Japan’s financial firms finding new value in digital domain

The Yomiuri Shimbun

1:00 JST, September 9, 2022

Financial companies are racing to find new value with the latest digital solutions. Megabanks and other financial institutions are using their expertise of processing large volumes of payments in order to expand the range of their business contacts and explore new opportunities.

Blue Lab Co., an IT venture backed by Mizuho Bank, recently started offering training courses aimed at improving workers’ digital skills. Based in Tokyo’s Toranomon district, the classes focus on improving the digital skill levels of nonexperts, rather than those already in highly specialized IT positions.

“It is important to be able to talk with outside contractors on an equal basis and create a system in which all people concerned can work comfortably,” said Blue Lab’s Yoshiaki Tamura.

Members of the Yamanashi Chuo Bank, Ltd.’s digital transformation and innovation promotion office have been taking the initial classes of the monthslong course.

Lessons will include the usage of cloud-based systems and artificial intelligence.

“I will be able to use what I learn here when helping business partners, for example,” said participant Yohei Otagiri, 31.

Mizuho Bank suffered a series of system failures last year. The bank then learned from the failure that it could not take advantage of its systems built on the expertise of four major IT companies.

In April, Resona Holdings Inc. established the Resona Digital Hub Co. in collaboration with IT companies and has held business negotiations with more than 100 companies. Resona Digital Hub hopes to tap the needs of small and midsize firms hoping to improve their digital systems.

“We want to provide a wide range of companies with payment methods that we have developed in our banking operations by combining them with cashless and other IT technologies,” Resona Digital Hub President Naoki Ito said.

Driving some of these moves are the growing concerns that a lack of IT talent could be a barrier to the nation’s economic growth.

The Economy, Trade and Industry Ministry said Japan will be short of 430,000 IT specialists in 2025. According to the Information-technology Promotion Agency, 76% of Japanese companies report a shortage of IT workers.

In the securities industry, however, SBI Holdings Inc., Japan’s biggest online brokerage, is already providing banking systems, apps and other solutions to regional banks.

Competition in digitization has been ramping up and the financial community seems eager to find value in this new growth area.