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Originally Posted by Guido
Is it true that paying with your credit card in Japan is next to impossible?
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Japan is a cash oriented society. Unlike other countries, our credit cards are not issued according to how much debt you have paid (there is no such thing as credit reports), it's based on if you are wealthy enough to own one. The idea in other countries is that if you are rich, you can pay off your debt in a timely manner. However in Japan it is that if you are rich, you don't have debt to begin with. Hence, annual fees for credit cards can cost as much as 8000 yen for a normal one, whereas premium ones like American Express and Diners Club can cost upwards of 30,000+ yen or more.
It's just not practical for merchants to have credit card swipers as the cost is too high as well. So, you cannot go to McDonald's and try to get a happy meal to pay it with your credit card. You have to pay cash. If everyone pays by cash in the first place and that's how it is, why would a merchant have to pay an extra cash to install a credit card machine (which I heard it is pretty expensive and maintain each month)?
So, if you have a VISA or Mastercard and expect that it'll be accepted at a family restaurant like Jonathan's, you'll be surprised that most don't. So you better check the sticker on the entrance to see if that merchant accepts credit cards beforehand!!!
On the other hand, Japan's credit card system is well developed that you can choose "ikkatsu" or "bunkatsu." Briefly explained:
ikkatsu - charge it all at one shot. So if you buy a digital camera costing you 40,000 yen and choose
ikkatsu, it will charged 40,000 yen for that payment period.
bunkatsu - charge it in multiple installments (depends on what the dividing limit is). So if you buy a 40,000 yen digital camera and say
bunkatsu in 4 months, you'll get charged 10,000 yen x 4 payment periods/months (minus finance charges of course).
Unfortunately, this
bunkatsu system works only for Japanese issued credit cards. So, if it's a Mastercard issued by Citibank Japan, yes you can do
bunkatsu. But if you are a foreigner using a Mastercard issued by Citibank USA, then no - you only have the
ikkatsu option. The dividing amount varies by the issuer, but it is usually up to 12 months. And when the time for summer and winter bonuses looms near, merchants will ask you "do you want this to be charged at bonus time?" That means the charge will come in at around the time those summer (mid June) and winter (mid December) bonuses are deposited into your bank accounts.
The pros and cons for
bunkatsu system? Pro: You're able to charge it less each month. Cons: You end up paying a bit more in the long run due to finance charges.