By Irene Wang and Kantaro Komiya
TOKYO (Reuters) – Japan on Wednesday began issuing the first new banknotes in two decades, featuring three-dimensional portraits of the founders of financial institutions and women’s educational institutions in an effort to crack down on counterfeiters.
The banknotes use printed patterns to generate holograms of the portraits that face different directions depending on the viewing angle. The technology will be the world’s first for paper money, according to Japan’s National Printing Bureau.
“The new bills show faces of people who represent Japanese capitalism, women’s empowerment and technological innovation,” Prime Minister Fumio Kishida told a meeting.
The move comes as the economy enters a growth phase for the first time in three decades, he added.
Although existing banknotes are still in use, train stations, parking lots and restaurants are busy modernising payment terminals. The government wants to encourage consumers and businesses to use less cash in its drive to digitalise the economy.
The new 10,000 yen ($62) note features Eiichi Shibusawa (1840-1931), the founder of the country’s first bank and stock exchange, often called “the father of Japanese capitalism.”
The new 5,000 yen note features the teacher Umeko Tsuda (1864-1929), who founded one of the first women’s universities in Japan. The 1,000 yen note features the pioneering medical scientist Shibasaburo Kitasato (1853-1931).
The currency authorities plan to print about 7.5 billion newly designed banknotes by the end of the current fiscal year. They will add to the 18.5 billion banknotes worth 125 trillion yen that were already in circulation in December 2023.
“Cash is a safe means of payment that can be used by anyone, anywhere, at any time, and it will continue to play an important role,” said Kazuo Ueda, Governor of the Bank of Japan.
The central bank is experimenting with digital currencies, but the government has not yet decided on issuing a digital yen.
‘NO IMPACT ON SALES’
The first paper money overhaul since 2004 prompted businesses to modernise their payment terminals for customers who prefer to use cash.
In Japan, cashless payments have nearly tripled in the past decade, reaching 39% of consumer spending by 2023. According to the government, they still lag behind the rest of the world and this percentage should rise to 80% to boost productivity.
According to the Japan Vending Machine Manufacturers Association, about 90% of bank ATMs, train ticket machines and store cash registers are ready for the new notes, but only half of restaurant ticket machines and parking meters are.
Nearly 80% of the country’s 2.2 million vending machines also need to be modernized, the report said.
“It may take until the end of the year to respond to this,” said Takemori Kawanami, an executive at ticket machine company Elcom. “That’s too slow, but we’re short on parts,” he added, as customer orders for upgrades exceeded expectations.
Many Japanese fast food restaurants, such as ramen and beef bowl restaurants, are using ticket machines to reduce labor costs. However, some small business owners struggling with inflation are unhappy about the extra investment that the new laws will bring.
“The replacement of the machine has no impact on sales, so for us it is only negative, on top of the rising costs for labor and ingredients,” said Shintaro Sekiguchi, who spent about 600,000 yen on ticket machines at three ramen restaurants he runs in Tokyo.
($1=161.6500 yen)
(Reporting by Irene Wang; additional reporting by Takahiko Wada; writing by Kantaro Komiya; editing by Clarence Fernandez and Stephen Coates)
