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The Second Meeting of FinTech Forum

January 2017
FinTech Center
Payment and Settlement Systems Department
Bank of Japan

Theme

Open Innovation in the Financial Services

Date

November 8, 2016

Executive Summary

The Bank of Japan held the second Meeting of the FinTech Forum on November 8, 2016. Its theme was "Open Innovation in the Financial Services".

Throughout the Forum, the participants shared the view that, with collaboration between financial institutions and FinTech companies, promoting open innovation is key to enhance added value of financial services. Since there are also various challenges regarding security issues in open innovation, FinTech industries felt it important to take measure to ensure security on their own initiatives. The participants also thought that it would be important to reform the "culture" of financial institutions so as to make full use of open innovation.

(1) Innovative Services Leveraging Open Innovation

As business application cases of open innovation to customer, financial institution, and FinTech companies, two start-up companies explained their new services such as providing APPs by third parties and facilitating new financial services combined with advertisement businesses. Another presenter illustrated the project of applying distributed ledger technology, which would encourage wider adoption of open innovation by variety of industries. In addition, a presentation was made to introduce an application of blockchain technology to provide benefits of enhance efficiency to both banks and their customers.

(2) Issues in Open Innovation

Regarding the open API as a form of open innovation, a presenter illustrated its potential benefit of improving the quality of financial services through encouraging new entry to the market and thereby enhancing competition. At the same time, this presenter also stressed the importance of taking necessary measures against the risks of cyber threats stemming from expansion of networks. Another presenter reported the efforts made by Fintech industries on their own initiatives toward ensuring securities. Many participants expressed the view that FinTech industries' efforts to ensure consistency between their security standards and the security guidelines of the financial institutions were meaningful and thus welcomed.

(3) Panel Discussion: Overcoming Challenges toward Open Innovation

The panelists shared the importance of open innovation for enhancing added value of financial services. They also raised various challenges to open innovation such as how to foster human resources suitable to open innovation, how to speed up decision-making in the organization of financial institutions, and how to protect users and information security by the efforts of FinTech companies. They shared the information about the efforts made by private entities and public sectors regarding establishing regulatory frameworks and security guidelines. As a summary of the discussion, the panelists expressed the views that 1) it would be important to enhance cooperation between banks and FinTech companies in order to promote open innovation, 2) it would be needed to improve payment and settlement infrastructure with a long-term perspective, and 3) it would be critical to have business strategies prioritizing users' needs.

Program

Opening Remarks

Creation of value added through open innovation
Shigehiro Kuwabara, Executive Director of the Bank of Japan

Presentations and Panel Discussion

Part 1 Innovative Services Leveraging Open Innovation

freee's Initiatives for Collaboration with Financial Institutions to Accelerate Open Innovation
Yasuhiro Kimura, VP of Government Relations, freee

Introduction of Automatic Saving Service "finbee"
Hiroki Maruyama, Director Fellow, NestEgg, Inc.

Hitachi's Initiatives for Open Innovation : Standardization of DLTs and Collaborations to Expand Customer Base With Banks
Toshiya Cho, Senior Vice President, Financial Innovation Center, Business Planning Unit, Financial Information Systems Sales Management Division, Hitachi, Ltd.

Part 2 Issues in Open Innovation

TPPs and Open API in Financial Sector : Issues on Cyber Security
Keisuke Nakamura, Deputy Director, Center for Information Technology Studies, Institute for Monetary and Economic Studies, Bank of Japan

Guideline to Secure Cyber Security
Takafumi Ochiai, Secretariat, FinTech Association Japan

Part3 Panel Discussion : Overcoming Challenges toward Open Innovation

Panels
  • Tomoaki Nakayama, General Manager, IT Innovation Dept., Sumitomo Mitsui Financial Group
  • Akira Toba, Senior Deputy General Manager, FinTech Business Promotion Office, Corporate Planning Division, The Chiba Bank, Ltd.
  • Hiroki Maruyama, Representative Director, FinTech Association Japan
  • Toshio Taki, Director, Money Forward, Inc.
  • Junichi Kanda, Director, Credit System Office, Planning and Coordination Bureau, Financial Services Agency, Government of Japan
Moderator
  • Naoyuki Iwashita, Head of FinTech Center, Deputy Director-General, Payment and Settlement Systems Department, Bank of Japan

Inquiries

FinTech Center, Payment and Settlement Systems Department

E-mail : post.fintech@boj.or.jp