The headline is 'Cashless Payment Ratio: 58%'
Headlines usually feature just one number.
History's lessons for today's decisions ／ How to Interpret News
How to read the news — Reading "cash is disappearing" from the denominator
What does the headline "Cashless Ratio Surges" say has increased?
Understand in 3 Minutes: How to Read the News About 'Cash Disappearing'
1See it
Swipe to see more
Without looking at the denominator, you can't tell what has decreased.
2024 → 2025
From 42.8% to 58.0%. It looks like a 15-point increase in one year.
From 2025, the yardstick changed. Imputed rent and other items were removed from the denominator.
The new yardstick gives a result that is 8-9 points higher.
If you're going to compare two years, you should use the same yardstick.
2024
At stores in the Eurozone, cash was used for 52% of transactions by count, and 39% by value.
New Year's Eve 2025
Banknotes carried over into the new year amounted to 120.6 trillion yen.
18.32 billion notes
Try counting your own payments for one week, both by number of transactions and by total amount.
2In numbers
52%
Percentage of in-store payments made with cash in the Eurozone (2024, by count). The picture changes depending on how you count.
82.7%
In 2025, the share of credit cards in Japan's 'non-cash' payments by value.
120.6trillion yen
Banknotes carried over on New Year's Eve 2025. The percentage of use and the total amount in circulation are two different numbers.
3What would you do?
The newspaper says, 'Cashless ratio up 15 points in one year.' How do you interpret this?
Pick one
People are quickly moving away from cash.
From 2025, the yardstick changed, and imputed rent for homeowners was removed from the denominator. It says the new yardstick gives a result that is 8-9 points higher. You should compare the two years using the same yardstick.
I'd check if the yardstick has changed.
That's right. The 42.8% for 2024 and 58.0% for 2025 are numbers from different yardsticks. When the definition of an indicator changes, you shouldn't compare it with the previous year.
The picture also changes depending on whether you look at the number of transactions or the total value. Try counting your own payments for one week using both methods.
4Read more
When to use The day you saw figures on payment ratios or "cash decline" in the newspaper or on TV.
Headline
"Cashless Payment Ratio 58%," "Decline of Cash Accelerates." Headlines feature a single number. Without looking at the denominator of that number, you cannot know what has decreased.
The content of the number
The Ministry of Economy, Trade and Industry announced the cashless payment ratio for 2025 as 58.0% (162.7 trillion yen). This is a ratio by value, with the denominator being domestic consumption expenditure. The previous year, 2024, was 42.8% (141.0 trillion yen). It appears to have risen by 15 percentage points in one year, but from 2025, it changed to a "domestic indicator," and imputed rent for owner-occupied housing, among other things, has been excluded from the denominator. The ministry notes that based on 2020-2024 data, the domestic indicator is 8-9 percentage points higher. If you are to compare two years, you should use the same indicator.
Number of transactions and value
Even for "non-cash," the picture differs between value and number of transactions. In 2025, the breakdown of the numerator by value is: credit cards 82.7%, code payments 10.2%, and e-money 3.7%. In the Eurozone, the European Central Bank counts by number of transactions. In 2024, cash accounted for 52% of point-of-sale payments by number of transactions and 39% by value. By number of transactions, cash is the most common method, while by value, cards are higher at 45%.
Remaining cash
The decrease in cash usage and the amount of cash remaining in circulation are measured by different figures. The Bank of Japan wrote in its 2020 policy that Japan's currency in circulation is high, at about 20% of nominal GDP. The banknotes in circulation at the end of 2025 amounted to 120.6 trillion yen, or 18.32 billion notes. A decrease in the share of cash in payments and a decrease in the amount of cash in circulation are two different events.
In your own case
How many of your payments in a week were in cash, and what was the total value of those cash payments? Counting by both number of transactions and value shows whether the figures in the article apply to you.
Procedure
- Look for the denominatorIs it consumption expenditure, the number of point-of-sale payments, or the amount of cash in circulation?
- Number of transactions or value?Cash tends to be higher by number of transactions, cards by value.
- Was it a year the metric changed?In a year when an indicator's definition changed, do not compare it with the previous year.
- Also look at the remaining amountThe usage ratio and the amount in circulation are different figures.
In other countries
In the Eurozone, cash was the most frequent means of payment at the point of sale by number of transactions in 14 out of 20 countries in 2024. For people aged 65 and over, cash accounted for 57%. The fact that the same "decrease" can look different depending on how it is counted is true regardless of the country.
Bibliography
- The Cashless Payment Ratio for 2025 Has Been CalculatedMinistry of Economy, Trade and Industry
- The Cashless Payment Ratio for 2024 Has Been CalculatedMinistry of Economy, Trade and Industry
- Study on the payment attitudes of consumers in the euro area (SPACE) – 2024European Central Bank
- The Bank of Japan's Approach to Central Bank Digital CurrencyBank of Japan
- How many banknotes move in and out of the Bank of Japan? Also, what is the total value of banknotes circulating in Japan?Bank of Japan (Tell me! Nichigin)
Related Lectures and Notes
P7 P2 Five questions before using a new payment method — Whose liability? Ledger? Pay now or later? Reversibility? Contact for issues?
Back to "Everyday Money: Calculations and Procedures" listPrice
After purchase, the full courses, the illustrated books, every country’s story and the numismatics examination are open to you.
See the price →