Major Japanese Banks Increase Their Efforts to Introduce Digital Yen

 Japan in its efforts to introduce digital currency (CBDC) starting in 2021, Japan's three major banks and 30 private institutions have agreed to collaborate to experiment with the digital yen.

Among those involved including several banks, Japanese brokers, utilities and telecommunications firms and retailers agreed to collaborate to run experiments on the digital yen.

According to the joint manager, Hiromi Yamaoka, the private bank will be responsible for introducing Matawang although the prospects for the other parties involved are not yet being developed.

The Japanese are very careful in developing CBDCs, choosing not to rush to apply cashless payments. According to records, the use of cash in the country is budgeted to divide 80%, compared to 55% in the United States (US) and 30% in China.

The business is chaired by Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group, each of which has implemented digital payment systems and tokens before this.

They believe this latest project seeks to move away from 'silo-type' platforms and happier digital payment landscapes. They hope to compete with mobile payment systems such as PayPay, which is operated by SoftBank, Paytm and Yahoo Japan.

The introduction of the digital yen has also raised challenges against the Bank of Japan and private financial institutions in the introduction of the digital yen including large outflows from private bank deposits.

However, Yamaoka guaranteed that if the cooperation between the central bank and the private sector was widespread, the problem could be easily resolved.