Japan DX: The State of Digital Transformation in Japan

In recent years, the term DX has been popping up in Japan. 

DX, which stands for digital transformation, is Japan’s push to modernize the government, various industries, and daily life.

Here, we explore Japan’s efforts towards digital transformation, current government policies, challenges, and how businesses contribute to the shift. 

What does DX mean in Japan?

DX, or Japan digital transformation, refers to a strategic switch to a more digital route to bring enhanced changes to people’s lives.

Known for its bureaucratic paperwork, Japanese government entities and companies are working towards a more streamlined, digital-first approach. 

One of the major goals of Japan DX is to modernize any outdated systems and reduce manual processes.

Why DX matters for Japan

Japan’s Ministry of Economy, Trade and Industry published a 2025 Digital Cliff report, citing a need for a digital transformation push. 

It also highlights Japan’s ongoing societal issues, such as aging demographics and the shrinking workforce, with economic risks if DX is not considered. 

In response, the Japanese government has launched and promoted different digital reforms, including Japan’s Digital Agency and the My Number cards. In addition, the government is also issuing grants to businesses that are making digitalization efforts.

Government policies in Japan with DX

Here are some of the Japanese government's digitalization efforts you may have seen if you are living in Japan:

a) MyNumber

Japan’s MyNumber card

The MyNumber Card (マイナンバー, Mai Namba) or the Individual Number Card system is one of the most prominent examples of digital transformation in Japan.

With a MyNumber card, you can:

• Streamline healthcare by showing your My Number Card at hospitals and pharmacies for quicker data processing, as well as being able to access your medical history through the MyNaportal.

• Receiving certificates without going to the ward office, such as your juminhyo (residence record) at Japanese convenience stores.

• Combine it with your driver’s licence so that you don’t have to carry multiple IDs. Additionally, you will get a lower renewal fee, and online renewal will be available to you.

b) Cashless payment apps in Japan

One of the many cashless payment options: payment via QR code.

Japan has many different payment methods, which include cashless payment methods that can be used for multiple purposes.

• Transportation cards, such as Suica and PASMO, are used for trains and buses. You can even use the app version for more convenience. 

• Credit cards and electronic cash cards are linked to your bank or point card account.

• Smartphone payment options through your phone that link various payment options through your phone, such as Apple Pay, credit cards, and IC cards.

• Contactless payments are where you tap your card or scan a QR code with your phone. 

With these cashless payments, you won’t have to bring a bulky wallet ever again.

c) METI’s DX efforts

Japan’s Digital Agency website

Japan’s Ministry of Economy, Trade and Industry has launched numerous efforts to help with domestic digital transformation. 

• DX Certification System (DX認定制度): This encourages companies to disclose their DX strategies and receive certification if they meet key criteria. It's a public signal of the company’s digital readiness.

• Digital Agency (デジタル庁): This agency is leading efforts to modernize public sector IT systems and streamline citizen services. Their efforts include the MyNumber ID and digital driver's licenses.

• Subsidies for SMEs: The government is providing financial and advisory support for small-to-medium enterprises struggling with digital change efforts.

Is Japan technologically advanced? Challenges to DX in Japan

Despite these efforts, there is still a gap between these policies and real-life practices.

In the Global Digital Competitiveness 2024 Ranking, Japan was only ranked 21st. Japan still has a long way to go compared to other countries’ digital advances and preparedness. 

That can be seen in Japan’s real-life practices, such as inkans and hanko (personal seals) for getting a bank account, and the continued use of fax machines despite these digital efforts. In these situations, there is a slow transition, which is largely rooted in Japanese traditional work culture that is resistant to change.

Another digitalization challenge Japan faces is the lack of skilled DX talent. Japan needs experts in current emerging fields such as AI, IoT, cloud computing, cybersecurity, and data science, to make an effective digital transformation.

The talent shortage is further seen in Japan's traditional corporate structures that rely on outsourcing for IT and development tasks. 

Overcoming these barriers will be crucial for Japan to stay globally competitive in the digital age.

Examples of DX in Japan

Many startups and companies are leading Japan DX efforts. Here are some examples:

a) Freee

Freee Japanese home page

Freee is a Tokyo-based SaaS provider that offers cloud accounting, HR, and finance management tools for small and medium businesses.

Because of their business model, it’s natural for DX efforts to be part of their services. 

As such, it includes:

• SME Empowerment: by offering local ICT consulting to drive SME digital adoption.

