How Hachi Pay and Local Digital Currency Systems in Shibuya, Tokyo, and Gifu Are Revolutionizing Japan’s Tourism Experience: Everything You Need to Know

Japan’s innovative digital community currency systems are playing a significant role in revitalizing local economies, especially in the wake of the pandemic. In places like Shibuya in Tokyo, Gifu, and Miyagi, these systems are helping boost both local spending and tourism. Hachi Pay, a smartphone-based currency system named after the famous Hachiko dog, has seen a massive uptick in usage, offering a generous cashback reward for residents and visitors alike. With communities benefiting from high refund rates and increasing numbers of local shops and restaurants adopting these systems, they provide a win-win situation for both businesses and consumers. Additionally, these digital currencies offer local governments a more efficient and cost-effective way to tackle economic challenges while encouraging tourism. Foreign visitors, in particular, have also found these systems an attractive option for exploring Japan’s local culture and businesses.

The Rise of Digital Community Currency Systems in Japan

Japan has long been home to a thriving culture of local currencies, which originated in the 1990s as a way to promote community spending and social interaction. These systems, which initially gained traction through physical tokens and paper-based currency, are now experiencing a resurgence in digital form. In cities like Shibuya, Gifu, and Miyagi, these digital currency systems are more than just a trend; they are an essential tool for revitalizing the local economy, attracting tourists, and promoting sustainability in the community.

One of the most notable examples is Hachi Pay, a digital currency launched by the Shibuya Ward government in 2022. This smartphone-based system has gained widespread popularity among locals and tourists alike, helping stimulate the local economy. Hachi Pay is used in over 4,300 merchant stores across Shibuya, and its success is attributed to its high cashback rewards, which have made it a preferred payment method for many consumers. The system is also designed to boost tourism, offering tourists a convenient way to make purchases and earn points during their visit.

How Digital Currency Systems Like Hachi Pay Boost Local Spending

The Hachi Pay system operates on the simple principle of offering cashbacks to users. For residents of Shibuya, the cashback is 8% of the purchase amount, while non-residents enjoy a 4% cashback. These points can be redeemed for future purchases, making it an attractive option for consumers looking to stretch their budgets. Additionally, the low commission rates for merchants—compared to traditional payment systems like PayPay—have led many local businesses to adopt Hachi Pay, further contributing to its success.

In Gifu and Miyagi, other regional currency systems, such as Sarubobo Coin and Natori Coin, have followed suit. These systems, which are funded through the central government’s Priority Support Local Allocation Grant, aim to ease the financial burden on local communities while simultaneously attracting tourists. The introduction of these systems has proven to be a cost-effective way for local governments to distribute financial assistance to residents while also encouraging visitors to spend in the region.

Digital Currencies as a Tool for Attracting Tourists to Local Communities

Tourists, both domestic and international, are increasingly drawn to Japan’s local currency systems because of their simplicity and practicality. Visitors can easily top up their digital wallets at convenience stores or through smartphone apps, making it a seamless part of their travel experience. This convenience, combined with the added benefit of cashback rewards, makes it an attractive option for tourists looking to immerse themselves in the local culture while also saving money.

In addition to Hachi Pay, other regions such as Shizuoka and Kagoshima have implemented similar systems like Sunset Coin and Toppa. These currencies not only facilitate local shopping but also promote sustainable tourism by encouraging travelers to purchase locally-sourced goods, such as fresh seafood in Nishi-Izu and unique local crafts in Hioki.

The Economic Impact of Digital Community Currencies in Japan

While the cashback rewards offered by these digital currencies benefit consumers, the economic impact is also significant for merchants. By keeping the merchant commission rates low—often as low as 1% for large-scale outlets and 0% for smaller businesses—these systems offer financial relief to businesses that have been struggling with rising costs. The introduction of these systems has helped increase the adoption rate among local businesses, allowing them to reach new customers, including tourists and non-residents.

The Shibuya Ward government, which spent approximately 1.4 billion yen in fiscal 2024 on supporting Hachi Pay campaigns, points, and other expenses, has seen significant returns on this investment. The total transaction volume for Hachi Pay reached approximately 10 billion yen, illustrating the growing role of digital currency systems in driving local commerce.

Challenges and Sustainability of Local Currency Systems

Despite their success, digital community currency systems face challenges, particularly when it comes to funding and sustainability. As noted by experts like Professor Rui Izumi from the Senshu University School of Economics, point refund systems funded by local governments could face financial pressures if they are not carefully managed. In some cases, local governments have had to suspend or scale back digital currency initiatives due to the high costs of operation.

For example, one local government in the Tohoku region had to cut back on its digital currency program after spending more on maintenance and system administration than it had received in transactions. However, Professor Izumi believes that these systems have a future, provided they can adapt and evolve to become more self-sustaining, perhaps by incorporating more private sector involvement and finding additional sources of funding.

Travel Tips: How Tourists Can Benefit from Japan’s Digital Currency Systems

• Download the relevant app: Before you travel, make sure to download the app for the digital currency system you plan to use, whether it’s Hachi Pay in Shibuya or Sarubobo Coin in Gifu.
• Top up in advance: You can add money to your digital wallet using a credit card or through ATMs located at convenience stores across Japan.
• Explore local shops and restaurants: Take advantage of the cashback rewards by shopping and dining at local businesses that participate in the program.
• Collect points: Use your points from Hachi Pay or other digital currencies to make additional purchases or to save on your next visit.
• Check with local tourism boards: Many regions in Japan now offer digital currency incentives to promote tourism. Check with the local tourism board for details on how you can benefit during your stay.

A Digital Revolution for Tourism and Local Economies in Japan

Japan’s embrace of digital community currency systems like Hachi Pay is not just helping to boost local economies; it’s creating a unique, convenient, and cost-effective way for tourists to explore the country. With more regions adopting similar systems, Japan’s digital currency revolution is helping to foster sustainable tourism, encourage local spending, and make the country’s vibrant cities and towns even more attractive to visitors.

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