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Japan’s prepaid card market offers an excellent opportunity for eCommerce businesses, especially when targeting younger consumers or online-savvy shoppers. These groups prefer prepaid cards for online purchases because they are easy to use and don’t require a traditional bank account or credit card. Moreover, as Japanese consumers continue shifting away from cash, prepaid cards are valued for their convenience and spending control.
Prepaid card revenue in Japan is expected to grow from USD 109.2 billion in 2024 to USD 455.3 billion by 2032, increasing at a rate of 16.7% each year. Prepaid cards in Japan are easy to buy at konbini (convenience stores), making them accessible to practically everyone in the country.
Understanding the prepaid card market can help you adapt and attract more customers in Japan. In this article, we’ll explore Japan’s eCommerce prepaid card trends and the drivers behind this growth.
Overview of Japan's Prepaid Card Market
The Japanese government has actively worked towards a cashless society, aiming for cashless transactions to reach 40% by 2025. With a record 39.3% in 2023, they are on track to achieve this goal. However, cashless transactions in Japan still pale in comparison to other Asian countries like China and South Korea, where the adoption rate exceeds 80% and 90%. This slow adoption is often attributed to Japan’s rapidly aging society and the deep-rooted preference for cash among its consumers.
Cashless payments grew popular during the coronavirus pandemic, as consumers avoided physical contact, and the government introduced reward point programs to encourage usage. Credit cards remain the dominant digital payment method, accounting for over 80% of all digital transactions, but QR code payments, such as PayPay and Rakuten Pay, have gained more popularity recently.
Prepaid cards in Japan act as a bridge between digital payments and the country’s cash-based culture. They combine the convenience of cashless transactions with accessibility, especially for teenagers under 18 who are not eligible for credit cards. Prepaid cards offer a simple alternative, allowing young users to make digital purchases for games, movies, and music—no bank account or credit card required.
In Japan, both physical and digital prepaid cards are widely available and can be used domestically and internationally, though there are some limitations. For example, a prepaid Visa or Mastercard meant solely for online use can only be used on websites that accept those cards, not in physical stores. Some cards are reloadable, while others are for one-time use. There are also restrictions, such as they generally cannot be used for recurring payments like rent, utilities, or even split pay.
Types of Pre-Paid Cards
In Japan, several types of prepaid cards play a role in the eCommerce and transport sectors, including:
- International Brand Prepaid Cards: Issued by networks like Visa, Mastercard, and JCB, these cards work in Japan and abroad. Some are reloadable, while others are for one-time use.
- Transport Cards: Cards like Suica, PASMO, and ICOCA are reloadable and convenient for daily use. They are mainly used for transportation but can also be used in stores and vending machines.
- Store-Specific Prepaid Cards: Cards such as nanaco (Seven-Eleven) and WAON (AEON) are linked to specific retailers. They can be recharged and used at participating stockpiles.
- Gift Cards: These one-time-use cards, such as Amazon, Starbucks, and STEAM cards, are used for online shopping or digital content. They cannot be reloaded.
Moreover, the prepaid card market in Japan is mainly divided into two types:
- Closed-loop cards: These are linked to specific businesses or retailers and offer rewards, promotions, and loyalty benefits.
- Open-loop cards: These cards can be used at many different merchants and locations, offering greater flexibility for consumers.
Benefits of Prepaid Cards in Japan's E-Commerce
Accessibility For All Demographics
Prepaid cards are widely accessible in Japan, largely due to the availability of convenience stores. As of 2024, there are over 58,000 convenience stores nationwide, including major chains like 7-Eleven, Lawson, and Family Mart. These stores often have kiosks offering a variety of prepaid cards for popular online platforms such as Amazon, Rakuten, iTunes, Steam, and V-preca by Visa, as well as digital prepaid cards like Webmoney available at terminals like Lawson’s Loppi.
