According to a New York Times report, three major Japanese banks are planning to set up a study group to explore the benefits of developing a common settlement infrastructure for digital payments. Mitsubishi UFJ Financial Group Inc, Mizuho Financial Group Inc, and Sumitomo Mitsui Financial Group are the three leading banks of Japan that will form a study group to explore digital payment infrastructure in the country.
DeCurret will serve as the group’s organizer.
East Japan Railway and several other non-financial firms are also planning to participate. The local crypto exchange, DeCurret, will serve as the group’s organizer. The officials from the exchange noted that representatives from the Bank of Japan, the Ministry of Finance, and the Financial Services Agency would attend the meetings as observers. The group will meet twice a month from June through September 2020. According to the report, the Japanese are among the most cash-using population in the world, and the government is trying to reduce this trend and instead promote cashless transactions amid the coronavirus pandemic.
The group will work to enhance the inter-operability of digital currencies and infrastructure.
Hiromi Yamaoka, a former central bank executive who will chair the group, said that the country already has numerous digital payment systems, but citizens are refraining from employing them fully. Hence, they are yet to overwhelm the usage of cash, he added. The former central bank executive also said that the group would search for other solutions, as one of them “could be to enhance the inter-operability of digital currencies and infrastructure.”
Several central banks around the world are researching CBDCs, and China is expected to issue its digital Yuan sometime this year. However, the Deputy Governor of the Bank of Japan argued that CBDCs could benefit developing countries but are unnecessary for advanced economies such as Japan. In the midst of the pandemic, people are more inclined towards using digital payment methods to avoid physical human contact.
