More rail firms in Japan to allow payment of fares by credit cards in 2024

More rail firms in Japan will allow commuters to pay fares using their debit and credit cards in a bid to make travelling easier for foreign tourists.

In November, three major railway companies in Japan’s western region of Kansai – home to the popular cities of Kyoto and Osaka – announced plans to install fare gates that allow the use of such payment modes by 2024.

Currently, commuters need to buy a paper ticket or an IC card from proprietary systems such as Suica, Pasmo and ICOCA, to take the country’s sprawling network of local and regional trains.

Since August, however, the sale of most Suica and Pasmo cards has been suspended indefinitely due to the ongoing global semiconductor shortage.

With the contactless payment option, passengers can pay their fares by tapping a credit or debit card or a smartphone linked to these cards at designated readers.

Kintetsu Railway and Hankyu Railway will start using such fare gates in 2024, while Hanshin Electric Railway will follow suit by the spring of 2025, said English-language daily The Japan News.

Compatible cards include those from Visa, JCB and American Express, the three firms said in separate statements on Nov 2. More details about Mastercard will be released at a later date, according to the statements.

The new option will be developed in partnership with payment companies as well as card issuer Sumitomo Mitsui Card and Quadrac, which specialises in transportation payment and authentication platforms.

The roll-out is expected to make travelling more convenient ahead of a projected surge in overseas visitors to the Kansai region due to the 2025 World Expo, which will be hosted by Osaka, according to The Japan News and Japan’s public media organisation NHK.

This roll-out joins plans by Osaka Monorail to introduce contactless payments by 2024, with Osaka Metro doing the same by March 2025, The Japan News reported.

The recent announcements come amid a nationwide push to bring railway networks up to speed with transport systems in places such as Europe, the United States and Singapore, where contactless payment with credit and debit cards is widespread.

In August, Nikkei Asia reported that over 70 rail and bus firms, including Kyushu Railway and Tokyu Railways, which operate commuter rail lines in the Tokyo area, plan to introduce the technology.

Tokyo Metro, which operates the capital’s subway lines, plans to trial a contactless fare payment system by March 2025, according to The Asahi Shimbun.

A handful of operators – like Nankai Electric Railway, which connects Kansai Airport and Osaka – have already transited to the new payment mode.

However, the fragmented roll-out by the various companies could lead to some snags.

With many railway companies operating services in Tokyo, it is possible that passengers enter one station with a credit card but are unable to exit another station that does not have a compatible system as it is managed by a different firm, The Asahi Shimbun reported.

A spokesman for East Japan Railway, which operates regional and high-speed trains in Tokyo and everywhere north of the capital until Hokkaido, also told the newspaper that it has no plans to launch tap-and-go credit card payments.

Instead, the company intends to grow the use of its Suica cards, which can be used for purchases at several major retail and food outlets, for non-train services to create an “economic zone”, the spokesman added.