Famous for sake, sushi and samurai, Japan has traditionally seemed too remote, too foreign or too expensive for the average westerner to consider for a holiday.
However, with visitor numbers to Japan from Australia (+7% Aug 2018 v Aug 2017), the USA (+12% Aug 2018 v Aug 2017) and Europe (+13% H1 2017 v H1 2018) all on the up and total visitor numbers at an all-time high, 21.3million YTD Aug 2018, all of that is quickly changing.
In 2017 Japan welcomed 28.7million visitors having reached its government-mandated goal of 20million annual tourists by 2020, five years ahead of schedule. In light of this growth, Prime Minister Shinzo Abe has confirmed that the government will boost efforts to achieve a revised target of 40million annual visitors by the same year as it seeks economic growth through tourism.
Backing these efforts and attracting unprecedented numbers to the country are the upcoming Rugby World Cup in September 2019 where estimates put visitor numbers at over 400,000 and the Olympics in 2020 where over 900,000 spectators are expected to visit the Japanese capital every day.
Naturally, the economic impact of these visitors is not limited to air travel and accommodation. Locally; restaurants, retail outlets, tourism hotspots outside of the main sporting attractions and domestic tour and travel operators are expected to enjoy a windfall from the boost in numbers.
However, are these local merchants and retailers’ best prepared to accommodate and serve the expected volume of visitors?
While innovative in almost all areas of technology, Japan has been reluctant to give up the use of liquid currency. Unlike the majority of western markets, hard cash is still the order of the day in the Land of the Rising Sun followed closely by Credit and Debit Cards with a limited number of mobile wallet transactions. But what does that mean for the local merchant and indeed for their potential international customers?
Japan’s popularity as a destination for its Asian neighbours is evidenced in the numbers. The volume of tourists visiting from China in 2017 eclipsed those from anywhere else in the world at 7.35m visitors followed by those from Taiwan, South Korea, and Hong Kong. Visitors to the upcoming Rugby World Cup however will comprise a more international mix. Globally, research finds that travelers are opting to take less cash and rely on credit and debit cards when making payments abroad. Critical to catering for the expected increase in these international visitors is in offering them transparent and convenient payment options by card.
Irish based international fintech Company, Fexco has been partnered with Mitsubishi UFJ Nicos, Japan’s largest credit card acquirer, for 5 years providing Fexco’s Dynamic Currency Conversion (DCC) solution to many merchants.
Pioneered by Fexco, DCC allows international cardholders to make payments in their home currency enabling them to better determine value on a transaction in a currency they are familiar with. This partnership provides real market insight to both Fexco and MUN who have witnessed the tremendous growth in the tourism and hospitality sectors.
Merchants and retailers wishing to leverage the increase in tourists to Japan while simultaneously delivering the famed Japanese service to their guests can seamlessly integrate Fexco’s DCC solution.