Fintech Consulting in Japan

Experience the Future of Finance: Innovation Unleashed with Enterslice's Expert Fintech Licensing Support in Japan. Navigating Regulatory Frontiers, Empowering Your Fintech Ventures for Success.

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Fintech Consulting & Licensing Support in Japan

Japan's financial services agency has recently incorporated a department that is responsible for promoting, facilitating, and monitoring fintech businesses in Japan. This new initiative is a welcoming window for the fintech players interested in establishing their business in Japan. Enterslice fintech licensing advisory and consultation can help you penetrate the Japanese fintech market. We have experts who are well versed in Japanese fintech license procedure and can assist you in making the entire process near at hand.

What is a fintech licensing?

In the due course of time, financial services have seen major changes. With the inference of finance with technology, the entire financial market landscape shifted to a more technology-oriented and friendly market approach. Nowadays, the entities entering the financial market have innovative business models. The aim of financial businesses nowadays has shifted from a tedious banking model involved in lending and savings accounts towards a much bigger and better profit-making financial entity with the use of Fintech.

From time immemorial, financial institutions always needed to comply with a variety of regulations. Similarly, rules and regulations are to be adopted by the fintechs in order to establish themselves in any territory. One such regulation is obtaining licensing per the municipal laws of any nation where the fintech entity plans to establish its business. These licensing requirements vary from nation to nation, but the basic structure is the same, which pertains to an innovative business model that has profit-making capabilities.

Enterslice Fintech Licensing Services Making Your Business

Remarkably innovative

Enterslice makes innovation look easy; if you are struggling for the right idea or a novel business plan, Enterslice is your one-stop solution.

Streamlined operation

At Enterslice, we believe in simplifying the business licensing process and eliminating the hurdles that a business might face due to foreign regulations.

Micro and macro-level planned

Be it strategic planning of every domain or task-based planning, Enterslice has a team of experts who can do everything for you.

With Enterslice, Embrace Your Journey as a Fintech Licensed Company By

Embarking your digital journey

At Enterslice, we understand the hustle due to the competitive marketplace, but we have modern solutions for your problems arising due to technological advancement.

Embracing financial fulfillment

Every company strives for a clear financial plan that has realistic investment goals. Financial freedom allows a company to prosper, and at Enterslice, we value your freedom by making license procurement streamlined.

Envisioning future

At Enterslice, we understand how important your organization's vision is for you, and we provide stimuli to this vision by making the licensing procedure easy so that you can focus on your core functions.

Enhancing customer satisfaction

At Enterslice, we believe in personalizing the user experience, which we do through multi-channel support. We understand our customers' needs and work in line with them.

Challenges for Fintech Procurement & How Enterslice Can Help You in Obtaining Fintech License In Japan

Challenges Faced by Fintech In Japan

Conservative Market

The corporations, as the consumer base of Japan, are highly risk aversing, and the conservative culture adds to the problem, leading to extremely low fintech investments.

Monopoly of Certain Fintech

It is a general trend in Japan that certain dominating institutions have a monopoly within the market, and the majority of the transactions are controlled by these private entities, making it tough for new players to penetrate the financial marketplace.

Rapid Regulatory Changes

The fintech regulation is new and is continuously going through the process of amendments, which is why the fintech businesses are going through constant change, making it difficult for them to comply with the ever-changing models of regulations.

Lengthy License Application

Lengthy application increases the probability of making mistakes. This is because the license application for Japan’s fintech license requires detailed annexures comprising a business description statement, organizational expertise chart, financial resources statement, financial statements including the balance sheets, projection of cash flow or any other additional calculations.

Enterslice customized licensing services

IPR assistance

Tradename and Trademark are the first steps for creating a legal entity for any business. Japan has its own set of IP rules according to which the financial institutions need to name their industry, and our team of IP experts will assist you in obtaining a tradename, Trademark and other intellectual property authentications.

System risk assessment and management assistance

Before applying for a license in Japan, it is important to have all the Paper works about risk assessment and Management ready because if any necessary paper is deficient, the licensing process gets shifted from a 3-month approval period to 12 month time period, Enterslice will help you in building a robust risk assessment and management framework, with our help the policy of your organization will be precise enough to safeguard the future challenges and risks in advance.

IT and Cyber security management support

Japan's regulatory policies are very particular about consumer protection, and any infringement arising out of data breaches or cyberattacks attracts heavy penalties. The damage is not just till fulfilling the penalty, but the conservative outlook of the society leads to defamation and, ultimately, the deterioration in the business of the fintech industry. You can safeguard yourself from this risk with our help. Our team of legal analysts will formulate robust cybersecurity databases for you, and our information technology team will assist in making these databases in line with the global trend.