Prepaid cards are available to consumers of all backgrounds—even short-term residents. Most cards have no age limit, but some may require users to be at least 12 or 15 years old, depending on the card. Offering prepaid cards on your eCommerce store also allows you to cater to customers who are wary of credit card risks or who prefer a link to cash-based transactions.
Privacy and Security
A large portion of Japan’s elderly population hesitates to adopt cashless transactions due to the learning curve associated with digital tools, such as mobile apps and digital wallets. Additionally, concerns about security risks contribute to this reluctance.
High-profile data breaches and criminal phishing scams, which often target the elderly, have made many in this demographic wary of digital transactions. Moreover, a digital transition faces a growing number of elderly with cognitive decline—expected to reach around 10 million by 2050—who are at risk of overspending if they have easy access to digital payment methods, especially when living alone (about 13% of the elderly population).
Prepaid cards offer a solution by providing an extra layer of financial security and privacy. They do not require bank account information, making them appealing to privacy-conscious Japanese consumers.
Budget Control for Consumers
Prepaid cards have become an essential budgeting tool in Japan. They only allow spending up to the loaded amount, making them a reliable, stress-free option for maintaining financial stability. By helping users allocate funds to different expense categories, prepaid cards make it easier to track and control spending. Many even offer digital apps for real-time tracking, providing a clear view of transactions and balances to help adjust spending habits as needed.
Prepaid cards also offer family-friendly features. The SMBC Family Wallet and Visa B/43, for example, let parents issue cards to children and monitor spending through apps. Visa B/43 also includes options for families and couples, notifying members of each other’s spending to keep everyone on track.
These features promote financial awareness and responsibility, whether teaching children how to manage money safely or helping couples maintain transparent budgets. For eCommerce owners, this means reduced risk of chargebacks and better customer satisfaction, as shoppers can avoid overspending.
Low Risk of Debt Accumulation
In 2023, outstanding credit card balances in Japan reached about 17.9 trillion yen. Most people in Japan prefer to pay off their credit card bills in full the next month, as using “revolving payments” or splitting payments to avoid interest is generally discouraged. If people do split a payment, it’s usually only for large expenses and over two or three months at most.
Prepaid cards are great for avoiding debt because you can only spend the money you load onto them. Unlike credit cards, there’s no risk of overspending or facing interest charges since you can’t go beyond your available balance. This makes prepaid cards especially appealing for people who want to stay in control of their finances and avoid the stress of debt.
Popular Prepaid Cards in Japan
Below are some of the most widely used prepaid cards in Japan:
- Au Wallet: Popular among au mobile network users, this card integrates with au services and offers points for spending.
- BitCash: A digital-only prepaid card designed for secure online shopping, often used for games and content services.
- BitCash: A digital prepaid service using a virtual balance, often for gaming or digital content, without the need for a credit card.
- D Card Prepaid: Linked to the NTT Docomo mobile provider, it provides reward points and is convenient for NTT Docomo users.
- MobalPay: Aimed at travelers and expatriates, it offers international usability, making it convenient for foreign residents in Japan.
- NetCash: Frequently used for online gaming and digital content, this card offers anonymous and secure transactions.
- SoftBank Prepaid Card: A virtual and physical card from Softbank.
- Vanilla Visa Gift Card: An anonymous prepaid option for shopping and gifting, accepted anywhere Visa is used.
- V-preca: A virtual, rechargeable Visa prepaid card. You can also apply for an in-store card.
- WebMoney: A popular online-only prepaid card in Japan. It’s often used for gaming and entertainment.
- Wise Debit Card: A favorite among expats. Wise allows international transactions and offers a Visa prepaid card.
Key Trends in Japan's Prepaid Card Usage for E-Commerce
Integration with eCommerce Loyalty Programs
Prepaid cards are typically connected to loyalty programs, allowing users to earn and redeem points. For example, the Rakuten Prepaid Card, accepted wherever JCB is accepted, is linked to the Rakuten Points loyalty program. Users earn points from Rakuten Group services, with each point worth one yen. They can also charge their card with points accumulated from purchases. This integration encourages more spending by allowing users to convert earned points into credit for future purchases.
