Why Japanese people use cash instead of credit cards?

Cash culture in Japan

In Japan, people don’t use credit cards that much like those in overseas.
People usually use cash at a supermarket, a convenience store, etc. in Japan.
I myself use mainly cash if I go to a supermarket.
Depends on the amount I use, I decide whether or not use cash.

Why Japanese people don’t use credit cards like overseas?

Here I’ll show you the main reasons.

Possession rate of credit cards are not low but usage rate is 10 %

Somehow possession rate of credit cards are not low in Japan.
It says 2 to 2.5 credit cards per person.
The total number of credit cards is more than 250 million for its population 126 million.
It is above average actually compared to that of overseas’.

But when it comes to actual usage rate, it is about 10 %.
It becomes very low.

People have credit cards at least 2 per person but they don’t use it.


The reason Japanese mainly use cash instead of credit cards

  • Fear of losing and stealing
    I think one of the biggest reasons of Japanese people don’t use credit cards that much is because of the fear of dropping and stealing.

    Of course, cash is same if you drop it or have it stolen.
    But people feel the risk of illegal use is much larger than that of the cash.

    If you drop cash, you just lose the money you drop but if you drop credit card there is a possibility of illegal usage of an outrageous amount.

    And people also fear that their private information might be stolen at the same time.
    There is no leak even if your money has been stolen but not for credit card.
    It includes your information so there is a risk of information leak once your credit card has been stolen

    So people feel it is very dangerous when they lose it.

  • Sense of security for holding real money
    I think this is also very big reason.


    Money is money, not card, that if you use it, it disappears while card leaves you debt until its withdrawal date.
    You can’t use card as much as you want without care as it leaves you a large amount of debt in the end.

    But human beings (some people) tend to use card as much as they want contrary to cash as you can’t see its flow as real.

    That holds people back to use it.

  • Not having enough knowledge about credit cards
    To begin with, people might don’t have enough knowledge about credit cards.

    This includes I and we know simple merits such as getting point or special bonus sometimes but we don’t know the details of it.
    Such as its mechanism, compensation, other service, etc.

    Our lack of enought knowledge about credit cards might also make it a bit difficult thing to approach.

  • Social Safety in Japan
    Japan is very safe that no one try to steal money directly from you such as on the street.
    I might went too far as there are crime in Japan, too but the rate is very low compared to that of most of other countries’.
    So long as you don’t drop it, there is no problem to carry the cash.
  • No counterfeit bill circulated
    I think there are countries that counterfeit bill circulates.
    You can’t easily use a big money such as more than $100.

    But as long as I lived until today in Japan, I’ve never seen Japanese counterfeit bill.
    That you can use paper money without hesitation in Japan.
    Trust in Japanese bank increases the worth of its cash.

Public‐opinion poll Conducted by Cabinet Office

Questionnaire of Public‐opinion poll Conducted by Cabinet Office in 2016

Japanese Cabinet Office conducted Public‐opinion poll in 2016 about transaction of credit card against ages 18 and over.
1815 out of 3000 people responded the questionnaire and I picked up result of one of the questions here.

1050 people responded saying “No” or “Don’t want to use if anything” for using credit card.
And following is the main reasons.

1. Do not feel any inconvenience for not using credit card in daily life (55.4%)
2. There is a risk of card fraud by losing or stealing (41.3%)
3. There is a risk of card fraud by leaking of private information from credit card company or shop which applies credit card for payment (35.4%)
4. Fear of spending too much money over budget (33.7%)
5. Hard to understand the amount of money accurately every month (27.3%)
Source : Public‐opinion poll Conducted by Cabinet Office in 2016

As you can see top reason is Japanese people don’t feel any inconvenience for using cash in their daily lives.
Actually I myself do not feel any inconvenience for using cash as it is just an ordinary thing and all the stores accept cash.
Still I prefer card to cash as it is faster and no need to search for paper or coin every time when payment.

Second and Third reasons are as I expected.
People fear of card fraud.
Yes, certainly there is a risk of card fraud.
So people need to be careful and to acquire right knowledge about credit card.

Fourth reason is, yes I understand it.
Cash is good as we can not use money over our budget.
But for card, we can use over our budget, credit card might look like a kind of magical card.
But not, we have to payback later in real.
We have to understand there is no magic in credit card.

Last one is, yes it might be.
Still you can check all the transaction through web.

This is the result of Public‐opinion poll Conducted in 2016.
But I think the rate, that says “No or “I do not want to use credit card if anything”, has been decreasing now.

Then no place to use credit cards?

If you hear Japan is a cash culture, you might think I can’t use credit card in most of the places in Japan.

But it is not, rather you can use credit cards most of the places in Japan.
You can use it at a convenience store, supermarket, book store, shopping mall, department store, etc. but only at a small shop or small private shop you can’t use it.
So there are many places you can use credit cards but we just don’t use that much.

As for me

I also often use cash.
Especially when it comes to small things such as food, drink, etc.
One of the reasons is I’ve already gotten used to the cash culture of Japan since I was a child.
And before I hold credit cards I was also afraid of losing it and felt like it can be very dangerous.

But once I get it, I found that it is handy and easier than cash with merit such as point.
So now I use credit cards often at the same time except for small things that I buy at a supermarket.
I think the number of people who use credit cards has been increasing in Japan now.
If Japanese government also encourages us or do something for credit cards, we will use it much more.


I can say people do not have trouble in using cash and feel risk for using credit card, that’s the reason Japanese people don’t use credit card so much.

But Japanese government try hard to spread credit card more, especially toward Olympic in 2020.
Not only credit card but wifi, too.
I think the situation will have been much improved by the time of Olympic.

Anyway until then, when you come visit Japan, please carry Japanese yen with you always.
For risk aversion!!

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