Major Japanese financial organization, Sumitomo Mitsui Financial Group is collaborating with SBI Holdings to enhance its digital footprint in the country.
According to the latest reports, the Sumitomo Mitsui Financial Group (SMFG) is collaborating with SBI Holdings to introduce a digital banking system accessible from smartphones. This is a part of a multimillion-dollar agreement, that is expected to materialize bu next week.
The deal will provide SMFG with a 20% equity stake in SBI subsidiary Neomobile Securities, against which, it will give $1 billion to SBI. The fund will be used to invest in companies involved in digital technology in sectors like blockchain, fintech, and 5G. This deal is expected to help SMFG utilize SBI’s heavy footprint in the online trading space in Japan.
However, it will be pretty beneficial to both the entities, as SBi will be able to boost face-to-face consultations to its digital services, and SMFG stands a chance to ramp up its digital offerings. Moreover, SBI and SMFG are planning to establish their digital foothold in Japan, by collaborating with companies working in the digital space.
SBI has already partnered with local banks like Shimane Bank, Fukushima Bank, and Chikuho Bank. SBI is also looking forward to setting up a new company that will offer fintech and common system services to regional banks. SMFG is also investing in this venture, as a part of the latest deal.
SBI already has close ties with Ripple. So much so, that it plans to offer shareholder dividends in XRP tokens. In fact, SBI CEO, Yoshitaka Kitao is one of Ripple’s board of directors.
Crypto exchanges and firms in Japan are expected to face some regulatory hurdles in the near future, especially after the Japan House of Representatives have amended the Payment Services Act and Financial Instruments and Exchange Act to enforce stricter crypto regulations in the country. Both these acts are scheduled to take effect from May 1.