The government will launch a smartphone-based rewards program in 2020 using the national My Number ID cards as part of measures to ease the impact of the consumption tax hike next month, sources close to the matter said.
The government is considering providing ¥5,000 worth of points to spend at stores across Japan to consumers who deposit ¥20,000 into their smartphone payment accounts, starting in October next year, the sources said Sunday.
There will be no income restriction on applicants to the program, and details will be disclosed soon at a Cabinet meeting on promoting digitization of public administration.
Some municipalities offer similar rewards programs to spur their economies and the government initially considered using them. But the plan was scrapped because their programs are available only in their areas, not nationwide.
The new program is expected to cost several hundred billion yen and will follow a similar nine-month ¥279.8 billion rebate program to promote cashless payments at small shops that launches next month. The consumption tax will be raised to 10 percent from the current 8 percent on Oct. 1.
The government will look into the feasibility of bringing forward the start of the rewards program to July 2020, in time for the start of the Olympics that month.
Partnering with mobile payment firms, the government will devise a system that will require consumers to first apply for a My Number card to be used as an ID to open an online account on the program’s website.
The government is trying to get more people to use their My Number cards, which had been issued to only 13.9 percent of the population as of Aug. 22. The card was introduced in 2016 as part of Japan’s new social security and tax number system and is aimed at simplifying administrative procedures.
More mobile settlement services are becoming available as companies such as Rakuten Inc. and Line Corp. offer smartphone-based payments based on QR codes and other methods.