Necessary paperation, Drafting, and AOA support

The Japanese licensing system involves a tiresome and lengthy process where almost all the mandates and necessary papers must be presented when applying for the license. Our team of experts will draft contacts, policies, procedures, and measures for you in compliance with the necessary criteria stated in the policies.

Planning, development & operations management support

Any new industry, when entering an entirely new market, needs assistance in planning where the headquarters will be, how the funds will be managed, and how to use the resources efficiently. It is necessary for an organization to have some support in managing these tasks, and our team at Enterslice will help you plan and develop your fintech industry right from its initiation.

Trade, tax, and additional permit registration support.

In Japan, it is essential that along with the license application, the trade-related policies, the receipt of taxes paid, the paid-up capital-related necessary papers, and other permits that are necessary for a fintech industry to exist in Japan are attached, non-fulfilment of which leads to delay in the grant of fintech license. Our team of experts will help you procure these additional supporting necessary papers that are important for your license application.

Enterslice Licensing Services

Necessary paperation Assistance- Our fintech experts offer easy and hassle-free Paper works guidance with checklists along with updated formats from time to time.

Compliance Support- establishing a cross-border fintech industry involves multiple compliances, which, when not followed in a proper pattern, cause delays in the licensing process. Our legal team will help you in systematic compliance formulation along with time-to-time compliance support as per the changes in the regulation.

Expert Guidance- We customize fintech strategies as per your company's business model. To achieve the same, we assign a dedicated fintech expert who will provide expert guidance and support and help you make the right decisions for your company.

Evolution & Growth of Fintech in Japan

The three major nations that have monopolies in financial technology-oriented businesses are China, the US, and the UK. There is hardly any financial sector untouched by the buzzword of Fintech. Although Japan has a favourable environment, infrastructure, and population of 130 million, its fintech industry is still evolving because of years of inflexible financial infrastructure.

But in recent years, Japan has shown major improvement and strong growth potential as a fintech market, and the government of Japan, in 'Japan Revitalization Strategy 2016, designated the fintech sector to be one of the most promising growth areas and since then to make this a reality, major initiative by the government in the form of amendment of banking Act in which the banks were motivated to establish subsidiaries which are related to information & technology.

In 2017, japan included cryptocurrency into its legislative framework by amending the "Act on Settlements of Funds", also known as the "Cryptocurrency Act". This Act permitted cryptocurrencies as a form of payment in Japan.

The central government and metropolitan government both acknowledge the need for fintech industries and their contribution to the growth of a country's financial framework. To ensure the same, the Japan Financial Services Agency (FSA) and the TMG Tokyo Metropolitan Government (TMG) have dedicated teams to attract foreign financial services companies interested in expanding their business to Japan.

Status Of Cross-Border Companies In Japan’s Fintech Market

General mandates

Cross-border companies are not restricted from owning shares or equity in fintech businesses, and the only mandate is the fintech companies need to submit a report to the authorities through the Bank of Japan by the Foreign Exchange and Foreign Trade Act. A similar case is the one with foreign fintech companies establishing their business in Japan; they can do this only after obtaining a license. After attaining the license, Fintech can provide any financial services, including banking, insurance companies, fund transfer service providers, crypto asset exchanges, and EPI transaction businesses.

The general rule while applying for a license in Japan is that the company obtaining the license must be governed by the laws of Japan. The individual who is establishing his licensing firm must be a resident of Japan,. Still, these conditions don't apply entirely to the foreign companies, these companies can procure Type I and Type II financial instruments business operators, investment management service operators, investment advisers and agents, third party prepaid payment instrument issuers, acquirers and PSPs.

Initiatives by Japan Government for Cross-Border Financial Markets

  • The tax policies about corporate, inheritance, and income tax were revised and clarified.
  • Procedures for introduction to the market were simplified, and the policy for English service was introduced, which made the application and registration procedure easy for the new entrants.
  • The immigration measures were amended, making a clause for temporary visitors to commence the business.
  • Free company setup support and livelihood support for international school hunting, medical matters, and housing.
  • A dedicated website for information related to collective share-related policy measures.

Overview of the Japanese Fintech Market

Japan is one of the largest economies in the world. Although the fintech ecosystem of Japan is comparatively newer than the rest of the world, the pace with which it is growing provides a great opportunity for fintech startups to enter the Japanese market. Japan is one such nation that has a flexible and supportive environment for foreign fintech companies, which is why it is important to understand the regulations with the help of which fintech licenses could be procured, types of licenses for the different types of financial businesses, the challenges that an organization faces while establishing its fintech business in japan, the benefits of establishing a fintech business in japan and how Enterslice will help you in operating as a licensed fintech industry in a market which has world's largest consumer base.

