Japan FinTech Observer #126

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

Quite the week in Japan, with the 9th Tokyo International Conference on African Development (TICAD9), as well as the kick-off to Japan Blockchain Week with the WebX Fintech EXPO in Osaka. The former was dominated by SMBC making a slate of partnership announcements on the continent, the latter by SBI Holdings making a series of coordinated announcements SBI to unveil a multi-faceted strategy to build and dominate the next generation of digital finance.

Here is what we are going to cover this week:

• Venture Capital & Private Markets: Shoko Chukin Bank provides JPY 100m in debt financing to COUNTERWORKS; MUFG Innovation Partners participate in Relcu's funding round; SBI leads DigiFT's strategic round to scale institutional-grade RWA infrastructure; AND Global secures USD 21.4m Series B led by IFC and AEON Financial Service; Uncovered Fund & Monex Ventures launch USD 20m Africa Fund; SMBC has made an investment in the Novastar Ventures Africa People and Planet Fund III
• Banking: Seven Bank commences capital & business alliance discussions with ITOCHU Corporation; SBI resumes regional bank partnerships, to acquire up to 3% of Tohoku Bank; SMBC unveils a comprehensive strategy for Africa's future at TICAD9; SMBC has secured approval from the Reserve Bank of India to acquire up to 24.99% of YES BANK; Finastra completes the first-ever Loan IQ deployment in Japan
• Payments: SBI revealed a comprehensive, three-part strategy to ensure the availability and circulation of best-in-class stablecoins in Japan: partnerships with Circle, Ripple, and SMBC; Simplex and Ava Labs conduct joint verification of next-generation remittance and settlement network
• Capital Markets: the future of Crypto ETFs in Japan
• Digital Assets: SBI Holdings has announced a strategic joint venture with Startale Group to develop and launch a comprehensive on-chain trading platform focused on tokenized stocks and real-world assets (RWAs); connecting the vision for tokenized assets with the stablecoin strategy is "Project Trinity," a major proof-of-concept initiative to modernize Japan's security token market: an impressive consortium of eight leading financial and technology firms—including SMBC, Daiwa Securities, SBI Securities, Osaka Digital Exchange (ODX), SBI R3 Japan, BOOSTRY, Progmat, and Datachain—has officially launched the project
• The Last Word: Techstars Tokyo 2025

