money purses incorporated into payment cards and mobile phones to make fast and secure contactless transactions, both at point-of-sale (POS) terminals and online. During the review period, the transaction value of prepaid cards increased at a CAGR of 21.76%, from JPY1.3 trillion (US$14.2 billion) in 2009 to JPY2.9 trillion (US$30.1 billion) in 2013. Sony developed the chip for Japan’s e-money platform which is now used in payment cards and mobile phones.

• Internet penetration growth and rising disposable incomes, supported by an increased consumer spending, resulted in increased online retail sales. The country’s domestic business-to-business (B2B) e commerce grew to JPY262.0 trillion (US$3.3 trillion) in 2012, an increase of 101.7% compared to the previous year. Similarly, business-to-consumer (B2C) e-commerce increased by 112.5%, to reach JPY9.5 trillion (US$119.1 billion) in 2012.

Reasons to buy

• Make strategic business decisions using top-level historic and forecast market data related to Japan's cards and payments industry and each market within it.

• Understand the key market trends and growth opportunities within Japan's cards and payments industry.

• Assess the competitive dynamics in Japan's cards and payments industry.

• Gain insights in to the marketing strategies used for selling various card types in Japan.

• Gain insights into key regulations governing Japan's cards and payments industry.

Companies mentioned

Shinsei Bank

Japan Post Bank

Citibank Japan

Credit Saison

JACCS

MasterCard

Visa

American Express

JCB

Table of Contents

1 Executive Summary

2 Analysis of Market Environment, Key Trends and Drivers

2.1 Payment Infrastructure and Emerging Technologies

2.1.1 Automatic Teller Machines (ATMs)

2.1.2 Point of sale (POS) terminals

2.1.3 Internet penetration

2.1.4 Contactless payments

2.1.5 Mobile payments

2.2 Business Drivers

2.2.1 Growth in retail industry

2.2.2 Rising online retailing

2.3 Economic Drivers

2.3.1 Stable GDP

2.3.2 Increasing GDP per capita income

2.3.3 Low unemployment rate

3 Cards and Payments Industry Share Analysis

3.1 Industry Overview

3.1.1 Cash

3.1.2 Checks

3.1.3 Card payments

3.1.4 Credit transfers

4 Regulatory Framework and Card Fraud Statistics

4.1 Regulatory Framework

4.1.1 Foreign direct investment (FDI) regulations

4.2 Card Fraud Statistics

4.2.1 Cards-not-present fraud

4.2.2 Counterfeit cards

4.2.3 Cards lost or stolen

4.2.4 Card ID theft

5 Emerging Consumer Attitudes and Trends

5.1 Industry Segmentation and Targeting

5.1.1 Retail segment

5.1.2 Corporate segment

5.2 Travel and Tourism Spending

5.2.1 Outbound tourist trips

5.2.2 Outbound tourist spending

5.3 Retail Card Spending

5.3.1 Analysis by product category

5.3.2 Analysis by retail channel share

6 Analysis of Card Payments and Growth Prospects

6.1 Channel Share Analysis by Card Category

6.2 Size and Forecast of the Card Payments Channel

6.2.1 Analysis by number of cards in circulation

6.2.2 Analysis by transaction value

7 Analysis of Credit Card Payments and Growth Prospects

7.1 Overall Category Size and Forecast

7.1.1 Analysis by number of cards in circulation

7.1.2 Analysis by transaction value

7.1.3 Analysis by transaction volume

7.2 Transaction Share Analysis by Channel

7.2.1 Analysis by transaction value

7.2.2 Analysis by transaction volume

7.3 Personal Credit Cards Segment Size and Forecast

7.3.1 Analysis by number of cards in circulation

7.3.2 Analysis by transaction value

7.3.3 Analysis by transaction volume

7.4 Commercial Credit Cards Segment Size and Forecast

7.4.1 Analysis by number of cards in circulation

7.4.2 Analysis by transaction value

7.4.3 Analysis by transaction volume

7.5 Competitive Landscape

7.5.1 Scheme share analysis

7.5.2 Issuer share analysis

8 Analysis of Debit Card Payments and Growth Prospects

8.1 Overall Category Size and Forecast

8.1.1 Analysis by number of cards in circulation

8.1.2 Analysis by transaction value

8.1.3 Analysis by transaction volume

8.2 Transaction Share Analysis by Channel

8.2.1 Analysis by transaction value

8.2.2 Analysis by transaction volume

8.3 Competitive Landscape

8.3.1 Scheme share analysis

8.3.2 Issuer share analysis

9 Analysis of Charge Card Payments and Growth Prospects

9.1 Overall Category Size and Forecast

9.1.1 Analysis by number of cards in circulation

