Japanese banks, long content to foster the nation's love for cash, are now diving into digital payments thanks to a regulatory change that threatens to usher in new rivals.

In recent months, lenders around the country have announced a flurry of initiatives designed to grab a slice of the $50 billion (¥5.35 trillion) market for electronic settlements. Projects are under way to develop platforms using everything from QR codes to blockchain technology and digital currencies.

The catalyst: a law change being phased in over the next two years that will make it easier for depositors to give third parties access to their accounts and data. Part of a government effort to reduce Japan's high cash use, the amendment could spur competition from financial-technology giants such as Ant Financial and Apple Inc., as well as startups like Ripple Labs Inc. and Origami Inc.