MITO, IBARAKI PREF. – Ibaraki Prefecture is adopting cashless payments made using smartphones as a means to tap into data-driven marketing, and allow small and medium-sized businesses to benefit from a central government plan to offset a scheduled consumption tax hike by rewarding consumers for noncash purchases.
Prefectural officials on Tuesday signed an agreement with Tokyo-based startup Origami Inc., a QR-code payment service provider, in the hopes of using the payment data as it seeks new tourism development strategies, and to invigorate the local economy, the officials said.
The deal “will help increase consumption and enable us to benefit from data-driven marketing,” Ibaraki Gov. Kazuhiro Oikawa said during a ceremony held Tuesday to commemorate the deal. “I want Ibaraki to become a promoter of cashless payments.”
Those who wish to pay without cash will need a smartphone to do so.
At stores that provide the service it will be possible to make transactions via the downloadable Origami Pay app, which requires users to register their credit card or bank account information.
Under a government plan, details of which are still under discussion, reward points — expected to be worth 5 percent of purchases made at small shops — will be returned to purchasers that use credit cards or other cashless payments, in an effort to reduce the economic impact of the planned consumption tax hike set for October. At the same time, the government hopes the plan will help sustain small businesses.
Ibaraki will first test cashless payments at stores located near Kairakuen, a famous plum blossom viewing spot in the city of Mito, as well as at public facilities in the prefecture, around the time of the Mito Plum Blossom Festival in mid-February.
The officials will later analyze the data gathered from cashless payments at designated stores and facilities to gauge consumer sentiment and financial performance.
To encourage consumers to pay with their phones, local merchants will offer purchase discounts for first-timers and distribute half-price coupons that can be used at stores in Mito.