Japanese currency changed to new banknotes starting from July 2024.

Japan is a country that beautifully blends modern technology with traditional practices. One aspect of its traditional culture that often surprises foreign visitors is the heavy reliance on cash, especially in certain types of establishments like snack bars and izakayas. This guide will help you understand Japan’s cash culture and ensure you’re well-prepared for a night out.

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The Cash Culture in Japan

While Japan is known for its advanced technology and convenience, it maintains a strong cash-based economy. Many places, including smaller establishments, prefer cash over credit cards or other forms of electronic payment. This is particularly true for snack bars and izakayas.
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Why Cash is King in Snack Bars and Izakayas

1. Traditional Practices:
   • Many snack bars and izakayas have been operating for decades and have maintained their preference for cash transactions. It’s a practice rooted in tradition and convenience.
2. Transaction Fees:
   • Credit card transactions incur fees for the business, which can be significant for small establishments. By using cash, these businesses can avoid such fees and manage their finances more straightforwardly.
3. Security and Trust:
   • Cash transactions are immediate and final, which reduces the risk of fraud or payment disputes. In close-knit communities, this fosters a sense of trust between the customer and the business.

Tips for Dining at Snack Bars and Izakayas

1. Always Carry Cash:
   • Make sure to have enough yen with you when you plan to visit a snack bar or izakaya. ATMs are widely available, including in convenience stores, which often have English-language options.
2. Check Before You Go:
   • If you’re unsure whether a place accepts credit cards, it’s wise to call ahead or check their website. Many establishments will clearly indicate if they only accept cash.
3. Be Prepared for Table Charges:
   • As mentioned earlier, many izakayas have a table charge (otoshi or sekidate) which is not included in the menu prices. Be prepared to pay this charge in cash as well.

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Cultural Etiquette

1. Respect the Custom:
   • Understanding and respecting the preference for cash shows appreciation for Japanese customs and makes your dining experience smoother.
2. Politeness in Payment:
   • When paying, hand your cash directly to the staff with both hands, or place it in the small tray provided at the counter. This is considered polite and respectful.

Alternatives and Modern Trends

1. E-Money and Mobile Payments:
   • While cash is still dominant, e-money cards (like Suica and Pasmo) and mobile payment options are becoming more popular in urban areas and larger establishments. However, their acceptance in traditional snack bars and izakayas is still limited.
2. Credit Cards in Urban Areas:
   • Larger cities like Tokyo and Osaka are gradually seeing more acceptance of credit cards, especially in tourist-heavy areas. However, it’s still best to carry cash as a backup.

Navigating Japan’s cash culture, especially in snack bars and izakayas, is an important aspect of experiencing local life. By carrying sufficient cash and understanding the reasons behind this preference, you’ll ensure a smooth and enjoyable dining experience. Embrace the tradition, enjoy the unique atmosphere, and have a great time exploring Japan’s vibrant nightlife!

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