Japanese Convenience Store to Challenge Traditional Banking

Lawson outlet,Tokyo

Lawson outlet,Tokyo

Already under pressure from growing financial technology innovations the banking industry in Japan might face another challenge from the ubiquitous convenience store group Lawson.

According to a report in Japanese publication Yomiuri Shimbun, the third-largest convenience store chain in the country in terms of the number of stores, plans to apply for a banking license from the Financial Services Agency.

Lawson will likely hold an equity stake of 95 percent in the new bank while Bank of Tokyo-Mitsubishi UFJ will hold 5 percent, the sources told the publication. The company aims to boost the number of its customers and its sales through improved financial services.

Lawson currently has 11,000 automated teller machines in its stores nationwide, allowing customers to make withdrawals from banks with which it has tie-ups. After entering the banking sector, it plans to start such new businesses as deposits for individual customers and credit cards. The company will also aim to increase the number of its partner financial institutions, including regional banks. There are currently about 80.

Ambition Unconvincingly Denied 

In addition, Lawson is considering giving a discount for items available at its stores or making fees for using Bank of Tokyo-Mitsubishi UFJ’s services at in-store ATMs free for customers who open accounts at the new bank. It also plans to offer points in Ponta electronic money that can be used in its stores when customers make deposits or withdrawals at its ATMs.

In Japan banks affiliated with major retailers such as Seven Bank, which is under the umbrella of Seven & i Holdings, and Aeon Group’s Aeon Bank have been achieving solid results, taking advantage of the strong ability of affiliated convenience stores and general merchandise stores.

However in a press release Lawson denied the reports saying no decision has been made at this point in time.

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