Best online Banks in Japan
All over the world, the way banks work is changing in a big way. Every week, new digital banks pop up in Europe, Latin America, the United States and United Kingdom, and Southeast Asia. Japan? Not really.
Japan has been on the cutting edge of technology for decades, but it is very far behind in putting in place independent online banking platforms. It is hard to compete for the position of the best online banks in Japan.
Best online Banks in Japan
Japan has almost 200 banks that have been approved by the government (30 major, 100 regional, and 55 foreign banks). Still, the big three traditional banks—MUFG Bank, Sumitomo Mitsui Banking, and Mizuho Bank—have a lock on the banking market.
Still, there are neo banks like Rakuten Bank and Sony Bank that are challenging the status quo, and competing for the position of the best online banks in Japan. Some of them have been doing this for more than 20 years. Others, such as Minna Bank, are just starting out. There are also Wise and Revolut in the UK.
And while Wise offers a similar service to what it does in its home country, Revolut has fewer features than its apps do in its home country.
What makes Japan’s online banks stand out is that almost all of them are backed by large, well-known companies. The companies that started these digital players have a lot of business experience and valuable ecosystems that give them important advantages.
This has been a big part of their success, as they use their strong brand recognition with existing customers and smart data to learn more about their customers and tailor their products to them.
Best online banks in Japan
Since the end of 2019, when the Japanese government started helping digital payments in some ways, Japan has been moving toward a cashless society. After the pandemic, this campaign is more important than it was before.
Global social distancing mandates drive cashless payments and make them more of the norm.
Here’s a look at both well-known and the best online banks in Japan.
Best Online Banks in Japan
- Founded: 2008
- Founders: KDDI Corporation, Bank of Tokyo-Mitsubishi
- Headquarters: Shinjuku-ku, Tokyo
- Banking, savings, investing
- Foreign currency deposits
- Deals with other countries
- Card and loans for homes
- Debit cards
Jibun Bank, which means “my bank,” was started in 2008 as a partnership between the Japanese communications company KDDI Corporation and The Bank of Tokyo-Mitsubishi UFJ.
It was one of the first banks to offer mobile banking because it was the first bank in Japan to make a banking app for smartphones.
Since the beginning, Jibun Bank has been aimed at Generation Y, which is mostly made up of people who use cell phones. With 29% of its customers in their 30s, 28% in their 40s, and 20% in their 20s, the bank has made a name for itself in the younger market in less than ten years.
Jibun Bank accepts deposits in yen and other currencies, as well as time deposits, investments in stocks and trusts, competitive loans for housing and credit cards, and more.
- Started in 2015
- Founders: Shinichi Takatori
- Banking, prepaid cards, sending money abroad, and managing money
- Prepaid Visa card
- Budgeting and looking at data
- Joint accounts
- Bill splitting
- Cash-back bonuses
Shinichi Takatori, the founder and CEO of the company, came up with the idea for Kyash, a fintech company. The digital bank was started in 2015, and unlike most digital banks, it was built on its own banking infrastructure.
Even though the company doesn’t have a banking license, it has applied for other licenses in Japan that would allow it to offer more services.
At the moment, Kyash has a prepaid Visa card that can be used to pay for things and get cash from Seven Bank ATMs.
Their sleek mobile app has a great budgeting and analytics section that gives you a detailed look at how you spend your money.
Overall, Kyash is a modern digital bank like the ones we see in the West. It has an easy-to-use sign-up process, a beautiful app, and other features that we now expect to see.
- Founded: 2019
- Founders: Fukuoka Financial Group
- Headquarters: Nishinakasu, Chuo-ku, Fukuoka
- Personal banking and savings
- Wallet Virtual debit card
- Budgeting and analytics
- Savings account
- Overdraft protection
Minna Bank, which in Japanese means “a bank for everyone,” just got its banking license in December 2020. It began running at the end of May 2021, and its goal is to “provide everyone with valuable connections.”
If you thought that Minna was an independent digital bank, you would be wrong. It is owned by the Fukuoka Financial Group, which is Japan’s largest regional financial group. Their Digital Transformation (DX) strategy includes Minna.
