municipalities The workload of "paper gift certificates" that the person in charge is chasing. What is the urgency of the "digital shift" for FY Reiwa 8?

The "gift certificate with premium" project is planned to be continued and strengthened as an economic measure by the government. Behind the glamorous purpose of revitalizing the local economy, municipalities staff and chamber personnel in the field seem to be busy with the enormous workload and risk management of paper-based analog operations.

"I want to improve the efficiency of operations" and "I want to go digital next time..."—why should we start considering it "now" as the number of people in charge feels that way?

We asked Sho Hamada, who has been at the forefront of the gift certificate and regional currency business at GMO Payment Gateway (hereinafter referred to as GMO-PG) and has helped many municipalities and chambers of commerce solve their problems, about the real reality of the field and the secret to successful digitalization.

Screams from the field: The operation of "paper" has reached its limit

――Mr. Hamada is in dialogue with municipalities and chambers of commerce and industry nationwide every day, but what kind of challenges are being raised in the field regarding the "paper gift certificate business"?

Hamada:

The challenges faced by people in the field are more serious than imagined, and they have reached the limits of handling physical "things".

Specifically, it can be summarized in three points: "risk of preparation and management","large workload", and"inconvenience as a resident service".

First of all, regarding the "risk of preparation and management", when issuing paper gift certificates, gold certificates in units of hundreds of millions of yen must be printed, stored strictly, and transported to each sales office. This is not just paper, but "money" itself, so it is nerve-boggling to take measures against the risk of loss and theft. In addition, the cost of embossing and special printing to prevent counterfeiting is not ridiculous.

GMO-PG Sho Hamada

――The pressure to manage hundreds of millions of yen in kind is considerable.

Hamada:

Let's see. And the "large amount of work" that sells them catches up.

To sell paper gift certificates, you need to set up a special sales office and have a salesperson.

Previously, I also supported the operation of the digitalization consultation meeting at the sales office. What I saw at the scene was that it was not uncommon for residents to form long lines from 5 a.m. The on-site staff are busy managing and selling paper gift certificates while organizing the queue.

In addition, the burden on the merchant on the side of the gift certificate cannot be overlooked.

Used gift certificates must be kept in stores and regularly brought to the cash office. The work of manually counting each piece and matching the amount puts pressure on the original work time. There are not a few local stores who say they don't want to participate because it's hard to exchange cash.​

――What do you think from the perspective of residents (users)?

Hamada:

The "inconvenience" of analog is causing lost opportunities.

In the operation of paper gift certificates, sales offices are often set up at city halls and chambers of commerce, and these are often only open on weekdays. As a result, the working generation who work on weekdays cannot buy it, and residents may complain that they can't buy it even if they want to.

In addition, since the ticket type is fixed in "1,000 yen units", some say that it is difficult to use because you do not get change for shopping for a few hundred yen.

"Buying and adjusting things you don't need to spend 1,000 yen" cannot be said to be an essential stimulus for consumption.Compared to digital (cashless), which can be payment in units of 1 yen, the difference in convenience is obvious.

Why "now"? What are the economic reasons to turn to digitalization?

――Looking at the recent news, the government's economic measures and subsidy flows are clearly oriented towards "digitalization (DX)". As we look ahead to the next fiscal year (Reiwa 8), why do we need to turn to digitalization "now"?

Hamada:

The biggest reason is that the trend of national subsidies and grants is shifting towards digital preferential treatment.

In most cases, when municipalities conducts gift certificate business, they use national grants (such as grants for priority support regions) as financial resources, but there are cases where "digitalization" is an additional factor in this subsidy amount.

To give a specific example, in one municipalities of the public recruitment guidelines, the upper limit of the subsidy for issuing paper gift certificates was 14 million yen, but when the digital method was adopted, the subsidy was increased to 18 million yen.

This difference of 4 million yen is very large. With this budget, it is possible to invest in measures to increase the probability of success of the business, such as more effective publicity promotions (flyers and poster production), increasing the return rate to users, and setting up a call center to support the elderly.

――Even if you do the same business, there is a possibility that the budget that can be used will increase just by digitizing.

Hamada:

The trend of promoting DX as a whole will accelerate further in the future and will not stop. Considering the current situation where there is such a difference in subsidy amounts, it can be said that the most sensible budgeting strategy for municipalities is to switch to digital as soon as possible and build a smooth operation system with a generous budget.

You also need to move "now" from a scheduling perspective.

For example, if you want to start a new business, you need to start at least 3-4 months in advance. As we are increasingly consulting on the collection of specific information and specification formulation for the next fiscal year's budget​, we hope that you will start considering it as soon as possible, referring to the case of "Mobile Gift Certificate Platform byGMO" where GMO-PG provides payment systems.

Is it true that "the elderly cannot use it"? Surprising realities and analog support shown by data

――The biggest obstacle to considering digitalization is the concern that the elderly will not be able to use it (digital divide). What is the reaction in the field in this regard?

Hamada:

As you said, there is almost always a voice of anxiety about dealing with the elderly from any municipalities person in charge.

However, if you look at the data of municipalities that have actually been introduced, the anxiety is often that it is easier to have a child than to think.

For example, in the case of a shopping street that introduced digital gift certificates, when we analyzed the age of users on the dashboard, users in their 60s and older accounted for about 22% of the total. This is almost the same level as those in their 50s (about 25%), and data proves that the elderly are also using digital gift certificates.

There are also good examples, such as YORO town in Gifu Prefecture, which is being used as a regional currency beyond the framework of digital gift certificates. The cumulative total circulation amount as Yoro Pay has exceeded 500 million yen, and the number of registered users has expanded to more than 17,000*. With a large number of registered users over the age of 70, it can be said that it is truly a "regional finance infrastructure" Actual that is permeating both men and women of all ages.In addition, there is a system that allows you to use digital gift certificates even if you do not have a smartphone, so it is used by people in various environments.

