Nearly 5 million people in Japan live with dementia and thousands are going missing from their homes and carers every month.

In Japan's second biggest city, Osaka, Atsuko Hajihata is frantically looking for her missing grandfather Akinori Matsuyama.

For the last several months she has been handing out leaflets on street corners and train stations, asking people to contact her if they see her grandfather.

He walked out of the family home in January and has not been seen since. Ms Hajihata says she is nervous because she thinks he has dementia.

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"I still have hope of finding him but I've heard that bodies of drowned people have been found," she said.

"But maybe he's being looked after by people."

Some of the missing turn up in mental institutions or aged care homes.

One unidentified man has been living in a nursing home in Osaka since being rescued from a busy highway two years ago.

He has severe dementia and does not know his name or where he came from. There is no information that can help identify him.

His carer asks "can you remember anything?", but the man does not reply.

The staff at the nursing home have given him the name Taro so he can receive welfare benefits.

They believe he is about 70 and have even given him a fictitious date of birth so they can celebrate his birthday.

"Taro is not his real name so staff have mixed feelings about doing this," his carer said.

"[It is] painful to think he'll die without ever being identified."

But tragically many of the missing are found dead.

Kenzo Yohizawa left his home while his wife was preparing dinner. She wrote his name and address on his shoes but Kenzo left in his sandals.

Three weeks later he was found frozen to death beside a river just 500 metres from his home. His wife believed he would return.

"I never imagined it and didn't think that he would die. I have regret and feel sorry that I wasn't able to find him," she said.

Ageing population means dementia problem will grow

It is hard to obtain exact figures of how many people with dementia go missing, but police estimates for 2012 are about 10,000.

Kumiko Nagata works at one of Tokyo's oldest and biggest aged care facilities, and says the problem is going to get much worse.

"In Japan, people over 65 exceed 25 per cent so the number of people missing with dementia will increase rapidly," she said.

"These days old people aren't living with their families; they often live alone or as elderly couples where both might have dementia. So they don't realise if one goes missing."

There is a network for missing persons but only 10 per cent of local governments are using it.

Most want a new system with much greater co-operation between police and government agencies.

In the meantime, communities are taking matters into their own hands, setting up non-profit groups like Missing Person Search (MPS) on the outskirts of Tokyo.

MPS is run by Hiroshi Tahara, an ex-police officer of 25 years.

"Everybody thinks if you report to the police they will actively search but they only really get involved if there has been an unusual death," he says.

Mr Tahara says the government should develop better registration systems and look at practical ways to stop the crisis.

He wants all dementia sufferers to wear shoes with a GPS function so they can be found quickly.