Venture Capital & Private Markets

• Shoko Chukin Bank provides JPY 100m in debt financing to COUNTERWORKS: Shoko Chukin Bank's Startup Business Department has provided a loan of 100 million yen to COUNTERWORKS as funding necessary for business expansion; COUNTERWORKS is a startup that provides short-term commercial real estate platforms and other services; the company's "Shop Counter" service matches lessors and lessees for short-term use of commercial spaces, and is used for pop-up store openings and event hosting; this case was handled without guarantees in accordance with the "Guidelines for Management Guarantees"
• MUFG Innovation Partners participate in Relcu's funding round: Relcu has raised new funding with participation from both new and existing investors, including Menlo Ventures, Detroit Venture Partners, Clocktower Ventures, MUFG Innovation Partners, Commerce Ventures, and Valley Ventures; Relcu provides an all-in-one Unified CRM and AI Agent Co-Pilot built for financial services; the capital will accelerate Relcu’s mission to help financial institutions boost customer conversion, strengthen retention, and expand cross-sell by transforming static systems of record into AI-powered systems of action
• SBI leads DigiFT's strategic round to scale institutional-grade RWA infrastructure: DigiFT, a licensed exchange purpose-built for institutional-grade, tokenized real-world assets (RWAs), has raised a total of US$25 million to date—following the close of a new strategic funding round; the latest round was led by SBI Holdings, with participation from leading institutional investors including Mirana Ventures, Offchain Labs (Arbitrum), Yunqi Partners, Polygon Labs, and founders and senior leaders of leading global technology and financial firms; the capital will support DigiFT’s continued expansion as a next-generation RWA infrastructure provider—bridging traditional asset management and onchain finance through compliant, tokenized investment products
• AND Global secures USD 21.4m Series B led by IFC and AEON Financial Service: AND Global has raised $21.4 million USD in a Series B funding round led by the International Finance Corporation (IFC), a member of The World Bank Group, and AEON Financial Service, a leading Japanese financial group active in 11 Asian markets; other investors in this Series B round include: Marubeni Corporation, a major Japanese trading conglomerate with a growing footprint in digital finance, SBI Holdings, a leading internet-based financial conglomerate headquartered in Tokyo, Premium Group, a Japanese auto mobility financing and services company; this investment will support further development of AND Global’s services, such as digital lending and other fintech solutions, to improve financing access for small businesses, as well as the unbanked and underbanked across Asia; with the successful completion of its Series B, AND Global now becomes the first Mongolian company to secure Series B funding, further solidifying its mission to bridge the financial inclusion gap in Southeast Asia
• Uncovered Fund & Monex Ventures Launch USD 20m Africa Fund: a new partnership between specialist venture capital firm Uncovered Fund and corporate VC Monex Ventures highlights increasing Japanese investment in Africa's technology landscape; the two have launched the "Uncovered Monex Africa Investment Partnership," a ¥3 billion (around $20 million) fund targeting early-stage startups in Africa and the MENA region; the fund will provide capital to companies developing the continent's foundational digital and physical infrastructure, concentrating on four primary sectors: finance, distribution, mobility, and sustainability
• SMBC has made an investment in the Novastar Ventures Africa People and Planet Fund III; as one of Africa's largest venture capital firms, Novastar backs bold entrepreneurs tackling critical social and environmental challenges in sectors like fintech, mobility, and green tech; this investment, made through SMBC's "Social Value Creation Investment Fund," directly supports the growth of startups that are building the continent's future infrastructure
• Known for its global network and successful track record, WERU has secured a unique position within Japan's venture capital ecosystem; in an interview with The Worldfolio, President Tadashi Takiguchi shares his views on the sector’s growth and explains what makes his company stand out

Banking

• Seven Bank commences capital & business alliance discussions with ITOCHU Corporation: Seven Bank agreed with ITOCHU Corporation, majority owner of Family Mart, on the commencement of capital and business alliance discussions including collaboration in a wide range of financial areas; Seven Bank operates at more than 28,000 ATMs nationwide, including locations at 7-Eleven stores, shopping centers, tourist destinations, airports, and stations; nationwide deployment of the new type of ATMs has been completed; they are equipped with identification document recognition and facial recognition features in addition to the existing cash deposit and withdrawal functions
• SBI resumes regional bank partnerships, to acquire up to 3% of Tohoku Bank: SBI Holdings has concluded a “Strategic Capital and Business Alliance Agreement” with TOHOKU BANK; having completed the repayment of public funds for SBI Shinsei Bank, the group is now free to resume its regional banking rollup strategy in order to create the "fourth mega bank"; SBI Regional Bank Holdings, a wholly owned subsidiary of SBI Holdings, plans to acquire up to 2.95% of the total issued shares of TOHOKU BANK (excluding treasury shares, shares less than one unit, and other shares without voting rights) as of the end of March 2025; TOHOKU BANK plans to acquire up to JPY 100m worth of SBI Holdings' issued common shares
• SMBC unveils a comprehensive strategy for Africa's future at TICAD9: this past week has marked a pivotal moment in Sumitomo Mitsui Banking Corporation's (SMBC) engagement with the African continent; against the backdrop of the 9th Tokyo International Conference on African Development (TICAD9), SMBC has announced a series of strategic partnerships and investments that underscore a deep and multi-faceted commitment to fostering sustainable growth, driving innovation, and promoting financial inclusion across Africa; these initiatives are not isolated deals but a clear, cohesive strategy targeting key pillars of economic and social development: strengthening the financial backbone, empowering technological innovation, and tackling critical sector challenges
• In other news, Sumitomo Mitsui Banking Corpoation has secured approval from the Reserve Bank of India to acquire up to 24.99% of YES BANK; the deal, initially set at a 20% stake for $1.6 billion, marks a significant cross-border M&A transaction in India's financial sector; the RBI has also decided that SMBC will not be considered a "promoter" of Yes Bank post-acquisition; the acquisition was announced in May 2025, pending regulatory approval
• Finastra completes the first-ever Loan IQ deployment in Japan: Leading financial services software firm Finastra has gone live with the Loan IQ platform at the Japan International Cooperation Agency (JICA); this project aims to modernize JICA's core system for private-sector investment finance, an increasingly expanding initiative that provides loans to private sector projects in developing countries; the implementation for JICA represents the first-ever deployment of Loan IQ in Japan; the solution, implemented in partnership with IBM Japan, supports JICA's growing need for scalable, flexible, and globally compliant lending capabilities
• The Financial Services Agency has released an English translation of its working group report on "Improving Internal Audits of Financial Institutions"

