Japan FinTech Observer #146

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

According to Morgan Stanley Investment Management, Japan is running hot. Can you feel it?

Here is what we are going to cover this week:

• Venture Capital & Private Markets: Credit Saison supports Mylapay's USD 1m bridge financing
• Insurance: Tokio Marine Group's ~$1 billion acquisition of Commodity & Ingredient Hedging
• Banking: the best performing Asia-Pacific bank stocks in 2025; MUFG to establish a universal bank in the European Union; Jenius Bank, a digital bank division of SMBC Group, is closing
• Payments: AEON Financial posts 10% operating profit growth for nine-month period; Lacoste Japan taps Riskified AI to drive ecommerce efficiency, boosting authorization rates to 90%
• Capital Markets: JAMP Fund Management debuts ETF white-label service; Alpaca targets Indian market expansion with strategic acquisition of GIFT City broker Zincmoney
• Asset Management: Finatext subsidiary Nowcast launches AI-ready data platform for Daiwa Asset Management; FOLIO Holdings - Designing tomorrow's finance
• Digital Assets: Coincheck to acquire digital asset manager 3iQ in USD 112m share deal to boost global institutional footprint
• The Last Word: Who will buy Japanese Government Bonds?

After a successful launch last week, our weekly online forum, which we aim to host every Tuesday at 9pm JST, will be streamed on LinkedIn Live (and YouTube & Twitter) going forward. Supported by our friends at Alpaca and ITFOR, we will also go offline and in-person again. Please check out our schedule on Luma.

Venture Capital & Private Markets

• Credit Saison supports Mylapay's USD 1m bridge financing: Payment infrastructure startup Mylapay has secured $1 million in a fresh capital injection, fortifying its balance sheet ahead of a planned Series A fundraise; the bridge round saw follow-on commitments from existing investors CDM Capital and Credit Saison, while Pratekk Agarwaal’s GrowthCap Ventures joined the cap table as a new backer, supported by a cohort of strategic angel investors

Not FinTech

• Rakuten Medical has closed a $100 million Series F financing round, securing the capital necessary to propel its lead oncology asset through late-stage clinical trials and toward a targeted U.S. regulatory submission in 2028; the financing was led by TaiAx Life Science Fund, a venture vehicle jointly established by Taiwania Capital and Japan’s Axil Capital; the round attracted the largest group of institutional investors in the biotech firm’s history, including heavyweights from the Japanese financial sector such as Daiwa Securities, Mitsui Sumitomo Insurance, and Sumitomo Mitsui Banking
• UnlimiTech, a Tokyo-based startup aiming to digitize legacy workflows in the manufacturing sector, has completed a 75 million yen ($500,000) funding round; the capital injection was structured through a combination of third-party allotments, including J-KISS type stock acquisition rights, and debt financing; the round saw participation from domestic venture capital, Mizuho Bank, and the Japan Finance Corporation (JFC)

Insurance

• Tokio Marine Group got a shout-out in FT Partners' recent "Commodities FinTech" report: "The space has attracted recent attention following Blackstone’s $6 billion+ acquisition of commodities software and data provider Enverus, and Tokio Marine Group's ~$1 billion acquisition of Commodity & Ingredient Hedging."

Banking

• According to S&P Global, the best performing Asia-Pacific bank stocks in 2025 where dominated by small(er) Pakistani and Japanese banks
• MUFG to establish a universal bank in the European Union: Within a shifting geopolitical and regulatory environment, Mitsubishi UFJ Financial Group (MUFG) has executed a meticulous calibration of its legal entity structure to ensure continuity of access to the EU Single Market while optimizing capital efficiency and regulatory compliance; at the heart of this European strategy lies MUFG Bank (Europe) N.V. (MBE), a distinct legal entity domiciled in the Netherlands; the analysis of MBE's structural identity reveals a dual-track strategy: utilizing a fully capitalized Dutch subsidiary to passport commercial banking services across the European Economic Area (EEA), while simultaneously retaining direct branches of the Japanese parent bank in specific jurisdictions to leverage the colossal balance sheet of the global group; furthermore, MBE is being transformed from a specialized commercial lender into a "Universal Bank" through the impending absorption of MUFG’s securities operations—a move that signifies the maturation of MUFG’s European business model into a fully integrated financial services platform; pursuant to relevant approvals, this realignment is planned for the 2026/27 fiscal year
• Jenius Bank, a digital bank division of SMBC Group, is closing, according to several now-former employees; Jenius has not made an official announcement, and representatives for SMBC had no comment; but two former employees confirmed mass layoffs and that Takeshi Okamoto, chair and CEO of Jenius’ legal entity SMBC Manubank, informed them in a virtual all-hands meeting Thursday that Jenius would be shutting down

Payments

• AEON Financial posts 10% operating profit growth for nine-month period: AEON Financial Service has demonstrated notable resilience in its performance for the nine months ending November 30, 2025, achieving robust top-line growth; the company's results tell a clear story: its strategic investments in a powerful domestic banking and digital payments ecosystem are generating a low-cost funding engine that is proving critical in counteracting margin pressure from higher funding costs; the 10% year-over-year increase in operating profit was primarily fueled by strong performance across core revenue streams; increased loan revenue contributed an additional ¥6.8 billion, while installment finance revenue grew by ¥7.7 billion
• Lacoste Japan taps Riskified AI to drive ecommerce efficiency, boosting authorization rates to 90%: Lacoste Japan has reported a significant recovery in its digital transaction processing capabilities, announcing that authorization approval rates have surged to 90% following the integration of Riskified’s (NYSE:RSKD) AI-driven fraud detection platform; the implementation, completed in May 2025, marks a strategic pivot for the French apparel giant’s Japanese arm, which had previously grappled with approval rates hovering near 70%; according to the company, the legacy rule-based systems previously in place resulted in a high volume of manual reviews, creating logistical bottlenecks and forcing warehouse teams to intercept shipments reactively

