Ripple Partner SBI Holdings Collabs With Japan's 2nd Largest Lender SFMG on Digital Banking

An agreement between the Sumitomo Mitsui Financial Group (SMFG) and SBI Holdings will see both entities collaborate to provide banking services on smartphones. SMFG, which is currently Japan’s second-largest lender by assets is expected to pump a significant investment towards SBI’s Neo Mobile securities. This venture is worth billions of yen and 20% of the stake will be owned by SFMG upon the acquisition scheduled for June 2020.

According to the publication on Nikkei newspaper, the deal involves millions of dollars and the first phase is expected to be complete this week. Notably, this precedes the Golden Week holiday in Japan.

Apart from the 20% stake acquisition in Neo Mobile securities, the SFMG is expected to pump and an additional $1 billion towards SBI holdings this year. The funds are to be directed in investments within 5G, Blockchain, and FinTech amongst other emerging technologies.

SBI holdings is likely to benefit from this investment given the capital to scale up its asset base. The firm has had close ties with XRP given its CEO, Yoshitaka Kitao, who sits in Ripple’s board. Such existing relationships coupled with new and stronger alliances with the likes of SFMG further places SBI ahead of its peers. While SFMG seems to be doing most of the heavy lifting with capital injection, the Japanese lender will undoubtedly increase its foothold in the emerging tech space.

These developments come amid a new regulatory framework for crypto firms operating within Japan. The country’s House of Reps updated the laws governing digital assets and crypto exchanges back in 2019. This was done through the Exchanges Act and Payment Services Act which are expected to take effect on May 1, 2020.

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Edwin Munyui
Edwin Munyui
Edwin is a FinTech enthusiast with a particular interest in blockchain technology and cryptocurrencies. He has worked as an author in the blockchain space since 2017 and enjoys creating content that both crypto veterans and newbies can understand. His simple writing style and financial market knowledge have made him a reputable fundamental and technical analyst with the ability to handle any topic around blockchain and crypto over the years.

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

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