This is Japanese-style BGM played by Koto, Shakuhachi, and Shamisen. It has a heartwarming, everyday atmosphere, as if strolling through a hot spring resort.
Although the atmosphere is mellow at first, the shamisen becomes the main melody in the middle of the song, creating a lighthearted atmosphere and showing the fun side of a hot spring resort town.
Recommended for Japanese RPGs, programs introducing Japan, and background music related to hot springs, inns, and ryotei (traditional Japanese restaurants).