Demand for ¥10,000 bills is steadily rising even as the population falls and the use of credit cards and other forms of electronic payment increases.
While more cash might sound like a good thing, some economists are concerned that it shows Japanese households are squirreling away money at home instead of investing it or putting it into bank accounts — where it can make its way back into the financial system and be put to productive use.
That’s a big problem for Prime Minister Shinzo Abe and his central bank chief, Haruhiko Kuroda, as they try to spur consumption and reflate the stuttering economy.
The mountain of cash amounts to almost ¥100 trillion ($890 billion), equivalent to about a fifth of the size of the economy. And last year the number of ¥10,000 notes, the biggest bill, rose 6.2 percent — the largest jump since 2002.
At major household goods chain Shimachu Co., sales of safes in the past month jumped about 40 percent from a year earlier.
“We can’t keep up with the production, resulting in supply shortages for some products,” a Shimachu official said.
At Cainz, a large home improvement retailer, safe sales have marked year-on-year increases of 60 percent to 70 percent since the turn of the year.
Sales began climbing after the launch of My Number, the national identification system for social security and taxation in January, pushed up by demand from employers, who are obliged by the scheme to keep employees’ numbers and other personal information secure.
But public interest in safes has grown since the central bank decided to adopt negative interest rates last month.
“The negative-rate policy is likely to intensify the preference of Japanese households to keep cash at home,” said Hideo Kumano, an economist at Dai-ichi Life Research Institute. “Overall, the trend of more cash at home reflects concern about the outlook for economy among households. This isn’t a good thing.”