Fragments of Japan’s fintech regulations

The license regulations in Japan are divided into fragments. The first layer is for the products and services, such as banking, insurance, settlement, and remittance, and this license is designed for providing products and services.

The second layer is for sales and marketing, where licenses for selling and marketing and its corresponding products and services are given.

The third layer is an infrastructural layer where the regulations are for money laundering and personal information protection.

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Regulatory Framework for Licensing in Japan

Financial service authority

FSA is the authority that supervises licenses for Fintech in Japan and PSA, i.e. the Payment Services Act (PSA) establishes the regulatory framework for issuers of prepaid payment instruments, including 'electronic money', non-bank providers of funds transfer services and central counterparties for funds transfer transactions.

Payment services Act

The vision behind the adoption of PSA was to open up markets to non-bank payment service providers in Japan. The PSA Act specifies in detail the types of financial services existing in the market and the criteria for their licensing.

Financial Instruments and Exchange Act

In 2006, the Securities and Exchange Act was amended, the Financial Instruments and Exchange Act was amended, and the Financial Instruments and Exchange Act came into existence. This Act aims to respond to the changes that surround the financial and capital markets, promote full compliance with investor protection rules, improve investor convenience, ensure market functions and adapt to the internationalization of the financial and capital markets.

Investment-based financial company license in Japan

Licenses for Asset Management Business

These types of licenses include businesses such as

  • Investment advisory and agency business
  • Investment management business
  • Type 1 and Type 2 financial instruments businesses are about selling fund interests and other types of securities.
  • Specially permitted businesses for qualified institutional investors, i.e. to sell fund interests to manage the assets of professional investors only.
  • Investment management business for qualified investors for managing the assets of professional investors only.
  • Specially permitted businesses for overseas investors to sell fund interests to overseas investors and manage customer assets.
  • Specially permitted business during the transition period to conduct an investment management business, i.e. already conducted overseas also for overseas Investors, etc., in Japan

Investment Advisory and Agency Business-Related License

Services involving investment advisory and agency or intermediary for the conclusion of an investment advisory contract.

Investment Management Business-Related License

  • Services involving investment corporation asset management business
  • Discretionary investment business
  • Investment trust management business
  • Fund management business

Financial instruments-based service license

Type 1 Financial Instruments Business License

  • Business about the sale and purchase of securities, intermediation, brokerage
  • Agency for the sale and purchase of securities
  • Intermediation, brokerage, or agency for entrustment of sale and purchase listed securities or market derivatives transactions.
  • Secondary distribution of securities
  • Handling of public offering, secondary distribution, or private placement of securities
  • Over-the-counter derivatives transactions
  • Operation of a proprietary trading system
  • Underwriting of securities
  • Accepting deposits of cash or securities

Type 2 Financial Instruments Business License

  • Activities in the course of business, such as trust beneficiary interests, membership rights of a limited partnership company, and interests in collective investment schemes, include businesses involved in
  • Purchase and sale of securities
  • Intermediation, brokerage, or agency for entrustment of market derivatives transactions
  • Secondary distribution of securities
  • Handling of public offering, secondary distribution, or private placement of securities; or
  • public offering or private placement (self-offering) of certain types of securities, such as beneficiary
  • Certificates of investment trusts managed by the investment Management Company or interests
  • Collective investment schemes are managed by themselves as the general partner of an investment trust.

Specially Permitted Businesses For Qualified Institutional Investors License

  • Permitted Businesses for Qualified Institutional Investors, etc., may be used
  • For the sale of interests in a collective investment scheme to companies of or larger than a certain size and High-net-worth individuals but may not be used for sale to the general public
  • To conduct private placement (self-offering) of a partnership-type fund of which Japanese investors
  • Must comprise one or more "Qualified Institutional Investors" and 49 or fewer "Eligible Investors" (collectively, referred to as "Qualified Institutional Investors, etc.) as counterparties or
  • To conduct fund management of cash invested or contributed solely from Qualified Institutional Investors, etc., and
  • No investor is a disqualified investor, and any other statutory requirements under FIEA and Cabinet Office Order are met.

Investment Management Business For Qualified Investors License

  • Registration requirements are more relaxed than those for an Investment Management Business under certain conditions.
  • The minimum capital required, which is normally set at 50 million yen, is 10 million yen as long as the right holders are limited to "Qualified Investors" and the total amount of the investment assets under Management is limited to 20 billion yen or less.
  • When a registered Investment Management Business Operator for Qualified Investors solicits Investments exclusively from Qualified Investors by way of private placement (handling of private placement)For acquisition of beneficiary certificates of investment trusts or investment securities of investment Corporation that it manages with complete management authority under a discretionary investment contract,
  • It may do so with registration as a Type 2 Financial Instruments Business instead of a Type 1 Financial Instruments Business.

