Bank of Japan Launches Digital Yen to Encourage Adoption of Digital Version of their Currency

The Bank of Japan launched a series of discussions with 60 companies on a pilot programme for developing a digital yen on July 20, joining peers around the world in increasing efforts to issue digital versions of their currencies for retail use.

The discussions will cover a variety of topics, including the business and technological aspects of retail settlements using a central bank digital currency (CBDC), according to a statement from the central bank.

The BOJ has stated that no decision on whether Japan will issue a digital yen has been made, which must be made by the government and parliament.

However, many large Japanese corporations were among the 60 firms chosen to participate in the discussions, indicating that Japan is steadily moving towards globalisation.

Aside from megabanks and regional lenders, the group included electronics behemoth Sony, convenience store operator Lawson, Toyota's financial arm, and East Japan Railway.

Central banks around the world have been researching and developing digital versions of their currencies for retail use in order to avoid leaving digital payments to the private sector as the use of cash declines.

The Bank for International Settlements (BIS) found in a survey published earlier this month that nearly two dozen central banks from emerging and advanced economies expect to have digital currencies in circulation by the end of the decade.