One of the largest financial services company in Japan is planning to issue its digital currency that will enable cashless payments and lower fee on transfers.

Other than facilitating instant money transfers, using cryptocurrencies for payments also helps users save money by doing so at a lower fee compared to the existing methods.

Mizuho Financial Group Inc., one of three so-called Japanese “megabanks” has decided to issue its own digital currency. The new currency will enable users to make cashless money transfers via smartphones and facilitate transfers among users with no fee.

The currency will be the first to be issued by a megabank and is expected to be launched by March 2019. The development was reported earlier on Friday by The Japan News.

Details of the Project

Mizuho has already onboarded 60 regional banks and is aiming to partner with more regional banks for the project which is tentatively being called the J-Coin scheme.

With the new service, users will be able to make payments at merchant stores by scanning a QR code by an app on their smartphones. Users will also be able to send money from their bank accounts to the app and vice versa.

Merchants that currently accept payments using credit cards or e-money, pay commissions to the payment processing firms. Under the J-Coin project, merchants will benefit as the commissions will be very low.

Mizuho has made it possible for the regional banks that are part of the project to issue coins with their own branding.

Future Use-Cases

The firm, in the future, plans to enable salary payments with the J-Coin and tie-up with Alipay, the China-based online payment platform. With this partnership in place, foreign visitors to Japan will be able to transact smoothly in the country.

Talking about the J-Coin project, Tatsufumi Sakai, Mizuho Financial Group President said:

The business of financial settlements has become more important and is expected to continue to grow. So we have to take a serious approach.

According to Sakai, the firm intends to use the data collected from the new payment service for its future businesses. The bank is exploring partnering with information technology companies to implement new technologies.

Mizuho is planning to launch a new bank in partnership with LINE, the most popular messaging application in Japan.

Sakai said:

We’ll do business with other companies if we have the opportunity. Timing and speed are very important. There is a limit to how much we as a financial institution can develop just through our conventional businesses. We’re focusing on new technology.

Japan holds the distinction of being one of the early adopters of cryptocurrencies. The push by one of the three megabanks in the country to take a digital currency mainstream augurs well for the entire blockchain industry.

What are your thoughts on the development at Mizuho? Let us know in the comments below.

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