Payments

• Japan’s credit and charge card payments market is projected to grow by 9.4% in 2025 to reach JPY129.6 trillion ($857.3 billion), driven by the rising consumer preference for non-cash transactions and wider acceptance of credit cards among merchants, according to GlobalData, a leading data and analytics company
• Now that JPYC was officially registered as a "Fund Transfer Service Provider" (Registration Number: Kanto Local Finance Bureau No. 00099) under Article 37 of the Payment Services Act on August 18, 2025, and will become the first fund transfer service provider in Japan to issue electronic payment instruments (stablecoins) that are pegged 1:1 to the Japanese yen, we wanted to remind everyone of the FSA's regulatory framework, which includes three types of stablecoin issuers: (I) banks issue stablecoins as deposits; (II) fund transfer service providers issue stablecoins as claims on outstanding obligations; and (III) trust companies issue stablecoins as trust beneficiary rights
• Underpinning the vision for a tokenized future is the need for reliable, regulated digital cash; SBI revealed a comprehensive, three-part strategy to ensure the availability and circulation of best-in-class stablecoins in Japan, targeting both USD and JPY currencies: (I) SBI Holdings and Circle Internet Holdings, the issuer of USDC, are establishing a formal joint venture to promote the circulation of USDC and develop new Web3 use cases in Japan; (II) in a separate agreement, SBI Group has signed a Memorandum of Understanding with Ripple to become a key distribution partner for its new USD-backed stablecoin, RLUSD, in Japan; leveraging its Electronic Payment Instrument Services Provider License, SBI VC Trade aims to make RLUSD available to the Japanese market within the fiscal year ending March 31, 2026; and (III) to address the domestic market, SBI VC Trade has entered into a basic agreement with one of Japan's largest megabanks, Sumitomo Mitsui Banking Corporation (SMBC); the two financial giants will jointly explore the "sound distribution and utilization" of a JPY-backed stablecoin issued by SMBC
• Simplex and Ava Labs conduct joint verification of next-generation remittance and settlement network: Simplex and Ava Labs have conducted a proof of concept combining Simplex's stablecoin issuance and redemption system "Simplex Stablecoin" with Ava Labs' blockchain infrastructure service "AvaCloud" to achieve financial services-grade availability and low latency; as a result of the verification, the partners confirmed that processing can be performed with high availability through redundant configurations including geographical distribution, while maintaining high throughput and low latency with finality in under 1 second; moving forward, both companies will continue to promote proof of concepts assuming specific use cases for the social implementation of stablecoins, and will strive to promote new market entry by many business operators
• Slash has published an updated version of its whitepaper "Pioneering PayFi for Japan," describing a Japan-compliant self-custody payment stack and a direct spending, zero custody approach

