Ripple, a leader in distributed ledger technology (DLT), announced its collaboration with over 50 Japanese banks to develop a new payment infrastructure. This collaboration aims to digitize payments in a country still heavily reliant on cash.
Cash Usage in Japan
Despite the global dominance of digital payments, Japan remains a cash-preferred nation. According to studies, 90% of Japanese prefer cash for payments, which is significantly higher compared to other developed countries. About 52% of Japan’s $17 trillion worth of financial assets are held in cash.
Ripple's Breakthrough in Japan
Ripple has been active in Japan for years, working with partners like SBI to promote the use of XRP and the XRP Ledger. Recently, the company announced the creation of a consortium of over 50 Japanese banks to develop a new payment system based on Ripple's technology. This system aims to replace the existing domestic payments infrastructure known as Zenghin and has the capability to handle cross-border payments.
Blockchain Payments and the Future
The Japanese government has been promoting the digitization of payments for the past five years, although security and reliability concerns remain. Many residents are still worried about the potential leaks and financial losses. Blockchain payments, such as those offered by Ripple, can be an ideal alternative. By reducing costs and increasing the efficiency of financial operations, the adoption of XRP technology is planned for use in all participating banks by 2025.
Ripple and Japanese banks are taking steps to radically modernize the country's payment system using distributed ledger technology. These changes could have a significant impact on Japan's financial sector, enhancing its efficiency and security.
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