Japan FinTech Observer #123

Welcome to the one hundred twenty-third edition of the Japan FinTech Observer.

Earnings season is in full swing, and there were plenty of announcements last week, so we would just like to draw your attention to the Japan Fair Trade Commission's guidelines for smartphone apps - coming into effect December 18, 2025, the rules will allow for payments to be made outside of the technology giants' app stores, and several payment service providers are gearing up for providing such services at a much lower price point. The documentation is available in English (provisional translation) and well worth a read.

Here is what we are going to cover this week:

• Venture Capital & Private Markets: JAPAN AI has raised a total of 1.9 billion yen in Series B funding with participation from JAFCO, Nissay Capital, FCE, and Resona Capital; Japan Post Insurance invests USD 2bn in Global Atlantic vehicle; SMBC Group is discussing with investors a significant risk transfer connected to a portfolio of loans made to private market funds
• Insurance: Resolution Life has entered into a reinsurance agreement with Taiju Life Insurance, a domestic insurer and part of the Nippon Life group; NTT Data Corporation has concluded a sales agent agreement with Lazarus AI, participant in Plug and Play Japan's Summer 2025 InsurTech Batch
• Banking: SMBC Group and Mizuho have published their first quarter earnings; Mizuho Bank to acquire 70% of Upsider Holdings for JPY 46bn, and 100% of the equity shares in advisory firm Augusta & Co; Mizuho & Softbank forge an AI alliance, MUFG is first to implement Salesforce's "Agentforce"; Hokkoku Bank will license out its newly custom-built core banking system
• Payments: the Japan Fair Trade Commission has released guidelines for information technology giants regarding smartphone apps; Tokyo Metro has announced the launch of a post-payment boarding service using touch payment methods; Infcurion has announced that its group company Link Processing's devices will be installed in 70,000 taxis nationwide; JAL launches top-of-the-range metal card, the "JAL Luxury Card"; Coupa and Sumitomo Mitsui Card launch B2B virtual cards in Japan; Aplus launches card for foreigners
• Capital Markets: Nomura published first quarter results
• Asset Management: SBI Sumishin Net Bank and FOLIO will develop new asset management services for SBI Sumishin Net Bank customers; AXA Investment Managers Alts has marked its entry into Japan’s retail real estate market
• Digital Assets: The Osaka Exchange plans to consider listing cryptocurrency-related futures and options; Metaplanet filed to issue up to $3.7 billion in new perpetual preferred shares; Tokyo Stock Exchange-listed Quantum Solutions has entered into a business collaboration arrangement with TDX Strategies for its Bitcoin treasury; Pivotal Trend Service is set to launch the first round of sales for its Bitcoin mining token; Aplus adds cryptocurrency to its credit card point exchange rewards
• The Last Word: Reading the green tea leaves

Venture Capital & Private Markets

• JAPAN AI has raised a total of 1.9 billion yen in Series B funding with participation from JAFCO Group, Nissay Capital, FCE, and Resona Capital; the raised funds will be utilized to strengthen talent acquisition, expand AI agent capabilities and enhance quality, and strengthen AI integration with marketing SaaS, aiming for further evolution of products supporting corporate DX and AX (AI Transformation) and market expansion
• Japan Post Insurance Invests USD 2bn in Global Atlantic Vehicle: Japan Post Insurance, KKR, and Global Atlantic, a leading provider of retirement security and investment solutions, and a wholly-owned subsidiary of KKR, have entered into definitive agreements under which Japan Post Insurance will invest $2 billion (approx. JPY 300 billion) in a new vehicle sponsored by Global Atlantic; Japan Post Insurance’s commitment is over 50% of the Vehicle, which is expected to have access to Global Atlantic’s insurance, reinsurance and strategic activity, and to commence operations in the first half of 2026, subject to customary regulatory approvals
• SMBC Group is discussing with investors a significant risk transfer (SRT) connected to a portfolio of loans made to private market funds, according to Bloomberg; the Japanese bank is exploring an SRT linked to approximately $8 billion of subscription lines, which are credit facilities typically provided to private equity and other private market funds to help manage their liquidity needs; the SRT transaction itself would be valued at around $1 billion, representing 12.5% of the total loan portfolio
• In an insightful episode of MUFG’s “Venture Visionaries,” host Priya Rajan speaks with Navneet Govil, Executive Managing Partner and CFO of SoftBank Vision Fund, to explore the inner workings of one of the world’s largest technology investment funds; the conversation provides a comprehensive overview of SoftBank’s history, its current investment philosophy, and its ambitious strategy for the future, particularly in the realm of artificial intelligence