9.1.2 Analysis by transaction value

9.1.3 Analysis by transaction volume

9.2 Transaction Share Analysis by Channel

9.2.1 Analysis by transaction value

9.2.2 Analysis by transaction volume

9.3 Personal Charge Cards Segment Size and Forecast

9.3.1 Analysis by number of cards in circulation

9.3.2 Analysis by transaction value

9.3.3 Analysis by transaction volume

9.4 Commercial Charge Cards Segment Size and Forecast

9.4.1 Analysis by number of cards in circulation

9.4.2 Analysis by transaction value

9.4.3 Analysis by transaction volume

9.5 Competitive Landscape

9.5.1 Scheme share analysis

10 Analysis of Prepaid Card Payments and Growth Prospects

10.1 Overall Category Size and Forecast

10.1.1 Analysis by number of cards in circulation

10.1.2 Analysis by transaction value

10.2 Open-Loop Prepaid Cards Segment Size and Forecast

10.2.1 Analysis by number of cards in circulation

10.2.2 Analysis by transaction value

10.3 Closed-Loop Prepaid Cards Segment Size and Forecast

10.3.1 Analysis by number of cards in circulation

10.3.2 Analysis by transaction value

11 Merchant Acquiring

11.1 Merchant Acquirers in Japan

11.2 Company Profile of JCB

12 Company Profiles of Card Issuers

12.1 Shinsei Bank

12.1.1 Key financials

12.1.2 Card portfolio

12.1.3 Strategies

12.2 Japan Post Bank

12.2.1 Key financials

12.2.2 Card portfolio

12.2.3 Strategies

12.3 Citibank Japan

12.3.1 Key financials

12.3.2 Card portfolio

12.3.3 Strategies

12.4 Credit Saison

12.4.1 Key financials

12.4.2 Card portfolio

12.4.3 Strategies

12.5 JACCS Co., Ltd.

12.5.1 Key financials

12.5.2 Card portfolio

12.5.3 Strategies

13 Appendix

13.1 Methodology

13.2 Contact GlobalData

13.3 About GlobalData

13.4 GlobalData’s Services

13.5 Definitions

13.6 Disclaimer

List of Tables

Table 1: Japanese Payment Channels (JPY Trillion), 2009–2013

Table 2: Market Entry Strategies of Foreign Banks in Japan

Table 3: Japanese Card Fraud (JPY Million), 2009–2013

Table 4: Cards Offered by Various Banks for Shoppers in Japan

Table 5: Cards Offered by Various Banks for HNWIs in Japan

Table 6: Cards Offered by Various Banks for Travelers in Japan

Table 7: Cards Offered by Various Banks for Young Population in Japan

Table 8: Japanese Card Spending by Retail Product Category (JPY Billion), 2008 and 2012

Table 9: Japanese Card Spending by Retail Channel (JPY Billion), 2008 and 2012

Table 10: Japanese Card Payments Channel by Card Category (Million), 2009–2018

Table 11: Japanese Card Payments Channel Size by Volume of Cards (Million), 2009–2018

Table 12: Japanese Card Payments Channel Size by Transaction Value (JPY Trillion), 2009–2018

Table 13: Japanese Card Payments Channel Size by Transaction Value (US$ Billion), 2009–2018

Table 14: Japanese Credit Cards Category Size by Volume of Cards (Million), 2009–2018

Table 15: Japanese Credit Cards Category Size by Transaction Value (JPY Trillion), 2009–2018

Table 16: Japanese Credit Cards Category Size by Transaction Value (US$ Billion), 2009–2018

Table 17: Japanese Credit Cards Category Size by Transaction Volume (Billion), 2009–2018

Table 18: Japanese Personal Credit Cards Segment Size by Volume of Cards (Million), 2009–2018

Table 19: Japanese Personal Credit Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Table 20: Japanese Personal Credit Cards Segment Size by Transaction Value (US$ Billion), 2009–2018

Table 21: Japanese Personal Credit Cards Segment Size by Transaction Volume (Billion), 2009–2018

Table 22: Japanese Commercial Credit Cards Segment Size by Volume of Cards (Million), 2009–2018

Table 23: Japanese Commercial Credit Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Table 24: Japanese Commercial Credit Cards Segment Size by Transaction Value (US$ Billion), 2009–2018

Table 25: Japanese Commercial Credit Cards Segment Size by Transaction Volume (Million), 2009–2018

Table 26: Japanese Debit Cards Category Size by Volume of Cards (Million), 2009–2018

Table 27: Japanese Debit Cards Category Size by Transaction Value (JPY Trillion), 2009–2018

Table 28: Japanese Debit Cards Category Size by Transaction Value (US$ Billion), 2009–2018

Table 29: Japanese Debit Cards Category Size by Transaction Volume (Million), 2009–2018

Table 30: Japanese Charge Cards Category Size by Volume of Cards (Million), 2009–2018

