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Movie 1
Masato Kaneda
Mizuho Financial Group
For Discussion Purpose Only
Copyright (c) Mizuho Financial Group, Inc. All Rights Reserved.
Strictly Confidential
3
The Appeal of FinTech
I think that banking services
are all the same
I would prefer visiting the dentist to
going to the bank to get information
I think banks are no longer
necessary
53%
71%
33%
I believe FinTech ventures are likely to
change how banking works
I’m interested in receiving financial services
from Google, Amazon, Apple, Paypal, and
Square rather than existing banks
50%
73%
Views of the Millenial Generation (US)
I think it’s possible that loan
officers’ position will be replaced
by AI within 10 years
“The Future of Employment :
How Susceptible are Jobs to Computerization?”
90%
（出所）”Millennial Disruption Index” Viacom Scratch及びオックスフォード大学資料より、みずほ銀行産業調査部作成
For Discussion Purpose Only
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4
Possibility of FinTech Being Comparable to the Industrial Revolution
（出所）”Millennial Disruption Index” Viacom Scratch及びオックスフォード大学資料より、みずほ銀行産業調査部作成
Excerpt from JP Morgan CEO Jamie Dimon’s Shareholder Letter (2015/4/8)
Silicon Valley is coming.
There are hundreds of startups with a lot of brains and money working on various alternatives to
traditional banking.
They are very good at reducing the “pain points” in that they can make loans in minutes, which
might take banks weeks.
“While we have yet to fully understand what will happen, we do know that the
financial sector is clearly headed for major changes and that the pace of change
is accelerating.”
Japanese Bankers Association, Chairman Sato (April 2015)
Expressed a strong sense of crisis in an interview with Nikkei that “banking business is
facing a serious challenge from other industries”
For Discussion Purpose Only
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5
FinTech: Market Size
Finance is anticipated to be the fourth largest area in terms of economic value from the Internet
of Things (IoT)
Investments in FinTech expected to increase substantially, particularly in Asia
Increase in investments in FinTech (estimated)
(出所) Market Research.com “Five Banking Innovation From Five Continents : USA, Europe, Asia, Africa Australia”より、みずほ銀行産業調査部作成
Economic added value from IoT by Sector （2013-2020 / Global Scale）
(出所) McKinseyレポートより、みずほ銀行産業調査部作成
(100 million US$)
Outlook 4.6
3.9
2.3
1.3
1
0.9
0.86
0.6
0.2
公共サービス等
ものづくり革新
流通・小売・物流
金融
医療・健康
スマートハウス・コミュニティ、エネル…
教育サービス
メディア・コンテンツ
農業
(trillion US$)
Public services
Manufacturing innovations
Distribution, retail, logistics
Financial services
Medical/health
Smart house/community, energy
infrastructure
Educational services
Media and online content
Agriculture 0
125
250
375
500
2008 2011 2014 2017 2020
豪州
アフリカ
アジア
欧州
Australia Africa Asia Europe US
For Discussion Purpose Only
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6
Outline of FinTech: Expand Range of Financial Products and Services
（出所）みずほ銀行産業調査部作成
Tech
Digital
Internet
Cloud
Mobile
Big Data
Block Chain
Big Data
Devices
Server
PC
Smart Phone
Wearable
E-Commerce Non-banks Financial Orgs
Closed System Open System
Net Banking
口座振替
ATM
店頭対面サービス
デビットカード
BID COIN
ロボアドバイザー
Social Lending
P2Pレンディング
個人間決済
P2P海外送金
Digital Wallet
クラウド会計
電子マネー
EC向決済
個人向ローン
クレジットカード
ID決済
EC決済
Cloud Funding
スマホカード決済
Service Providers
IT Infrastructure
Bitcoin
Robo-advisor
Social Lending
P2P Lending
P2P Int’l Tranfer
Digital Wallet
Cloud Accting
Retail Payment
Mobile Payment
Cloud Funding
Debit Card
E-Money
EC Payment
Personal Loan
Credit Card
Net Banking
ATM
Auto-Pay
Services at Counter
ID Payment
EC Payment
For Discussion Purpose Only
Copyright (c) Mizuho Financial Group, Inc. All Rights Reserved.