Benefits of Fintech Licensing In Japan

Large Deposit Base

Japan is the 3rd largest economy in the world, and the landscape of its market is expected to grow from $3.2 Billion to $ 11 billion. This largest economy also comes with the largest population, which could be the largest depositor base for the fintech industries.

Legacy Financial IT Systems

This is a blessing in disguise, meaning the legacy financial IT systems are built on the core banking model, which creates barriers to new initiatives. The current scenario is that the government knows that a very robust IT system is needed for such a growing economy; hence, the fintech industries have a very bright opportunity to partner with the existing institutions.

Open Banking Approach

Japan has seen a vast increase in collaboration between national and regional partners and partnerships between banks without building API portals. This is a huge opportunity for the newly formed fintech startups to adopt open banking, collaborate, and approach the existing players.

Crowdfunding

The crowdfunding ecosystem saw a steep growth of 157% between the years 2016 and 2022, peer-to-peer loans and funding for goods and services from where the majority of the crowdfunding comes from, making it a beneficial sight for the fintech startups.

Enriched and Diversified Fintech Ecosystem of Japan

The fintech landscape of Japan is full of opportunities, and organizations such as the Consortium for Japan International Asset Management Center Promotion (JIAM) is a non-profit organization with a vision to develop, nurture, and diversify the ecosystem of financial businesses so that investment management can be aided. This organization conducts workshops on asset management and Fintech, seminars, and webinars on data management with investment professionals who are leaders in creating market opportunities. Similarly, another organization named Tokyo Metropolitan Government (TMG) is an active organization that offers free support services to companies looking to expand in Tokyo. The domain in which the organization works is investment, building networks, developing a launch and growth strategy, and answering legal, tax, and immigration questions. These organizations enrich the community with their presence and propagate the landscape of Fintech in the market, making it possible for new entrants to make use of existing opportunities as well as create new ones.

Our success story

We have 10+ years of experience in the fintech domain, along with licensing, company establishment, and other legal compliances. Our journey is full of success stories that we achieved through these years by making the right decisions for a budding or an established fintech business in Australia.

Our commitment to you

Goal-based outcomes

At Enterslice, we value our clients' time and resources. Therefore, to achieve the same, we derive goal-based strategies to streamline our operations.

Consistency

We have a dedicated team of experts who know how to remain committed and objective, along with the skill to make a business settled.

Balanced approach

We aim to achieve the right balance for our clients' businesses, especially when it concerns the fintech industry.

Specially permitted financial services license

Specially Permitted Businesses for Overseas Investors License

The Specially Permitted Businesses for Overseas Investors, etc. is a system under which registration for an Investment Management Business or Type 2 Financial Instrument Business (self-offering, etc.) is not required for the Management of partnership-type funds with equity investors who are overseas investors, etc. (limited to cases where 50% or more of such equity has been invested by non-residents), offering or private placement of partnership-type fund interests to overseas investors, At a place of business or office established in Japan.

Transitional Period Specially Permitted Business License

It is a system of business under type 1 financial instrument business. It refers to foreign corporations or individuals domiciled in a foreign country having net assets of 300 million yen or more, investment financial assets of 300 million yen or more, and a securities/derivatives account that was opened at least one year ago.

Licenses Related To Fintech Business

AREAS OF FINTECH

TYPE OF LICENSE

Instant payment: remittance service (exchange transactions)

Funds transfer service

Payment by prepaid card

Prepaid payment instrument (for own/or for third party business)

Services provided through the use of open APIs

Electronic Payment services

Robo-advisor

Investment advisory business/investment management business

crowdfunding

The small amount of electronic public offering service

Security tokens

Financial instruments businesses

Transaction lending

Money lending business

Intermediary services with banks, securities companies, insurance companies etc.

Financial services intermediary business

Crypto asset trading

Crypto assets exchange business

Stablecoins

Electronic payments instruments

Insurance

Insurance business

Credit card issuance

Registered(small-amount) comprehensive credit purchase intermediary

Merchant management and payment agent

Nosiness operator, which concludes contracts to process credit card numbers.

Why choose us

Vision & core values

Your trust is what we have faith in, and we can do anything to keep your trust intact. We engage the community without staking our core values and vision.

Customer-centric services

We understand that the core of any business is its employees. Our team of experts is polite and competitive and responds efficiently to each customer's queries. Our belief is to develop long-term and trustworthy relationships.