Table 31: Japanese Charge Cards Category Size by Transaction Value (JPY Trillion), 2009–2018

Table 32: Japanese Charge Cards Category Size by Transaction Value (US$ Billion), 2009–2018

Table 33: Japanese Charge Cards Category Size by Transaction Volume (Million), 2009–2018

Table 34: Japanese Personal Charge Cards Segment Size by Volume of Cards (Million), 2009–2018

Table 35: Japanese Personal Charge Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Table 36: Japanese Personal Charge Cards Segment Size by Transaction Value (US$ Billion), 2009–2018

Table 37: Japanese Personal Charge Cards Segment Size by Transaction Volume (Million), 2009–2018

Table 38: Japanese Commercial Charge Cards Segment Size by Volume of Cards (Thousand), 2009–2018

Table 39: Japanese Commercial Charge Cards Segment Size by Transaction Value (JPY Billion), 2009–2018

Table 40: Japanese Commercial Charge Cards Segment Size by Transaction Value (US$ Billion), 2009–2018

Table 41: Japanese Commercial Charge Cards Segment Size by Transaction Volume (Million), 2009–2018

Table 42: Japanese Prepaid Cards Category Size by Volume of Cards (Million), 2009–2018

Table 43: Japanese Prepaid Cards Category Size by Transaction Value (JPY Trillion), 2009–2018

Table 44: Japanese Prepaid Cards Category Size by Transaction Value (US$ Billion), 2009–2018

Table 45: Japanese Open-Loop Prepaid Cards Segment Size by Volume of Cards (Million), 2009–2018

Table 46: Japanese Open-Loop Prepaid Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Table 47: Japanese Open-Loop Prepaid Cards Segment Size by Transaction Value (US$ Billion), 2009–2018

Table 48: Japanese Closed-Loop Prepaid Cards Segment Size by Volume of Cards (Million), 2009–2018

Table 49: Japanese Closed-Loop Prepaid Cards Segment Size by Transaction Value (JPY Billion), 2009–2018

Table 50: Japanese Closed-Loop Prepaid Cards Segment Size by Transaction Value (US$ Million), 2009–2018

Table 51: List of JCB Card Issuing Partners, 2013

Table 52: Shinsei Bank – Key Financial Indicators (JPY Billion), Year Ended March, 2012–2013

Table 53: Shinsei Bank – Card Portfolio and Key Features

Table 54: Japan Post Bank – Key Financial Indicators (JPY Billion), Year Ended March, 2012–2013

Table 55: Japan Post Bank – Card Portfolio and Key Features

Table 56: Citibank Japan – Key Financial Indicators (JPY Billion), Year Ended March, 2012–2013

Table 57: Citibank Japan – Card Portfolio and Key Features

Table 58: Credit Saison – Key Financial Indicators (JPY Billion), Year Ended March, 2012–2013

Table 59: Credit Saison – Card Portfolio and Key Features

Table 60: JACCS – Key Financial Indicators (JPY Billion), Year Ended March, 2012–2013

Table 61: JACCS – Card Portfolio and Key Features

Table 62: Key Definitions

List of Figures

Figure 1: Japan – Benchmarking Payment Cards Channel Against Other Regional Markets

Figure 2: Japan – Growth of Various Card Categories (%), 2009–2018

Figure 3: Japanese ATMs Penetration, 2009–2018

Figure 4: Japanese POS Terminals Penetration, 2009–2018

Figure 5: Japan – Internet Users per 100 Inhabitants, 2009–2013

Figure 6: Growth of Contactless Cards in Japan (Million), 2009–2018

Figure 7: Japan – M-payments Value (JPY Billion), 2009–2018

Figure 8: Japan – Retail Sales Value (JPY Trillion), 2009–2018

Figure 9: Japan – Real GDP Growth Rate (%), 2009–2018

Figure 10: Japan – Nominal GDP Per Capita Income (US$), 2009–2018

Figure 11: Japan – Unemployment Rate, (%), 2009–2018

Figure 12: Share of Japanese Payment Channels (%), 2009 and 2013

Figure 13: Japanese Card Fraud (JPY Million), 2009 and 2013

Figure 14: Japanese Cards-Not-Present Fraud Value (JPY Billion), 2009–2013

Figure 15: Japanese Counterfeit Cards Fraud Value (JPY Billion), 2009–2013

Figure 16: Japanese Cards Lost or Stolen Fraud Value (JPY Million), 2009–2013

Figure 17: Japanese Card ID Theft Fraud Value (JPY Million), 2009–2013

Figure 18: Japanese Cards and Payments Industry Segmentation by Card Type

Figure 19: Japanese Volume of Outbound Business Tourists (Million), 2009–2013

Figure 20: Japanese Volume of Outbound Tourists (Million), 2009–2018

Figure 21: Japanese Outbound Tourists Spending (JPY Billion), 2009–2018

Figure 22: Japanese Card Spending by Retail Product Category (%), 2012

Figure 23: Japanese Card Spending by Retail Channel Share (%), 2012

Figure 24: Japanese Card Payments Channel by Card Category (%), 2009–2018

Figure 25: Japanese Card Payments Channel Size by Volume of Cards (Million), 2009–2018