Rise of Virtual Prepaid Cards
By 2028, digital prepaid card transactions are expected to account for nearly 60% of total prepaid card spending, with over 940 million cards issued digitally. Virtual prepaid cards are popular in Japan for reasons such as convenience and anonymity. They are widely used for purchasing in-game and digital content without the need to link a bank account or credit card. This makes them an ideal option for gamers of all ages, especially younger users.
These cards, such as Ameba Cards, music.jp Cards, and Mobage Cards, are commonly used for purchasing in-game currency, music, movies, and eBooks, without the need to link to a bank account or credit card. Typically disposable, they limit spending to the loaded balance, making them ideal for small purchases.
While these cards offer privacy and convenience, they, like physical prepaid cards, are still vulnerable to phishing scams, where attackers may create fake websites or messages to steal card details.
Shift Towards Mobile-First Prepaid Card Options
Today, many prepaid cards in Japan come with mobile apps that make them easy to manage. With these apps, users can check their balance, add money, and track their spending—all from their smartphones, without needing to visit a store or use a computer.
Most sign-ups are almost instant and done via phone or app, allowing users to start charging and using their prepaid card right away without waiting for long approvals. This is especially easy for prepaid cards connected to mobile services like Softbank or NTT Docomo, as they can be tied directly to the user’s phone bill.
Increased Adoption of Microtransactions
Prepaid cards are a popular choice for small purchases because they help users control their spending. Easily reloadable and linkable to accounts, they’re ideal for digital purchases like in-app items, gaming content, or streaming subscriptions. Those under 18 can buy prepaid cards without needing a credit card, providing an affordable way to spend on their favorite games and music.
For example, you can buy music, movies, games, or in-game currency by simply visiting a nearby convenience store and purchasing a prepaid card, often starting at ¥1,000 (about $10). Prepaid cards are also available for services like Netflix and Spotify, with options for 1-3 month or yearly subscriptions, so users don’t have to worry about using credit cards or accidentally renewing their subscriptions.
Expansion of Contactless Prepaid Options
The contactless payments market in Japan is predicted to grow at an annual rate of 20% through 2028. Improvements in wireless technology and the widespread use of smart devices, such as smartphones, smartwatches, and fitness trackers, have made it easier to link credit cards (and prepaid cards) to these devices for seamless contactless payments, both online and in-store.
Contactless payments make online shopping easier and faster by allowing users to pay with a tap of their smartphone or smartwatch or by scanning QR codes or entering payment codes. This eliminates the need to manually enter card details every time, speeding up the checkout process. It also improves security by encrypting payment information.
How to Optimize eCommerce Platforms for Prepaid Card Users in Japan
Offer Flexible Prepaid Card Payment Options
ECommerce platforms should offer popular prepaid cards in Japan to reach a wider customer base, particularly younger audiences who may lack access to credit cards or disposable income. Prepaid cards are crucial in industries like video gaming, where methods such as BitCash, NetCash, and WebMoney are trusted, providing a secure and controlled payment option.
This improves the shopping experience, boosts customer satisfaction, and encourages repeat business. For example, Tully’s Coffee saw a 20% increase in sales by introducing prepaid cards that offered discounts and membership promotions, helping to build customer loyalty.
Incorporate Prepaid Card-Specific Rewards and Discounts
By offering exclusive benefits like cashback, reward points, and special discounts, e-commerce platforms can motivate customers to use prepaid cards. For example, Rakuten’s prepaid card allows users to accumulate points from purchases and then use them to recharge the card, creating a rewarding spending cycle.
Similarly, SMBC’s Visa Prepaid Card program adds a 0.25% cashback benefit based on monthly spending, with an additional 0.5% cashback for recharging the card using an eligible Sumitomo Mitsui credit card.
