It has been several years since the words “digital cash” and other related terms were
introduced into the modern lexicon. Needless to say, the progress made in communication
and information technology (IT) has been rapid, and change in the area of digital
cash is no exception. The volume of such transactions is rising, yet analysis of this
revolution in payment is limited, particularly in the academic fields.
Although e-commerce has been growing rapidly and attracting much attention, digital
cash has not been a focus of such attention. Digital cash has some problems associated
with it that need to be solved before its use can continue to grow, and the rate of
growth is slowing at present. The logic behind replacing cash, checks and magnetic
credit cards with digital cash is bound to prevail in the end, but there are many barriers
that need to be overcome.
The author proposes that material cost reduction and service price are cutting resultant
factors of the demand for electronic wallet transactions and the means by which digital
cash can spread, the technology of IC (integrated circuit) card reformation can be
developed, and price cutting on the supply side can occur. The popularity of the personal
computer and the Internet has also skyrocketed in recent years. A general price
decline for computer and communication tools has been ongoing as well, helping to
promote online-type transactions at the supply side.
Moreover, it seems that the spread of mobile telecommunications has contributed to
the development of digital cash. In the near future, interactive television will be used to
make transactions. IT (information technology) has undergone a global revolution in
many fields. Ubiquitous instruments in IT fields have appeared recently allowing for
digital cash to develop much further.
There are two points that will be emphasized in this chapter. The first point is that given
the essential characteristics of electronic money, its...