*The total circulation amount and the number of registered users are cumulative from FY2021~FY2024

――So a wide range of generations, including the elderly, are actively using digital gift certificates.

Hamada:

Of course, it will not spread by simply introducing a system and saying, "Please do the rest yourself." We believe that the key to successful digitalization lies in "polite analog support", paradoxically.

At "Mobile Gift Certificate Platform byGMO", we provide generous support according to the situation of each municipalities. For example, the following measures are included:

1. Conduct face-to-face briefings:
   We will rent a place where residents can easily gather and a corner of a member store that is frequently used to hold special booths and briefing sessions. So, we will give you a face-to-face and polite lecture, from downloading the app to registering and actually payment methods. The peace of mind of face-to-face is important for people of all ages.
2. Dedicated Call Center Installation:
   In case you are unsure about the operation, we will prepare a telephone counter. It is important to prepare not only consumer but also line for merchants.
   For store owners who protect local stores, the transition from paper to digital is a major change. By having a system that can immediately respond to voices such as "I don't know how to use the management screen" or "I'm worried about whether I have a payment", the digitalization of the store side will proceed smoothly.

It is precisely because of this "accompanying support" that even people who are unfamiliar with digital technology can participate with peace of mind, which leads to a high usage rate.

――What do you think about the "hybrid operation" of paper and digital?

Hamada:

There are also a certain number of municipalities who use paper gift certificates and digital gift certificates together. We aim to create a form that can be used by anyone.

However, to be honest, it seems that the people in charge of operations in the field have a strong desire to move towards "digital unification". This is because if you continue to operate in parallel, the preparation cost and management cost will be doubled, and the benefits of improving operational efficiency will be diminished.

Even if you are worried at first, if you use it in conjunction with a digital gift certificate and feel that it is surprisingly usable and convenient, you can increase the digital ratio at once after the second year. We believe that it is also an important role for us to draw a roadmap for such a "step-by-step full digitalization" together.

Why choose "Mobile Gift Certificate Platform byGMO" over major Pay payment?

――What are the advantages of choosing "Mobile Gift Certificate Platform byGMO" over other companies' payment apps and systems?

Hamada:

The biggest difference is that it can establish an "economic cycle within the region (community-based)".

Pay-based payment that are expanding nationwide can also provide similar services. In this case, if the area of use cannot be limited, the economic cycle in the city will not be possible and the effect will flow out of the area.

However, Mobile Gift Certificate Platform byGMO onlybuilds "a infrastructure of payments according to the region". By building a network of merchants and merchants with municipalities and chambers of commerce taking the lead, we can design a system that allows money to fall not only to major chain stores but also to local shopping streets and individual stores. Isn't this the original form of "regional revitalization"?

―― For municipalities, "data visualization" is also a big weapon.

Hamada:

You are right. In paper operations, it was impossible to see "who", "where", and "how much" were spent, but in digital, all of these are visualized.

You can grasp data such as "which area of restaurants are busy" and "which age group is most used" in real time on the dashboard.

In addition, the data that can be obtained includes "name, phone number, address (zip code), gender, age", etc. These data will be very strong evidence for policy planning in the next fiscal year and in Actual reporting to the government (EBPM: evidence-based policy making, the idea of explaining the effectiveness of measures based on data).

―― Since it is a business that deals with public fund, I am also concerned about security.

Hamada:

Reliable safety is an essential factor. As a payment processing company company (PSP) that underpins Japan's finance infrastructure, we provide services with financial institution level of security standards.

In addition to 3D Secure at Credit card payment when purchasing digital gift certificates, it is equipped with robust security measures such as SMS authentication (anti-spoofing) and setting a payment passcode (6 digits).

We are proud that the reliability of saying "Mobile Gift Certificate Platform byGMO is safe" is one of the reasons why many municipalities choose it.

The key to success is "backward thinking". What is the support provided by GMO-PG to sweat together?

――Finally, are there any common points in the municipalities that succeed in actually proceeding with the project?

Hamada:

This is all about whether or not you are preparing with "backward thinking".

If you just introduce a system, your gift certificate business will not be successful. It is necessary to set a goal of "when do you want to start using it", and then work backwards from there to carefully plan a schedule such as "when do you have to recruit franchisees" and "when should you start announcing to residents (flyers and posters)".

For example, even if you start recruiting merchants just before the start of use, the store will not be able to consider and prepare in time. If you don't have attractive stores, residents don't want to buy or use gift certificates.

It is also important to have a strategy to develop franchise stores from the perspective of residents, such as whether there are stores that can be used on a daily basis, such as supermarkets and drugstores.

We not only provide the system, but also work hard with municipalities from these" business plan planning" and "promotion strategy"parts.

GMO-PG's strength is that it can provide one-stop support for all operations related to operations, from creating flyers to arranging call centers and creating manuals for merchants.

――I heard that once it is introduced, it is often used continuously.

Hamada:

Thankfully, the repeat rate is very high.

The reason is simple: once you get used to it, you will municipalities the convenience that cannot be returned to paper.

In addition, since the second year and beyond can be carried over as it is to the previous year's merchant and user data, there is no need for various registration work and screening, and the burden of preparation is dramatically reduced.

If you are worried about the operation of paper, or if you are worried about budgeting and business plan for the next fiscal year (Reiwa FY8), please contact us. We will do our best to dispel the image that "digital seems difficult" and propose the best plan to advance the local economy to the next stage.