Japan is known as the country where credit card usage penetration is still quite low, which makes merchants look for alternative payment methods to offer on their online store. In this article we will discuss one of the most popular alternative payment methods in Japan, convenience store payment.
What is convenience store payment?
With over 40,000 convenience stores present in all 47 prefectures in Japan, convenience store payments are the 2nd largest payment method after credit cards. Available 24 hours 7 days a week, convenient stores make it easy for customers to make payments at the time that suits them best, and, unlike pay-on-delivery, don’t make customers wait at home to pay.
What is the benefit of convenience store payment?
Simply put, introducing convenience store store payments allows merchants to target two main groups of customers: those who can’t use credit cards and those who don’t want to.
The first group includes the less tech savvy older generation, who avoids using credit cards on the one hand, and the younger generation, who doesn’t yet have a bank account, on the other. Introducing konbini payments helps you to expand your customer base by offering customers who can’t use credit cards a safe and convenient payment method.
On top of that, many people in Japan don’t trust the websites with their credit card information, and therefore quite often abandon their shopping carts if there are no alternative payment methods. Adding the second most popular payment method will help you to significantly decrease cart abandonment rate.
How do KOMOJU konbini payments work?
Unlike other payment gateways, KOMOJU doesn’t have an initial sign-up or monthly fee, instead, there’s a 2,75% transaction fee on all purchases. Sales are paid out on a weekly or monthly basis, where at the end of the payout cycle your sales without the transaction fee are wired to your bank account. Note that convenience stores have a transaction fee of 190 yen which should be borne by the customer.
Tips for getting the convenience store payments right
- Make it clear to the customer that your online shop supports convenience store payments. Display the icons of the major convenience stores along with supported credit card brands and other payment methods in the payment section or in the footer of the website. This will make the purchasing decision easier for the customer.
- Clearly state the transaction fee for the customer. It shouldn’t come as a surprise for the customer to see a transaction fee at the end of the checkout. To avoid customer dissatisfaction and cart abandonment, include the fee on the payment selection screen.
- Be aware of the KOMOJU refund policy. In case of the refund, KOMOJU will wire the refund amount to the customer through a bank transfer. A commission of 1,500 yen per transfer will be applied to the merchant. The refund amount will be deducted from the next sales payment to the merchant, and the transaction fees will not be reimbursed.
Convenience store payments continue to be one of the biggest payment methods in Japan. Adding it together with mobile payments, you will significantly increase your customer base and stand out from the competition.