Insurance

• MSIG Asia and Serenity Health Partners' partnership, announced in September 2024, is off to a promising start, extending beyond Singapore to Vietnam and Indonesia, with additional expansion under review; here is the original announcement
• Resolution Life, a life insurance group focused on reinsurance and managing life insurance portfolios, has entered into a reinsurance agreement with Taiju Life Insurance, a domestic insurer and part of the Nippon Life group; the agreement aims to increase the crediting rate of Taiju Life’s Australian dollar-denominated endowment product, which is distributed through its tied-agent channel, by utilising Resolution Life’s experience with different product types and distribution channels; this is Resolution Life’s second flow reinsurance deal in Japan and its third in Asia in 2025
• NTT Data Corporation has concluded a sales agent agreement with Lazarus AI, which provides multimodal LLM products available in closed network environments, particularly to the life insurance industry, and property insurance industry, and is also a participant in Plug and Play Japan's Summer 2025 InsurTech Batch; starting in August 2025, NTT Data will begin providing "Lazarus AI" and construction/implementation support services to the Japanese market; by combining NTT Data's GPU infrastructure with "Lazarus AI," customers will be able to handle critical information with generative AI without connecting to the internet
• In an interview at ITC Asia, Tomoo Yano, General Manager at Nippon Life Insurance Company, shares his views on how technology is redefining the role of insurers, the importance of adapting to the expectations of the next generation of customers, and the evolving balance between human expertise and automation

Banking

• Sumitomo Mitsui Financial Group (SMFG) has commenced the fiscal year ending March 2026 with a robust first-quarter performance, characterized by strong underlying fundamentals in its core domestic operations; the group reported a Profit Attributable to Owners of Parent of ¥376.9 billion, a modest increase of 1.5% year-over-year (YoY), and a more substantial 16.1% YoY surge in Consolidated Net Business Profit to ¥544.3 billion
• Mizuho Financial Group has delivered a nuanced set of results for the first quarter of fiscal year 2025 (ending June 30, 2025), characterized by a stark divergence between its core business segments and a surprisingly bullish revision to its full-year guidance; while Profit Attributable to Owners of Parent posted a marginal year-over-year (YoY) increase of 0.4% to JPY 290.5 billion, this figure was flattered by non-recurring items; a more telling metric, Consolidated Net Business Profits—a proxy for core operational earnings—declined by 3.7% YoY to JPY 316.4 billion, reflecting significant headwinds in the group's market-facing activities and the adverse impact of a strengthening yen
• Mizuho Bank to acquire 70% of Upsider Holdings for JPY 46bn: Mizuho Bank has concluded a share transfer agreement with the shareholders of Upsider Holdings to acquire a majority of Upsider’s shares; Mizuho Bank will acquire approximately 70% of Upsider’s shares at a price of approximately ¥46 billion from their current holders, which include venture capital firms in and outside Japan, and Upsider will become a consolidated subsidiary of Mizuho Bank; Upsider’s founding shareholders will retain their shares; with a view towards publicly listing the company in the future, they will accelerate creation of new value through quick startup-style management and utilization of Mizuho Financial Group resources; subject to regulatory approval, the share transfer will be complete around September 2025
• Mizuho to acquire leading independent European financial advisory firm in the renewable energy and energy transition sector, Augusta & Co; Mizuho will acquire 100% of the equity shares in Augusta & Co, including employees of the advisory business; the Augusta & Co. brand will be maintained, and the existing leadership will remain in place; Augusta & Co’s Asset Management business is not part of the transaction
• Mizuho Financial Group and SoftBank have entered into a strategic understanding to explore advanced AI capabilities in the age of AGI; as part of this initiative, Mizuho will be the first in the financial industry to implement Cristal Intelligence, an enterprise AI co-developed by SoftBank and OpenAI
• Salesforce Japan announced that The Bank of Tokyo-Mitsubishi UFJ has selected the autonomous AI agent "Agentforce for Financial Services" specialized for the financial industry; this case represents Japan's first implementation of Agentforce for Financial Services
• GMO Aozora Net Bank and the University of Tokyo Graduate School of Engineering Morikawa-Narisue Laboratory have officially launched joint research towards the construction of innovative credit risk assessment models utilizing AI and machine learning; in other news, TRABOX has launched a new service called "Finto Invoice Payment", which significantly reduces the burden of accounting operations for corporate clients by using "BaaS by GMO Aozora" provided by GMO Aozora Net Bank to complete the entire process from invoice receipt to payment in a one-stop solution
• CC Innovation, a group company of Hokkoku Financial Holdings, has decided to license the next-generation core banking system currently being developed for Hokukoku Bank from January 2028, as well as various subsystems developed and utilized in-house, to regional financial institutions outside the group; CC Innovation will also begin providing migration support consulting services from existing systems