Capital Markets

• We moderated the panel on Crypto ETFs at the WebX FinTech Expo in Osaka on Friday, sharing the stage with Takashi Takamura, Country Head at Franklin Templeton Japan, Tomoya Asakura, Chief Executive Officer at SBI Global Asset Management, and Eugene Cheung, Chief Commercial Officer at OSL, covering the state of Crypto ETFs around the globe as well as the outlook for Japan
• Dalton Investments has sent a letter to the Minister of Economy, Trade and Industry (METI), the Minister of Justice, the Commissioner of Financials Services Agency (FSA), and the heads of the Japan Exchange Group (JPX) urging them to consider structural changes to the timing of annual financial statements and Annual General Meetings (AGM); the letter was co-signed by 130 institutional investors, representing over JPY 150 trillion in AUM, who also support changes that include earlier disclosure of annual reports and more flexible AGM scheduling, to ensure investors can make informed decisions and engage meaningfully with companies
• Japan Exchange Regulation (JPX-R) has published its annual report; JPX-R is a corporate body established under Japan Exchange Group (JPX) to specialize in self-regulatory operations of financial instruments exchanges in accordance with the Financial Instruments and Exchange Act of Japan; since its establishment in 2007, JPX-R has engaged in operations while always keeping in mind its mission and the maintenance of independence as a self-regulatory organization

Digital Assets

• SBI Holdings has announced a strategic joint venture with Singapore-based crypto infrastructure leader Startale Group: the collaboration aims to develop and launch a comprehensive on-chain trading platform focused on tokenized stocks and real-world assets (RWAs); key features of the new platform will include: (I) true 24/7 trading; (II) near-instant cross-border settlement; (III) fractional ownership; and (IV) DeFi composability
• Connecting the vision for tokenized assets with the stablecoin strategy is "Project Trinity," a major proof-of-concept initiative to modernize Japan's security token market; an impressive consortium of eight leading financial and technology firms—including SMBC, Daiwa Securities, SBI Securities, Osaka Digital Exchange (ODX), SBI R3 Japan, BOOSTRY, Progmat, and Datachain—has officially launched the project; the goal is to use stablecoins to enable Delivery Versus Payment (DvP) settlement for security token trades on the secondary market; currently, the exchange of a security token and its payment happen separately, creating counterparty risk; Project Trinity aims to eliminate this risk by using smart contracts to ensure the instantaneous and simultaneous exchange of the token and a stablecoin payment

The Last Word: Techstars Tokyo 2025

Techstars Tokyo Accelerator revealed the 12 companies selected for its second class:

• Blueconomy AI (Bangalore, India): adding an intelligent decision layer to supercharge the global port operations workflow
• Boxtree (San Francisco, US): Boxtree creates fun multiplayer games with infinite replayability for the era of spatial computing
• Cascade (Tokyo, Japan): an intuitive analytics platform with AI agents that turn insight into action.
• Contera AI (Delaware, US): Contera.ai turns company and market data into profit-boosting ads and SEO — automatically
• DLeader (Osaka, Japan): faster, smarter drug discovery for all researchers through AI agents
• O-ID (Tokyo, Japan): building a fully modular humanoid robotics platform specifically designed for critical environments
• Vibtree (San Diego, US): voice AI agent platform for sales and customer support communications
• Overwatch (Barcelona, Spain): the first AI-native manual and content reader designed for high-stakes frontline environments
• Plexis AI (Kuala Lumpur, Malaysia): adaptive AI agents as clinical infrastructure — automating 40% of admin waste with human-level reasoning in real-time
• SoranoAI (Palo Alto, US): no-code AI agent for weather intelligence in energy, agriculture, and logistics
• Tokoshie (Tokyo, Japan): AI-powered 3D printing platform that helps manufacturing companies turn ideas into parts, faster, cheaper, and without expert knowledge
• Trissino (San Francisco, US / Tokyo, Japan): redefining competitive intelligence with AI to help B2B teams win more deals

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