A consortium of Japanese banks has confirmed plans to launch a new national digital currency in time for the Tokyo 2020 Olympics.
Now, and according to the Nikkei Asian Review and Financial Times, a consortium led by Mizuho Financial Group and Japan Post Bank have revealed its plans to unveil the new currency, which is indeed called J-Coin.
The FT says the new project, which has the support of Japan’s central bank and regulators, aims to develop technology to enable Japanese consumers to pay for goods and services with their smartphones.
Cash currently represents 70 percent of all transactions by value in Japan but such a heavy cash dependency incurs costs for banks and governments, according to the FT. Banks must pay to handle, transport and audit large amounts of cash, while governments risk losing tax revenue to undocumented cash-in-hand work or black market transactions.
The consortium of banks estimates that the adoption of a new digital currency could add ¥10 billion ($90 million) to the economy, according to the FT. J-Coin will be exchanged at a one-to-one rate with yen.
All this cashless talk is nothing new of course thanks to the rise of digital payments. Sweden and Demark, always progressive (and not just in fintech), are kicking the cash out with new apps and new deals. While over in Asia, the Bank of Korea is targeting a cashless society by 2020.
In terms of another digital currency, don’t forget the UBS-led effort to create a digital cash model for payments and settlement on blockchain. Lots of big names have shown an interest in that—such as BNY Mellon, Deutsche Bank, Santander, Barclays, Credit Suisse, Canadian Imperial Bank of Commerce (CIBC), HSBC, Mitsubishi UFJ Financial Group (MUFG) and State Street.
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