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Why Fintech Is Not Changing Japanese Banking

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  • Naoyuki Iwashita

Abstract

Several years have passed since fintech first attracted attention in Japan. Although various new fintech services have emerged due to deregulation and policies to promote fintech's development and adoption, the overall composition and functioning of Japan's financial industry has not changed significantly despite fintech advances in other economies. The industry in Japan continues to be dominated by face‐to‐face interactions and has experienced little digitization. In Japan, sophisticated financial services were available before the widespread use of the internet, and most people have resisted conducting financial transactions using their smartphones. In addition, there has been almost no progress in digitizing accounting work in corporations. However, this stagnation in digitization on the demand side of financial services is changing for several reasons. Digitization in the government sector and the introduction of a new invoice system in 2023 will provide an opportunity for change. This time, Japan's financial services should undergo a significant digital transformation.

Suggested Citation

  • Naoyuki Iwashita, 2022. "Why Fintech Is Not Changing Japanese Banking," Asian Economic Policy Review, Japan Center for Economic Research, vol. 17(2), pages 297-310, July.
    • Handle: RePEc:bla:asiapr:v:17:y:2022:i:2:p:297-310
    DOI: 10.1111/aepr.12390
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    References listed on IDEAS

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    1. Erel, Isil & Liebersohn, Jack, 2020. "Does FinTech Substitute for Banks? Evidence from the Paycheck Protection Program," Working Paper Series 2020-16, Ohio State University, Charles A. Dice Center for Research in Financial Economics.
    2. Isil Erel & Jack Liebersohn, 2020. "Does FinTech Substitute for Banks? Evidence from the Paycheck Protection Program," NBER Working Papers 27659, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Yuko Kawai, 2022. "Comment on “Why Fintech Is Not Changing Japanese Banking”," Asian Economic Policy Review, Japan Center for Economic Research, vol. 17(2), pages 311-312, July.
    2. Yiping Huang & Takatoshi Ito & Kazumasa Iwata & Colin McKenzie & Shujiro Urata, 2022. "Digital Finance in Asia: Editors' Overview," Asian Economic Policy Review, Japan Center for Economic Research, vol. 17(2), pages 163-182, July.

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