WebMoney sees better engagement through regular campaigns, often tied to popular partnered video games, benefiting both the prepaid card service and the game companies by tapping into each other’s user base.
Enable Easy Mobile Integration
To maximize convenience for users in Japan, e-commerce sites and apps should be optimized for integration with prepaid cards in mobile wallets. Given the widespread use of smartphones for browsing and shopping, especially in Japan, where mobile payments are prevalent, having a mobile-friendly website is essential.
A better, optimized site for mobile users not only makes the user experience better but also improves search engine rankings. By enabling customers to easily add their prepaid cards to well-known mobile payment apps and complete transactions effortlessly, businesses can appeal to Japan’s growing number of shoppers who prefer quick payments via their smartphones.
Prioritize Security for Prepaid Card Users
Prepaid card security uses several measures to protect user information. Encryption makes card details unreadable to anyone who shouldn’t have access, while tokenization replaces sensitive data with unique codes that others can’t use. Other protections like Two-Factor Authentication, fraud monitoring, and following industry standards help prevent fraud and ensure safer transactions for users.
Nevertheless, just like credit cards, prepaid cards can be lost or stolen, so it’s important to handle them carefully and suspend their use if they go missing. They can also be misused by someone impersonating the card owner. In Japan, where users can buy “tickets” for virtual prepaid cards like WebMoney, it’s important not to lose the codes, as they can’t be replaced once lost.
Emphasize Localized Marketing for Prepaid Card Users
Users in Japan will expect localized marketing. For example, Prepaid service providers like Wise and Mobal, both foreign-owned enterprises, offer websites in Japanese and English, making it easy for Japanese users to navigate and access services while still appealing to an international audience.
Similarly, aligning promotions with popular Japanese holidays like Christmas, New Year, or Golden Week makes services feel more culturally relevant. Japanese users often expect benefits such as double points, discounts, or special offers during these times, and overlooking these cultural nuances may lead customers to choose competitors who better meet their expectations.
Summary
Japan’s prepaid card market is growing, creating opportunities for eCommerce businesses. Prepaid cards enable users to control their spending and maintain privacy, making them an ideal choice for consumers who want secure and straightforward transactions. The government’s push for cashless payments has accelerated this shift, with prepaid cards acting as a bridge between cash and digital payments. While credit cards remain dominant, prepaid cards appeal to those seeking greater control over their finances, particularly young people.
Businesses in the digital media and gaming industry should especially consider offering prepaid card payment options. These sectors attract a large, youthful audience that often prefers prepaid cards for digital purchases, such as in-game content, streaming subscriptions, and app downloads.
KOMOJU, a global payment service provider, supports several prepaid card options in Japan, including NetCash, BitCash, and WebMoney. To help eCommerce businesses utilize prepaid cards, KOMOJU provides an all-in-one platform with various payment solutions, including Japanese credit cards, QR Code payments options, and more. The platform handles payment processing, covering transactions, security, and integrations with eCommerce systems. With KOMOJU handling payment management, store owners in Japan can focus on running their business smoothly and growing sales. Sign up here.
FAQs
Here are the top-ranked prepaid cards in Japan:
- Kyash Card
- d card prepaid
- au PAY prepaid card
- Sumitomo Family Wallet
- Sumitomo Visa Prepaid
- JAL Global Wallet
- ANA JCB Prepaid
- SoftBank Card
- Epos Visa Prepaid
- Rakuten Bank Prepaid Card
- Kanmu Bundle Card
- WebMoney Prepaid Card
Prepaid cards help people control their spending by limiting how much money they can spend. In Japan, families and couples often use prepaid cards to share or limit budgets.
Prepaid cards are also easy to use with smartphones and digital wallets, making online purchases quick and secure. Many prepaid cards offer rewards or cashback, which can motivate people to shop more.
Prepaid cards are generally secure for online shopping in Japan. Many prepaid cards also have fraud detection systems and require authentication for transactions, adding extra security.
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