The Bank of Fukuoka, The Kumamoto Bank, and The Juhachi-Shinwa Bank, which are all FFG subsidiaries, have already taken over the Fukuoka area. With Minna Bank, they want to reach people in Japan between the ages of 15 and 40.
It will be the first Japanese bank to use the electronic version of “know your customer” (eKYC) to allow account opening 24 hours a day, 365 days a year. Customers will just have to scan their driver’s licenses or other photo IDs, and then they can use video to prove who they are.
Minna has a virtual debit card, a savings account, budgeting and analytics tools, cashback, and protection against overdrafts.
- About PayPay Bank:
- Founded: 2018
- Founders: SoftBank Group and Yahoo Japan
- Headquarters: Chiyoda, Tokyo
- Banking, savings, loans, investing, FX
- Easy to open online
- Personal and business accounts
- Visa debit card
- Personal and business loans
- Cardless deposits and withdrawals
Yahoo Japan and the well-known SoftBank Group got together to start PayPay Bank. With more than 38 million users, PayPay has become the most popular mobile payment app in Japan in just three short years.
PayPay has many benefits, such as a new Visa card (before, there were only QR codes), low-interest card loans, mortgage loans, no deposit or withdrawal fees, deposits in foreign currency, investments that start at YPJ500, international money transfers, and a lottery.
A PayPay account can also be used by sole proprietors and businesses. It comes with a business app, a Visa debit card, business loans, free sales deposits, and more.
Sole traders can easily open an account by uploading the necessary documents from their phones, but businesses will have to mail them in.
- Founded: 2000
- Founders: Rakuten Group, Inc.
- Headquarters: Minato-ku, Tokyo
Banking, savings, life insurance, credit cards
- Yen and deposits in other currencies
- Sending money abroad
- Personal loans
- More than 11,000,000 accounts
- Rakuten just passed 11 million accounts, making it Japan’s biggest digital bank by number of accounts.
In 2001, the big fintech company Rakuten opened a digital banking service, and the people of Japan quickly learned that it was the best place to bank 24/7. People are using their Rakuten bank account as their main account more than ever, which is why the company is offering more and better services.
It updated the look of its banking app and added Rakuten Bank’s instant payment service to it. The Rakuten Bank is also a good choice for a lot of other reasons. For example, you can deposit and withdraw cash at convenience stores, get up to seven free ATM withdrawals per month, get cashback rewards and mortgages, and trade Forex.
Many specialized institutions and publications around the world have praised the bank. For instance, Rakuten has won the “Global Finance” award for seven years in a row for being Japan’s best online bank.
- Founded: 2015
- Founders: Nikolay Storonsky (CEO) and Vlad Yatsenko
- Headquarters: London, England
- Personal accounts and business accounts
- Free and Premium (¥980/m) accounts
- Budget and analytics
- Money transfers
- Group bills
- Cash-back rewards
By the end of 2020, Revolut had tested its service on 10,000 beta users and was ready to enter the Japanese market. Compared to its accounts in Europe, it doesn’t have as much to offer.
There are only personal accounts, which include a free Standard account with a free debit card, no fees for international ATM withdrawals (up to JPY25,000/m), and other benefits.
There is also a Premium account that costs JPY980/m and has some other features that are more or less helpful. On their website, there is a hint about their Metal account, which, when it becomes available, will cost JPY1,800/m. With the Metal account, you get a debit card made of metal and more spending and ATM withdrawal limits. You also get free foreign exchange with no monthly limit.
As we’ve already said, this is a somewhat limited account that lacks a lot of features like investing, saving, early payday, Pockets, insurance, Junior accounts, etc.
- Founded: 2001
- Founders: Ito-Yokado, Seven & I Holdings Co., Ltd
- Headquarters: Marunouchi, Chiyoda, Tokyo
- Banking, savings, loans
- Debit card
- Money transfers
- Network of ATMs
Seven Bank is a digital bank that is different from any other. Its business model is based on a network of ATMs in 7-Eleven and Ito Yokado convenience stores. The bank was called IY Bank until 2005. (Ito Yokado Bank).