Payments

• The Japan Fair Trade Commission has released guidelines for information technology giants regarding smartphone apps, ahead of the full implementation in December of a new law to promote competition in the app market; the guidelines prohibit the companies from using data obtained through their operating systems to develop products with competitive advantages and hampering the use of other companies' payment systems in apps; they are also urged to allow customers to choose from among multiple search engines when buying new devices
• Tokyo Metro has announced the launch of a post-payment boarding service using touch payment methods with compatible cards (including credit, debit, and prepaid cards) and smartphones with such cards configured, on all Tokyo Metro lines starting in spring 2026; Tokyo Metro has been operating a "boarding service utilizing credit card touch payment and QR codes" since March 22, 2025, targeting special tickets purchased in advance through the Tokyo Metro sales website; this initiative will now be expanded to launch a post-payment boarding service using touch payment; starting in spring 2026, customers will be able to use all Tokyo Metro lines by simply holding their touch payment-compatible cards over the reader at automatic ticket gates and passing through without purchasing tickets in advance
• Infcurion has announced that its group company Link Processing has begun full-scale implementation of the cashless payment solution "Anywhere D135" on rear seat tablets deployed by GO Corporation, which provides the taxi app "GO"; the rear seat tablets will undergo full-scale implementation from this summer and are scheduled to be installed in over 70,000 vehicles nationwide
• JAL Launches Top-of-the-Range Metal Card, the "JAL Luxury Card": Luxury Card, APLUS, and Japan Airlines have begun accepting applications for the "JAL Luxury Card" and "JAL Luxury Card Limited" (invitation-only); these cards offer an unprecedented, high-quality experience for customers seeking the highest value; these cards combine high status and sophisticated services, delivering a luxurious experience in both everyday life and travel; APLUS will be responsible for issuing the cards
• Aplus Launches Card for Foreigners: G-FACTORY and Aplusa member of the SBI Shinsei Bank Group, have launched the "GF Card," a partnership credit card exclusively for foreign workers
• Coupa and Sumitomo Mitsui Card Launch B2B Virtual Cards in Japan: Coupa announces its partnership with Sumitomo Mitsui Card Company (SMCC) at Coupa Inspire Japan, marking a significant development for Japanese fintech

Capital Markets

• Nomura Reports First Quarter Financial Results: all business divisions booked stronger net revenue and pretax income QoQ; Group net income increased QoQ to Y104.6bn; Wealth Management had 13th consecutive quarter of net inflows into recurring revenue assets; Investment Management AuM of Y94.3trn at all-time high underpinned by ninth straight quarter of net inflows; Global Markets net revenue stronger QoQ while Investment Banking net revenue was at highest level for Q1 since FY2016/17 when comparisons possible; Banking booked solid revenues from lending and trust and agent operations; earnings per share of Y34.04, up 46% QoQ and 52% YoY; first quarter ROE of 12.0%

