However, the expansion is unlikely to be achieved if FinTech firms and banks act separately in pursuing their own cashless payment services. In such a situation, a desirable option is that payment service providers collaborate with each other – that is, make their services interoperable – in order to maximize the network effects of digital yen.
Collaboration among payment service providers can take various forms: between banks, between FinTech firms, and between banks and FinTech firms. At first glance, interoperability may seem like giving away the benefit to the other parties. That would be true if the market for cashless payment services does not scale up even with the introduction of interoperability.