It has a simple checking account with a debit card and a service for sending money to other countries. It also has regular and time deposits and card loans.
- Founded: 2001
- Founders: Sony
- Headquarters: Nishikichō, Tokyo
- Banking, savings, money transfers
- Multi-currency account
- Investment trusts
- Home loans
- You can send up to 11 currencies.
- Yen and other bank deposits
- Forex Investing
Sony Bank is one of the biggest digital banks in Japan. It was started more than 20 years ago and is a part of both Sony Financial Holdings and Sony.
It’s easy to see why it’s one of Japan’s most popular banks overall. It has Yen accounts, foreign currency accounts, and English banking for the growing number of foreigners living in the country.
Besides checking accounts, there are savings accounts in different currencies, Forex trading, investments, insurances, housing and credit card loans, etc. Basically, all the financial services you’d expect from a Japanese bank.
- Founded: 2011
- Founders: Kristo Käärmann (CEO) and Taavet Hinrikus (CEO)
- Headquarters: London, England
Personal and business accounts, money transfer
- Free account with several currencies
International bank details
- Accounts for personal and business use
- Safeguarded with leading banks
- Use your card to buy things with local money.
- Get your salary, pension, and other payments.
- Pay the real rate of exchange
- You can pay online safely and get updates in real time.
- More than 200 countries will accept your card.
- Get cash from any of the 2.3 million ATMs
- The KLFB controls it.
Wise (formerly TransferWise) is different from Revolut in that people in Japan can use most, if not all, of its features. This includes both personal and business accounts that can be opened quickly and easily online.
With a personal Wise Japan account, you can receive payments in 10 different currencies like a local, hold and convert 54 different currencies, use their debit card to spend money outside of Japan without any hidden fees, and transfer money much more cheaply and easily.
You can get money from abroad in currencies other than Yen if you have a business account. You can also buy things, pay bills, pay freelancers, and pay other people in more than 50 different currencies.
Wise has more than 10 million customers around the world. In Japan, the Kanto Local Finance Bureau (KLFB) regulates the fintech company, and your money is safe with well-known banks.
Benefits of the best online Banks in Japan
Online banks, smartphone banks, mobile banks, neobanks, challenger banks, digital banks, and other names are often used to describe digital banks.
The apps that digital banks make make it easy to keep track of your money 24 hours a day, 7 days a week. They are designed to give you a better view of all your accounts and help you save, budget, and plan. They do this by giving customers updates on transactions in real time, regular spending reports, and by putting spending into categories like bills, food, rent, etc., so that customers can see where they could cut back or when they could save.
Digital banks are very popular in Japan, and they offer the same services as traditional banks. Plus, they are more flexible and can make changes to what they offer much faster.
Challenger banks also charge a lot more fees, and they are more clear about what those fees are and don’t have any hidden fees that come as a surprise. Most of these banks are proud of the fact that they don’t have any hidden fees.
Many Japanese banks have also started to offer international cards that don’t charge fees for foreign transactions and can be used to get money out of ATMs abroad for free.
Even though fees are usually lower at Japanese neobanks, they can still make a lot of money and even be profitable.
With real-time spending reports, clients can stay very up-to-date on their finances. At the same time, automated advice helps customers decide how much they can spend safely and how much they can save. Because of these features, many people have opened an account, either as their main bank account or as a second account. Many digital banks fight for the position of one of the best online banks in Japan.
Even though most digital banks in Japan are run by conglomerates, some banks from other countries have made their way into the busy Japanese market.
There are many digital banks in Japan that compete to be one of the best online banks in Japan.
Revolut and Wise are two digital banks from the UK that have been operating in Japan for a few years. However, they don’t yet offer all of the services they do in other countries in Japan. There are also a number of online banks in Japan, like Rakuten Bank and Sony Bank, that offer their customers more up-to-date technology than the big three banks.
And even though the online banking market is growing, Japanese customers still have to deal with higher fees, complicated processes, and not being able to get flexible services easily.
For example, opening a foreign currency account, especially for business clients, is often a long process that requires thorough explanations and may not be approved by the bank in the end.
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