Japanese Fintech Leader Smartpay Launches First Bank Direct BNPL Service

Yahoo Finance | Dec 26, 2022

TOKYO, Dec. 27, 2022 /PRNewswire/ — Japan-based fintech Smartpay has launched Smartpay Bank Direct, the country’s first digital consumer finance service that allows customers to pay for online installment purchases straight from their bank accounts. Smartpay Bank Direct emphasizes user security while delivering convenience for the consumer, through a network of 67 partner banks across Japan[1]. Smartpay is Japan’s first digital consumer finance company to utilize Japan’s open banking system.

While Japan remains the third wealthiest country in the world, it has one of the highest credit card penetration rates in Asia, with over 60% of transactions completed in cash.

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Smartpay’s application has received wide acceptance from consumers and merchants that prefer beautifully uncomplicated digital payments, which supports the transformation of a cash-based society into a digital one.

The company’s strategy was built in two phases. The first phase was focused on financial inclusion, and helping those that don’t have access to credit, to join the digital BNPL economy. It also solved the issue of cash usage and created a platform and an ecosystem to move towards a paperless payment system that would be more efficient.

Smartpay is moving into the next phase of its digital consumer finance journey, which is focused on targeting middle and high-income users and offering them smart financial solutions that are safe, convenient, fast and create real value for the entire ecosystem.

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When fintechs took over payments, they not only took away the transaction values, but also the critical data that had guided the customer acquisition strategy of banks for decades. Without these insights, the legacy banks had to rely on high acquisition cost for insurance and wealth management, which affected their profitability because they were missing the key relevant data to offer the right products and services at the right time.

What differentiates Smartpay from other fintech companies is that it works with the existing legacy banks rather than against them.

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