Figure 26: Japanese Card Payments Channel Size by Transaction Value (JPY Trillion), 2009–2018

Figure 27: Japanese Credit Cards Category Volume and Penetration, 2009–2018

Figure 28: Japanese Credit Cards Category Size by Volume of Cards (Million), 2009–2018

Figure 29: Japanese Credit Cards Category Size by Transaction Value (JPY Trillion), 2009–2018

Figure 30: Japanese Cards Category Size by Transaction Volume (Billion), 2009–2018

Figure 31: Japanese Credit Cards Category Transaction Value Share Analysis by Channel (JPY Trillion), 2009–2018

Figure 32: Japanese Credit Cards Category Transaction Volume Share Analysis by Channel (Million), 2009–2018

Figure 33: Japanese Personal Credit Cards Segment Size by Volume of Cards (Million), 2009–2018

Figure 34: Japanese Personal Credit Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Figure 35: Japanese Personal Credit Cards Segment Size by Transaction Volume (Billion), 2009–2018

Figure 36: Japanese Commercial Credit Cards Segment Size by Volume of Cards (Million), 2009–2018

Figure 37: Japanese Commercial Credit Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Figure 38: Japanese Commercial Credit Cards Segment Size by Transaction Volume (Million), 2009–2018

Figure 39: Japanese Credit Cards Category Share by Scheme (%), 2013

Figure 40: Japanese Credit Cards Category Share by Issuer (%), 2013

Figure 41: Japanese Debit Cards Category Volume and Penetration, 2009–2018

Figure 42: Japanese Debit Cards Category Size by Volume of Cards (Million), 2009–2018

Figure 43: Japanese Debit Cards Category Size by Transaction Value (JPY Trillion), 2009–2018

Figure 44: Japanese Debit Cards Category Size by Transaction Volume (Million), 2009–2018

Figure 45: Japanese Debit Cards Category Transactions Value Share Analysis by Channel (JPY Billion), 2009–2018

Figure 46: Japanese Debit Card Transactions Volume Share Analysis by Channel (Million), 2009–2018

Figure 47: Japanese Debit Cards Category Share by Scheme (%), 2013

Figure 48: Japanese Debit Cards Category Share by Issuer (%), 2013

Figure 49: Japanese Charge Cards Category Volume and Penetration, 2009–2018

Figure 50: Japanese Charge Cards Category Size by Volume of Cards (Million), 2009–2018

Figure 51: Japanese Charge Cards Category Size by Transaction Value (JPY Billion), 2009–2018

Figure 52: Japanese Charge Cards Category Size by Transaction Volume (Million), 2009–2018

Figure 53: Japanese Charge Cards Transactions Value Share Analysis by Channel (JPY Billion), 2009–2018

Figure 54: Japanese Charge Cards Transactions Volume Share Analysis by Channel (Million), 2009–2018

Figure 55: Japanese Personal Charge Cards Segment Size by Volume of Cards (Million), 2009–2018

Figure 56: Japanese Personal Charge Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Figure 57: Japanese Personal Charge Cards Segment Size by Transaction Volume (Million), 2009–2018

Figure 58: Japanese Commercial Charge Cards Segment Size by Volume of Cards (Thousand), 2009–2018

Figure 59: Japanese Commercial Charge Cards Segment Size by Transaction Value (JPY Billion), 2009–2018

Figure 60: Japanese Commercial Charge Cards Segment Size by Transaction Volume (Million), 2009–2018

Figure 61: Japanese Charge Cards Category Share by Scheme (%), 2013

Figure 62: Japanese Prepaid Cards Category Volume and Penetration, 2009–2018

Figure 63: Japanese Prepaid Cards Category Size by Volume of Cards (Million), 2009–2018

Figure 64: Japanese Prepaid Cards Category Size by Transaction Value (JPY Trillion), 2009–2018

Figure 65: Japanese Open-Loop Prepaid Cards Segment Size by Volume of Cards (Million), 2009–2018

Figure 66: Japanese Open-Loop Prepaid Cards Segment Size by Transaction Value (JPY Trillion), 2009–2018

Figure 67: Japanese Closed-Loop Prepaid Cards Segment Size by Volume of Cards (Million), 2009–2018

Figure 68: Japanese Closed-Loop Prepaid Cards Segment Size by Transaction Value (JPY Billion), 2009–2018

Figure 69: Merchant Acquirer Market Share in Japan (%), 2013

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