Asset Management

• SBI Sumishin Net Bank and FOLIO, a subsidiary of FOLIO Holding that provides innovative financial solutions within the SBI Group, have concluded a "Basic Business Partnership Agreement" for the purpose of jointly developing new asset management services for SBI Sumishin Net Bank customers; the launch of the new joint services is scheduled for around autumn 2026
• AXA Investment Managers Alts has marked its entry into Japan’s retail real estate market with the acquisition of a 2,400sqm asset in central Tokyo

Digital Assets

• The Osaka Exchange plans to consider listing cryptocurrency-related futures and options, President Ryusuke Yokoyama revealed in an interview with Bloomberg
• Tokyo-listed bitcoin treasury firm Metaplanet filed to issue up to $3.7 billion in new perpetual preferred shares by 2027 to fund its aggressive BTC accumulation plan
• Tokyo Stock Exchange-listed Quantum Solutions has entered into a business collaboration arrangement with TDX Strategies to cooperate extensively in areas including Bitcoin trade execution, asset custody, structured product design, and market risk management—offering end-to-end technical and service support for Quantum Solutions' Bitcoin Treasury strategy
• This month, Pivotal Trend Service (PTS), a Japanese company with over a decade of experience in telecom infrastructure, is set to launch the first round of sales for its Bitcoin mining token, “PMN (Pivotal Mining Note),” structured in full compliance with U.S. securities regulations; unlike conventional cloud mining schemes, PMN features a 36-month fixed-term contract and a fully regulated design
• Slash Fintech Limited's "Slash Payment" now supports Kaia, the Layer 1 blockchain developed by Kaia Labs & Kaia Foundation; looking ahead, Slash Payment intends to launch Slash V-Preca SHOP on Kaia, with the goal of fostering the development of the Kaia ecosystem within the Japanese market; in addition, Slash Payment is jointly working with Kaia to expand services via Mini Dapps within the LINE messenger, offered by Kaia in collaboration with LINE NEXT
• Aplus Adds Cryptocurrency to Point Exchange Rewards: Aplus, a member of the SBI Shinsei Bank Group, and SBI VC Trade, a consolidated subsidiary of SBI Holdings engaged in the cryptocurrency exchange business, have collaborated to add Bitcoin (BTC), Ethereum (ETH), and XRP handled by SBI VC Trade as exchange rewards for the point service (Aplus Points) of credit cards issued by Aplus; this marks the first time cryptocurrency has appeared as an Aplus Point exchange reward
• Just like for this fiscal year, the Japan Cryptoasset Business Association (JCBA), jointly with the Japan Virtual and Crypto assets Exchange Association (JVCEA), has compiled a tax reform request for cryptoassets for FY2026 and submitted it to the government

The Last Word: Reading the green tea leaves

The smart people at Mitsubishi UFJ Morgan Stanley are well-versed in reading the green tea leaves left by the Bank of Japan's Monetary Policy Meeting, so one cannot go wrong by sharing the essence of their assessment:

• BoJ leaves policy rate on hold at 0.5%, but latest Outlook Report is less dovish
• "Extremely high uncertainties" have become "high uncertainties," suggesting Bank may view trade agreement as having eliminated some uncertainty
• BoJ raises its inflation projections and upgrades assessment of inflation risks to "generally balanced," suggesting it may have begun preparing for resumption of rate hikes

Mitsubishi UFJ Morgan Stanley previously expected the next rate hike would come at the January 2026 MPM, but they now see a possibility of the Bank moving sooner than that.

If you are further interested in the art & science of interpreting the Bank of Japan's proclamations, Mitsubishi UFJ Morgan Stanley provided the following evolution of the BOJ's comments on monetary policy for the 2025 "Outlook Reports":

Please follow us to read more about Finance & FinTech in Japan, like hundreds of readers do every day. Our short weekly digest, the “Japan FinTech Observer”, is published on LinkedIn, on Medium & Substack, or here on our own FinTech Observer website. Only the latter provides you with the option to subscribe to individual news stories as they are published.

Should you wish to further discuss the Japanese (or Asian) FinTech ecosystem, you may book a consultation via Intro - all proceeds flow towards covering the operating cost of the Tokyo FinTech Association, and research for the Japan FinTech Observer.