Convenient and consistent

We provide our clients with an environment that is convenient and consistent for them. We work without friction and with the ties of trust and credibility.

Reputed & trustworthy

If you go by word of mouth, then all our clients give positive feedback for our services, making us a reputed and trust worthy organization.

Frequently Asked Questions

Fintech licensing is the license given to those financial institutions that are using technology to provide financial services. This license makes the existence of an industry legal in the territory of Japan.

A fintech license makes the existence of an entity legal in the marketplace. A legal entity can enjoy all the perks and relaxations formulated by the government. It can operate in the marketplace without any fear and make partnerships and other business decisions on its own.

FSA is the authority that makes all the rules and regulations regarding the procedure of obtaining a license in Japan. The established procedure is instated in the Payments and Services Act (PSA), in which all the guidelines about the application for a license and its requirements are stated.

The Payment Services Act is the key regulation governing Japan's fintech licensing.

With the help of our advisory, you can make wise decisions for your fintech industry. We have a skilled and expert team that will help you right from the Paper works of your licensing process to making you compliance-ready. Our services are not only limited to making you a license holder but also to making you a known name in the fintech industry of Japan.

Following are the types of licenses available for different fintech services in Japan.

·  Funds transfer service license

·  Prepaid payment instrument (for own/or for third party business) license

· Electronic Payment services license

·  Investment advisory business/investment management business license

·  The small amount of electronic public offering service license

· Financial instruments businesses license

· Money lending business license

· Financial services intermediary business license

· Crypto assets exchange business license

· Electronic payment instruments license

·  Insurance business license

·  Registered(small-amount) comprehensive credit purchase intermediary license

·  Nosiness operator which concludes contracts to process credit card numbers license

A fintech organization applying for a license in Japan needs an extensive Paper works procedure. A foreign fintech needs to register the tradename of the business and then needs to attach the necessary papers about annual income, funding, board of members and directors, permits, and related necessary papers.

If a fintech industry fulfils all the criteria and necessary papers needed for a fintech license, then the authorities take around three months to grant the license. However, if the necessary papers are not proper and insufficient, it can cause a delay of 12 months for the grant of a license.

The Financial Services Agency (FSA) is a charged regulatory authority that inspects and supervises financial institutions and their businesses in Japan. Any necessary law needed in the finance sector is to be formed by the FSA.

With the help of Enterslice, you can have a hassle-free fintech license application process. We can help in building your industry, and our team can formulate necessary papers and create a fundamental structure for your team to work upon, which can streamline your journey to fintech licensing in Japan.

The interpretation of Japanese laws is sometimes a task for a foreign company. Along with this, the approach of the Japanese consumers and the regulators is quite conservative, making it difficult for a fintech industry to penetrate the target audience and make a profit out of the consumers.

We have an experienced team of legal drafters who have years of experience in drafting license applications of globally powerful fintech models. We can accurately build your application in a manner that no delay in the grant of license occurs by any chance.

No, the current Japanese market is very welcoming to foreign companies. The pro-innovation approach of the government is making it easier for industries to trust the markets of the world's third-largest economy.

The fintech market of Japan is currently observing a progressive increase and is continuously changing because it includes the possible new trends of the market into its ambit, which is why the frequency of changes taking place in the fintech market of Japan is high.

Yes, we can assist you in renewing your fintech license. We can also design the entire Paper works process so you can make an impactful renewal license application.

The FinTech licensing requirements are flexible in comparison to those of any other nation. The market is open and welcoming to new foreign entrants, and the government is supportive of its formation.

Yes, we have an expert team that can help you in partnering with already existing firms in Japan. We are also in regular touch with the legacy partnership firms and will connect you with those for collaboration.

From time to time, FSA publishes a rulebook on the changing dynamics of the fintech market. This is the link through which you can get the knowledge of the fintech regulations of Japan https://www.seisakukikaku.metro.tokyo.lg.jp/pgs/gfct/business-and-living/guidebook-digital/#page=1.

Knowledge of the local market and consumer base is very important for a fintech licensing process, and this knowledge makes it easy for a consumer to penetrate the market effectively.

Yes, our team can help you establish collaboration with the legacy fintechs of Japan, along with helping you transfer and acquire the licenses.

Japan is an economically successful market and has a very large consumer base. Any product that is formulated carefully and with precision and by linking the population will be effectively successful in the Japanese market.

We have strict non-disclosure policies, our contract managers are very particular about making policies that involve data-related safety measures, and our policies for confidential information will provide you with a secure environment of advisory and consultation with us.

We partner with more than 100+ companies

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