Strictly Confidential Approaches to FinTech
Actively Promote New Technologies
Operational Areas
Big Data AI Block Chain
Leverage Cutting-Edge Technologies
Robotics
Infrastructure
VCs・ FinTechs
Advisory
Committee
Research
Centers
Incubation Project Team
Chief Digital Innovation Officer
Promote Business Innovations in Each
Company
Companies
Capitalize on External Resources
7
Payments
Asset Management Investment Advice
Financial Infrastructure
Optimization
Asset Management
Financial Info
Other Financial Services
Current Areas
Crowdfunding
Lending
Future Areas
Transactional History
R3 Consortium
SMART FOLIO
Account Info on Line MoneyForward Cloud Invoicing
Data Exchange Consortium
Pepper Robo-Concierge
Cross-functional Team Works
Independently Across Company
Launched new services across multiple operational areas and alpha/beta tested
Continue to develop new projects currently under consideration
For Discussion Purpose Only
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8
（出所）みずほフィナンシャルグループ インキュベーションPT作成
Company-wide initiative to bring together key internal and
external players to develop innovative new business models
Team Composition: Cross-functional group
of specialists with diverse backgrounds and
expertise
External players: Major IT vendors, fintechs, VCs,
research Institutions
Internal players: IT specialists, traders, data
scientists, and area specialists in: transaction
banking, channel strategy, retail banking and
venture business investments
The Role of the Incubation Project Team
For Discussion Purpose Only
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※投資信託は預金・金融債・保険契約ではないため、預金保険・保険契約者保護機構の対象ではありません。 投資信託は、基準価額の下落により損失が生じ、投資元金を割り込む可能性があります。またお客さまにご負担いただく手数料があります。
9
Mizuho’s Approach to FinTech: Asset Management
Offer online asset/investment portfolio according to customers’ needs —
their life stage and risk profile — using cutting-edge IT tech investment theory
Key Characteristics
- Advise on investment approaches used by
financial professionals
- Propose investment opportunities for
customers’ mutual fund portfolio
- Advise on portfolio management from a
neutral perspective
- Maintain lower operating costs and high-
quality service
- Assess customers’ needs easily and at no
cost
For Discussion Purpose Only
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10
Mizuho’s Approach to FinTech: Asset Management
一生通帳閲覧パスワードを入力してください。
Collaborate with Moneytree to offer account information —
entire transaction history — via the Mizuho app on smartphones
For Discussion Purpose Only
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11
Mizuho’s Approach to FinTech: Payments
Display account information — balance and transactions —
just by using special stickers on Line
Balance Sticker Transaction Sticker
For Discussion Purpose Only
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12
MoneyForward’s cloud-based invoicing system MoneyForward’s payroll and payment services
Mizuho’s Approach to FinTech: Payments
Collaborate with MoneyForward to automate payment systems,
invoicing and payroll services for business customers
For Discussion Purpose Only
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13
Launch the proof of concept for Big Data applications by
collaborating with organizations from DXC
Data Exchange Consortium Role
Mizuho’s Approach to FinTech: Financial Information
Discuss the feasibility and efficacy of each
company's data collaboration.
Conduct research on commercialization in
sub-group meetings.
Analyze customers’ needs
using social media data Research best practices to
provide financial
services based on
needs analysis.
Verify efficacy
Data analyst
Data analyst
Platform Developer
Data recipient
For Discussion Purpose Only
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14
（出所）みずほフィナンシャルグループ インキュベーションPT作成
Mizuho’s Approach to FinTech: Financial Infrastructure
Leverage the resources offered by the “R3” Blockchain Consortium and test Proof of Concept by collaborating with SBI
- Lead the first project in Japan using the tech and know-how from R3 - Launch cross-border payment services using Ripple Connect, a next gen
payment system offered by Ripple
For Discussion Purpose Only
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Strictly Confidential
15
（出所）みずほフィナンシャルグループ インキュベーションPT作成
Mizuho’s Approach to FinTech: Financial Infrastructure
Collaborate with domestic and international vendors to test the feasibility of Blockchain and conduct separate POC/feasibility study
Partner POC
Cognizant Encryption and sharing of documentation and records for MFG
Microsoft, ISID, Currency Port
Syndicated loans
IBM Use of virtual currencies
Fujitsu Cross-border trading
For Discussion Purpose Only
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Strictly Confidential
16
Mizuho’s Approach to FinTech: Other Financial Services
（出所）みずほフィナンシャルグループ インキュベーションPT作成
FinTech Section of the Tokyo Station Branch
Enhancing the Customer Experience by harnessing the
potential of IBM’s Watson and “Pepper” the humanoid robot
For Discussion Purpose Only
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17
Mizuho’s Approach to FinTech: Open Innovation Events
【MIZUHO.HACK】Open Innovation!
For Discussion Purpose Only
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Strictly Confidential
For Discussion Purpose Only
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19
Mizuho’s Approach to FinTech: Developing VBs
Jointly conducting an Accelerator Program with NTT Data by utilizing NTT
Data’s assessment capabilities and network to develop new business models
with venture businesses around the world.
For Discussion Purpose Only
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20 19
Developing New Talent
Supporting Research
Supporting Education and Research through
the Support of the National Government
(METI)
Building a Hub for AI-related Innovation
Strengthening International Competitiveness
Collaborations with Industry and Academia in AI
Developing educational programs for cutting-edge AI research to become a globally competitive hub for AI-based innovation
For Discussion Purpose Only
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21
Mizuho’s Approach to FinTech: Call Center Enhancement
20
Mizuho has begun collaborating with Stanford University to test
voice-emotion recognition technology for its call center operations.
