Japan market research

Why many international brands struggle in selling online in Japan?

Which payment methods are preferred by Japanese customers when purchasing online ?

Preferred online payment methods in Japan

Credit card
Convenience store
Internet banking
Bank Transfer
Cash on delivery
Source: eShopworld

Why do people have but don’t use credit cards?

JCB reports that the penetration rate of credit cards in Japan is 85%, and that the average number of credit cards per individual is around 3.2. Such numbers are comparable with the ones of the US, but only 17% of Japanese people purchases actually happens through credit cards


Japanese people value their privacy and data protection

Even if credit cards systems are nowadays encrypted and protected, you still have to insert all your personal information to complete a purchase.

Fear of fraud

Using credit cards could make them feel exposed to fraud issues, from dataleaks to actual scams and unauthorized transactions.

Presence of valid payment alternatives on the market

Most online stores in Japan, starting from giants Rakuten and Amazon, offer cash-based alternatives to credit cards payment, between which cash on delivery or the ability to pay atconvenience stores.

Debt is seen as something risky to stay away from

Credit cards work on “debt-based” premises: a customer receives now, a good or service whichwill be accounted for at the end of the month. Japanese people, strongly adverse to risk, can see this as incurring in a real debt, and therefore exposing themselves to an unnecessary level of risk.

Konbini (Convenience Store) Payments

The diffusion of convenience stores in Japan is just impressive, and through the years the variety of goods sold has been integrated with additional services, from paying bills tore-charging prepaid cards and paying and receiving online purchased goods.

Many online stores provide, between their payment options, the possibility for their customers to place an online order, receive an anonymous receipt and bring that receipt to a convenience store, were they will be able to pay directly in cash at the counter or make a bank transfer online or offline through the ATM stations present at the convenience stores.

This allows customers to pay with cash or directly from their bank account without exposing their personal data, and once the payment is placed the order will be released and reach the customer, either at his/her home, office, or at an actual konbini.

From a merchant perspective, konbini payments allow on one side to have a wider reach, but at the same time cope with therisk of keeping inventory blocked until customers finalize their payment (or the payment deadline expires).

Cash on Delivery

While almost disappearing in many countries, COD (cash on delivery) survives strongly in Japan
Allowing customers to pay at the door when they receive the purchased items. MajorJapanese carriers like Yamato and Sagawa, usually offer this option for an average extracharge of 400¥ for orders worth less than 30,000¥.

Delayed Payments / “ATOBARAI”

Another very common form of payment is the so-called “atobarai”, literally “pay later”. Big chains like Uniqlo use for example NP Atobarai, which not only allows delayed payments and features a points program for customers who use it, but also covers the merchants in case of missing payments


The customer makes an online purchase, choosing “atobarai” as payment system


Product receive

The customer receives the product and checks it



The atobarai sends, separately or together with the product depending from case to case, an invoice to the customer.



Once the customer receives the invoice, he/she has a determined amount of time to pay it at the konbini, post office, or bank.

Giants like PayPal are still struggling to make their way through theJapanese ecosystem
To conclude, we hope that this quick overview on Japanese online payment systems has given you a grasp of the peculiarities of an extremely interesting, high promising, but sometimes complicated market. Giants like PayPal are still struggling to make their way through the Japanese ecosystem, and we expect more Asian payment gateways to enter the market in the near future.