Google is looking to enter into Japan’s booming market for cashless services. The U.S. technology company has agreed to purchase payments company Pring to go on with its plans.
On Tuesday, Pring’s top shareholders – Metaps, Miroku Jyoho Service Co Ltd, and Nippon Gas Co stated that they would sell their combined 87% holding in Pring to Google. Metaps said it is selling its 45% stake for 4.9 billion yen ($44 million).
The deal will provide Google with the autonomy to offer financial services of its own rather than being dependent on partner banks and credit card companies. Google is reportedly set to purchase Pring for between $180m and $270m for all of the company’s shares.
Japan’s cashless payments market is still in its embryonic stage compared to other countries where the system is either fully developed or already making headway. The rate of adoption for cashless services in Japan has been quite slow but has begun to pick up pace as companies have begun to see the opportunity that lies in the market and want to leverage on the fact that the market is still infantile. Google plans on taking advantage of this opportunity with Pring and once the deal pulls through, it would increase both the adoption of cashless services and market competition.
Compared to 70-90 percent in South Korea and China, Japan’s share of cashless payments in retail transactions was just under 30% in 2020.
The tech giant, earlier today, got fined for failing to comply with temporary orders that France’s antitrust watchdog gave the company. The U.S. tech company was fined 500 million euros ($593 million) by France’s regulator for not complying with the orders it had given in a row with French news publishers. The French regulator also gave Google the next two weeks to design a proposal on how it plans to provide compensation for publishers and news agencies for the use of their content. Failure to do this would incur additional fines of up to 900,000 euros per day.
Top tech companies like SoftBank and Rakuten have shown support for cashless payments options and are encouraging Japanese consumers to move away from what can be described as a deeply rooted preference for cash.