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A consortium of Japanese companies prepares to test the digital yen

A consortium of about 70 Japanese companies, including the country’s three largest banks, has announced plans to test the yen-based digital currency, followed by an official launch in fiscal 2022.

Image source: sergeitokmakov / pixabay.com

Image source: sergeitokmakov / pixabay.com

The digital currency, tentatively dubbed DCJPY, will be backed by bank deposits and will use a single platform that will accelerate large-scale transactions and simplify payments between companies. The consortium, which includes Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group, has held regular meetings since last year to establish ways to build a unified settlement infrastructure for digital payments. Three major banks of the consortium have introduced their own payment systems, but they lag behind the solutions of the PayPay service owned by SoftBank, which is not part of this organization.

However, the consortium includes other credit institutions, including Japan Post Bank, brokerage houses and insurance companies, as well as organizations outside the financial sector: Nippon Telegraph and Telephone Corp, Kansai Electric Power and East Japan Railway. Some of them will take part in test projects – during the tests, the use of digital currency in various industries from energy to retail will be assessed. This experiment could influence a pilot project of the Bank of Japan, which is considering the introduction of CBDC – the official digital currency.

It should be noted that the Japanese still prefer to use cash, which remains the main means of payment in the country. Nevertheless, the authorities are striving to promote non-cash forms of payment.

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Robbie Elmers

Robbie Elmers is a staff writer for Tech News Space, covering software, applications and services.

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