Operator
Voice-emotion recognition
system
Supervisor
Conversation
data Operator
support/advice
Customer
Situational
understandi
ng
Optimum
handling
For Discussion Purpose Only
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Strictly Confidential
22
Engagement with Venture Businesses
“The Incubator Lab”
A specialized program to support venture companies
through Investment, IPO solutions, and business consulting support
High-potential venture companies
Mizuho Capital Mizuho Bank Mizuho Securities Mizuho Trust Bank
Equity investment
Lending（specialized
credit rating team）
Business mediation
IPO consulting
M&A
Transfer agent
Securities related
consulting
The Incubator Lab University
Venture Capitals
Government agencies
Independent
administrative agencies
For Discussion Purpose Only
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Strictly Confidential
23
Mizuho’s Approach to FinTech: Investing in VCs
（出典：WiLおよびDraperホームページ。一部抜粋して掲載）
1) Act as a bridge to develop innovative services by investing in VC funds (WiL) and transferring staff to Silicon Valley
2) Form a private equity fund to invest in venture companies that possess cutting-edge financial technology
For Discussion Purpose Only
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Potential FinTechs for Mizuho
24
Contribution to income generation Contribution to lowering fixed costs
Legacy
Economic
Value
Large
Small
Utilization of
artificial
intelligence
On line Lending
Robo-advisory
Settlements
C2C/C2B/B2C/B2B
PFM
EC
settlements
Crowd Funding
Social Funding
（出所）みずほ銀行産業調査部作成
For Discussion Purpose Only
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Strictly Confidential
25
The Possibility of “Disruptive Innovation” in the Financial Sector
Weak
Strong
Communications
Retail
Music
Autos
Public
Banks
Fixed-line phones
50 million units
Mail-order market *2.7 trillion
yen
CD output 230 million
units
Gasoline only cars
57.99 million units
Public employees *4.35 million
Municipalities *3,234
Mobile phones 160 million units
EC market 6.5 trillion yen
Music distribution 180 million
times
Hybrid cars 4.71 million
units
Public Employees 3.38 million Municipalities *1,718
Self-Driving cars
Uber
E-government
(online services)
Legacy services?
Evolution of revolutionary
advances irrespective of formats and
industry frameworks
Disruptive
innovation
Disruptive
innovation
1990 2016 20XX
Regulations Publicity Safety
Advances in devices/tech and AI, Wider Internet smartphone usage, Storage and cloud services…
（出所）公開資料より、みずほ銀行産業調査部作成 （*）Mail-order market: 2001; Public employees: 2000, Municipalities: 1995 ⇒ 2014
ATM
150,000 units
CVS ATMs 50,000 units
For Discussion Purpose Only
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Strictly Confidential
26
Platform Strategy => Franchise Strategy in the Financial Sector
Franchise Deployment Platform Strategy
Pursue economies of scale through
sharing services and technologies
（出所）公開資料より、みずほ銀行産業調査部作成
Bank B
Bank C Bank A
Company D Venture E
Company F Venture G
Platform
Develop joint infrastructure and
share expertise on branch operations≫
Franchisee B
Franchisee A
Franchisee C
Franchisee D
Brand platform
Franchiser
Important to pursue economies of scale as a financial platform operator before other megabanks and
financial institutions to develop a new franchise-style of management in the financial sector
For Discussion Purpose Only
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Opportunity: The respective strengths and capacities of banks and FinTechs are complementary
Potential: The possibility for explosive growth with the right partnership
Building Alliances with FinTechs
Large customer base
Revolutionary customer experience
Low capital costs
Low operating costs
Core banking system
Employees possess in-depth experience in financial tasks
Technically strong staff
Utilization of new technologies
（出所）みずほ銀行産業調査部作成
Mega Banks
✔ ︎Extensive customer base
✔ ︎Long-term trust
✔ ︎Financial know-how
✖ ︎Revolutionary concepts
FinTechs
✔ ︎Revolutionary concepts
and technologies
✖ ︎Small customer base
✖ ︎Untested credit standing
✖ ︎Financial know-how
27
For Discussion Purpose Only
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Strictly Confidential
（出所）みずほ銀行産業調査部作成
28
Thank
You!
For more information, please contact:
For Discussion Purpose Only
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Copyright (c) Mizuho Financial Group, Inc. All Rights Reserved. 29
© 2016 Mizuho Financial Group Inc.
This document was created with the intent of discussion. The conditions herein are based on
assumptions, and we refrain from declaring the reliability or completeness of information
included in this document。