• Document automation: by using AI-OCR integration for automated invoice entry via API.

• Have a developer DX team.

• Compliance & workflow digitalization: for paperless project invoicing and e-record compliance.

b) AirVisa 

AirVisa is a Tokyo-based startup that streamlines visa administration processes for foreign workers in Japan, helping companies stay compliant through their cloud-based platform.

With the nature of their work, their DX efforts include:

• Cloud-based visa management: to streamline the visa process for companies and foreign workers.

• AIRVISA Reader app: that uses NFC and OCR to read residence cards and reduce manual data entry.

• Online applications: to enable digital visa renewals and filings.

For any businesses wanting to simplify the visa-related paperwork and reduce in-person immigration visits, AirVisa is a seamless digital solution.

c) Tonichi Printing

While being a traditional newspaper, Tonichi Printing has expanded into the IT sector with T-NEXT.

Through this digital expansion, they have developed:

• NEXTa Meishi: A B2B business card management app that uses cloud-based OCR and AI to digitize and organize business cards.

• NEXTa Scheduler: A business scheduling tool that allows users to coordinate meetings, reserve conference rooms, send notifications, and track attendance.

• Web & app development services: where they design, build, and operate various websites and applications for corporations, Membership-based platforms, and e-commerce stores.

Their digitalization efforts are helping businesses become more digitally organized and efficient.

d) Timee

Timee is an on-demand gig-work platform that connects individuals seeking flexible work with businesses that need staffing. 

Their digitalization efforts allow employers and employees to better match with each other. It includes: 

• Real-time matching platform by using an algorithm to match job seekers with employers based on time availability and skill requirements.

• Instant payment system: where gig workers are compensated after their job is completed, with real-time transaction support.

• Automated resume generation & ratings: The system can automatically generate worker profiles and resumes.

e) Tablecheck 

Tablecheck home page

Tablecheck is an online reservation business that recognizes the importance of DX efforts.

After Covid-19, the overall food and drink industry is moving towards a digital transformation. The Hot Pepper Gourmet Dining Out Research Institute found that 62.3% of restaurant managers have introduced one or more digital tools, which include cashless payment.

It can be easily seen in most restaurants through:

• Online reservation systems.

• Take-out and delivery services.

• Providing an app to easily order, create an account, and view one’s order history.

TableCheck is one of the few companies helping other businesses to be more digitally advanced, particularly in the food industry. 

f) Dinii 

Dinii is another company driving Japan’s DX restaurant efforts by digitizing the experience, from ordering and payment to customer engagement and back-office automation.

Their Japan transformation DX efforts include:

• All-in-one restaurant cloud platform: by combining restaurant operations—POS, mobile ordering, CRM, HR tools, and payments.

• Mobile ordering with intuitive mobile/tablet interfaces.

• Fintech integration to help with cash flow and sales.

Dinii is constantly adapting to current digital trends and can help other businesses adopt as well. 

g) Remody

Remody is a Tokyo-based startup that builds software that automates and streamlines complex workflows in financial institutions.

Their mission is to promote digital transformation and enhance transparency and accessibility across the financial industry.

h) Nippon Shinyaku

Nippon Shinyaku is a Japanese pharmaceutical company.

According to their website, they are working towards obtaining the DX Certification. Their DX efforts include:

• Providing DX-oriented HR training programs.

• Promoting IT literacy for all employees.

• Using digital solutions that include AI-enabled voice-to-text conversion to help with consultation services.

What DX in Japan means for tech people

Japan needs more digital-savvy engineers and DX consultants, even if they don’t realize it yet.

More modern, Western-style companies are increasing their global hiring and adopting more flexible work styles, such as being remote-friendly.

As such, more DX-friendly companies are offering work opportunities, particularly in software development and engineering. 

If you’re a tech professional interested in working in Japan, Japan-Dev makes it easy to find these DX-friendly companies building innovative products and offering supportive, international team cultures.

Whether you want to relocate or work remotely, DX in Japan is opening doors for tech professionals worldwide.

In closing

Japan’s digital transformation (DX) is more than a tech trend. It is a nationwide shift to how governments and businesses operate and how people work and live.

While there are still challenges, the DX momentum is growing thanks to government policy, innovative startups, and forward-thinking companies.

Japan DX represents a unique situation for global tech talent. If you're looking to build impactful products and be part of something transformative, there's never been a better time to join Japan’s digital future.