Japan Fintech Boom Incoming

Japan’s economy is about to receive a major boost in the form of financial technology.

It is unfortunately the case that the Japanese government, in combination with various Japanese corporations, are notoriously strict and unrelenting in their pursuit of regulations and standardization.

But it now appears that the government and corporate sector have recognized the error of their ways.

Japanese regulators are about to loosen rules surrounding fintech investment in a major way.

Due to Japan’s homogenous population and adherence to cultural norms, fintech firms found it difficult to grow in a country with a cash culture, strict financial regulations and extremely cheap credit, a situation that didn’t appear to be changing any time soon.

Through the first nine months of 2015, the Japanese fintech sector received only $44 million, a paltry sum compared to all other developed nations.

Over the past several years, with the growth of both the fintech sector and capital in Japan, banks like Mitsubishi UFJ Financial Group and Sumitomo Mitsui Financial Group are pushing for higher stakes in fintech startups.

Japanese regulators recently announced that they were close to creating a new set of rules for financial technology. Japan’s Financial Services Authority (FSA) told Reuters that “fintech will have a big impact on financial services” and “the law changes aren’t a goal, but a first step.”

Part of these changes include opening up capital investment regulations, which may create an enormous flow of cash and investment into fintech companies in Japan.

Additionally, the FSA is also interested in bringing bitcoin and blockchain technologies onto the forefront of the Japanese economy.