While China has already successfully run the pilot test of its digital yuan, now Japan is getting ready to do the same.
In its attempt to catch up, Japan’s 30 major firms will begin experiments of issuing a private digital currency next year, said the group's organizing body on Thursday, reported Reuters.
The group consists of the three largest banks in the country, along with retailers, utilities, brokerages, and telecommunication firms. Using a common settlement platform, the group will conduct the experiments for issuing a digital currency. Hiromi Yamaoka, a former BOJ executive in an online briefing, said,
“Japan has many digital platforms, none of which are big enough to beat cash payments.”
“We don’t want to create another silo-type platform. What we want to do is to create a framework that can make various platforms mutually compatible.”
Recently, the Bank of Japan announced its plan to experiment with issuing a digital yen in a country where cashless payments make up only 20% of total settlement than China's 70% and the United States’ 45%.
Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group, and Mizuho Financial Group — the megabanks of Japan have already rolled out their own digital payment systems.
Yamaoka said while private banks will be in charge of issuing the digital currency in the experiments, other entities' prospects also issuing a digital yen won’t be ruled out.