Economics

• The Bank of Japan has published its "Regional Economic Report (Summary)" for January 2026; all nine regions reported that their respective economies had been recovering moderately, picking up, or picking up moderately, although some weakness had been seen in part
• Goldman Sachs has made its "2026 Japan Economic Outlook" publicly available, without any redactions; the analysts expect (I) steady growth to continue in 2026, led by domestic demand, (II) underlying inflation to rise moderately amid continued high wage growth, (III) monetary policy to reach a crucial stage for sustainable achievement of 2% Inflation, and (IV) a year to assess the impact of the expansionary fiscal policy on fiscal soundness
• Mitsubishi UFJ Research & Consulting has published "The Japanese Economy in Fiscal 2025 and Fiscal 2026"

Capital Markets

• The trading volume of single stock options (SSOs) on the Osaka Exchange (OSE) has reached 3,438,374 contracts in 2025, marking the highest level since the market was launched; in addition, the notional amount of trades for the same year was approximately JPY 494.1 billion, the highest figure since the integration of the OSE and Tokyo Stock Exchange (TSE) derivatives markets in 2014.
• JAMP Fund Management debuts ETF white-label service: JAMP Fund Management has entered into a strategic partnership with Nippon Value Investors, marking the first commercial deployment of its newly established ETF white-label service; the collaboration aims to list a Japan-domiciled active ETF on the Tokyo Stock Exchange (TSE) by spring 2026; the agreement serves as a proof-of-concept for JAMP’s proprietary white-label framework, which was officially launched in June 2025; billed as Japan’s first fully integrated, end-to-end support system for ETF structuring, the platform is designed to decouple investment decision-making from operational administration
• Alpaca targets Indian market expansion with strategic acquisition of GIFT City broker Zincmoney: Japanese-founded, U.S.-based brokerage infrastructure provider Alpaca announced its intent to acquire Zincmoney IFSC Private Limited, a move designed to secure a regulatory foothold in India’s burgeoning financial services sector; the transaction centers on Zincmoney’s operations within the Gujarat International Finance Tec-City (GIFT City), India’s tax-neutral financial hub; by acquiring Zincmoney, a broker-dealer regulated by the International Financial Services Centres Authority (IFSCA), Alpaca aims to bypass the lengthy process of organic licensure and immediately establish an operational entry point into the region

Asset Management

• Finatext subsidiary Nowcast launches AI-ready data platform for Daiwa Asset Management: Nowcast, a subsidiary of the Finatext Group, has successfully completed development and deployment of "DAM-AICore," a proprietary generative AI application tailored exclusively for Daiwa Asset Management; the move marks a significant step in the asset manager’s digital transformation (DX) strategy, combining a custom front-end AI interface with a robust, backend data infrastructure overhaul; the initiative addresses the growing demand within the financial sector to leverage large language models (LLMs) for operational efficiency and sophisticated market analysis; Nowcast, leveraging its expertise in alternative data and financial systems, designed the DAM-AICore solution to operate within a secure, independent AWS environment specific to Daiwa
• FOLIO Holdings - Designing tomorrow's finance: FOLIO Holdings is an innovative financial solutions company operating within the larger SBI Group, driven by a powerful and forward-looking core mission, "Designing tomorrow's finance"; FOLIO's flagship product is ROBOPRO, an AI-powered investment service first launched in January 2020; the most important feature of ROBOPRO is its use of AI to predict market movements and perform proactive, agile rebalancing of the investment portfolio to respond to changing conditions; this service's strategy is utilized by the "ROBOPRO Fund," a public investment trust established in December 2023

Digital Assets

• Coincheck to acquire digital asset manager 3iQ in USD 112m share deal to boost global institutional footprint: Coincheck Group N.V. (Nasdaq: CNCK) has entered into a definitive agreement to acquire Canadian alternative asset manager 3iQ in an all-stock transaction valued at approximately $111.8 million; the deal will see the Nasdaq-listed holding company purchase a 97% controlling interest in 3iQ from its own majority shareholder, Monex Group; under the terms of the agreement, Coincheck will issue approximately 27.1 million new ordinary shares to Monex, based on a valuation of $4.00 per Coincheck share (closing price on January 8: $2.81); the company also intends to acquire the remaining minority interest on substantially equivalent terms, targeting 100% ownership upon the transaction’s expected closing in the second quarter of 2026

The Last Word: Who will buy Japanese Government Bonds?

A recent NLI Research Institute report examines the shifting landscape of Japanese Government Bond (JGB) ownership as the Bank of Japan reduces its massive holdings. With long-term interest rates rising due to monetary policy normalization and fiscal expansion, the analysis highlights a growing need for private investors to fill the resulting vacuum.

While banks and foreign investors have increased their positions, the author argues that these groups can be volatile or sensitive to short-term earnings. Consequently, the paper emphasizes the importance of household investment in JGBs as a stabilizing force for the market.

To encourage this, the source suggests improving the attractiveness of bond products, such as adjusting interest rate formulas or introducing longer-term options. Ultimately, mobilizing individual savings is presented as a vital strategy for ensuring the steady absorption of national debt.

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 & Paragraph, or 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.