Rapidly Accelerating Fintech and Future Financial Services

[Fujitsu Forum 2016 Event Report]

Fujitsu Forum 2016, a two-day event, was held on May 19 and 20 at the Tokyo International Forum in Yurakucho, Tokyo. On May 19, Fujitsu held a two-part conference entitled "Rapidly Accelerating Fintech and Future Financial Services."

[Part 1] Changes in Financial Services Brought by Fintech

The Current Fintech in Realization Phase and Fujitsu's Initiatives

In the first half of Part 1, Izumi Nagahori, Corporate SVP, Fujitsu Research Institute, talked about the current state of Fintech as well as Fujitsu's initiatives under the theme of "The Current Fintech in Realization Phase and Fujitsu's Initiatives."

The digital transformation has driven great changes in financial services. Given Fintech's rapid acceleration, Mr. Nagahori noted that, "Fintech is not just a fad. It should be regarded as a new trend that has resulted from the evolution of ICT. Various start-up companies* are redefining finance from the user's perspective."

Some Fintech start-ups that aim for global development have appeared in Japan as well. The Ministry of Economy, Trade and Industry and the Financial Services Agency are taking initiatives to ease restrictions. Mr. Nagahori pointed out the following: "Easing restrictions is the key point to promote innovation in the future." He presented two overseas case studies, one on Robot Adviser*** of UBS** and the other on the establishment of a new professional organization by the Monetary Authority of Singapore.

Mr. Nagahori also introduced the current situation of start-ups armed with Fintech that are attempting to accelerate innovation. "Fujitsu has also started initiatives to realize unique Fintech services using artificial intelligence (AI) and the blockchain****," he explained.

*: Companies that have satisfied the three requirements of social value, social transformation, and establishment of a business model. In Japan, the term "start-up company" (or start-up) is used as a synonym of "venture company."
**: One of the world's leading financial holding companies based in Switzerland.
***: An asset management service which automatically provides tailored investment allocation services by answering only a few questions.
****: A technology for reaching credible agreements through network authentication by distributing data to computers around the world.

Fukuoka Financial Group's Initiatives

In the second half of Part 1, Kenichi Nagayoshi, Assistant General Manager, Sales Planning Division, Fukuoka Financial Group, Inc. (FFG) (iBank Marketing CEO) took the podium and presented a regional initiative for Fintech entitled "iBank, a New Financial Service Platform Using Smartphones."

FFG started implementing its Fifth Mid-Term Management Plan in April 2016 under the slogan of "Aiming to be the Best Regional Bank." Mr. Nagayoshi explained FFG's new venture support initiative carried out through investments and loans: FFG established the "Fukuoka Technology Partners" and started an "iBank" project as the first investment project using this scheme.

iBank is a smartphone-based financial service platform that, based on users' lifestyles, seamlessly provides various financial services, including savings management, provision of consumer information, and settlement and loan services. Mr. Nagayoshi explained that "most conventional financial products and services were created from the 'viewpoint of banks,' but iBank provides new money services from the 'viewpoint of customers' as service users."

iBank offers settlement services linked to a debit card as well as functions to support design and implementation of financial plans for life events, such as marriage and purchasing a home. Also, iBank offers a function called "Goal Deposit" that allows users to manage their deposits based on specific purposes. Mr. Nagayoshi demonstrated some mechanisms of the service as he introduced them. For example, if a customer selects and registers a purpose such as "travel" or "education," the deposit amount required to reach the set goal is visualized. Also, customers can obtain and use coupons by performing simple smartphone operations.

Lastly, Mr. Nagayoshi concluded his presentation with the following remark: "iBank services will launch in late July 2016. Fukuoka Financial Group will strive to build an ecosystem in collaboration with our various business partners in the region."

[Part 2] Future Financial Systems Proposed by Fujitsu

In Part 2, Ryuji Tokita, SVP, Fujitsu took the podium. Under the title of "New Financial Solution Services that Accelerate Digital Transformation," Mr. Tokita presented Finplex, a new solution system launched by Fujitsu, the first such new system in 10 years.

Financial solution Finplex

Finplex is a new financial solution system based on Fujitsu's MetaArc digital business platform. Finplex supports the innovation of financial institution customers by combining Systems of Record (SoR) as conventional information systems with Systems of Engagement (SoE) that support digital transformation.

Mr. Tokita explained as follows: "Toward the realization of customers' digital transformations, Fujitsu will provide co-creation program services and co-creation places." Fujitsu's co-creation facilities include the FUJITSU Knowledge Integration Base PLY in Kamata (Tokyo), which opened on May 23, 2016, and the HAB-YU platform in Roppongi (Tokyo), TechShop Japan in Akasaka (Tokyo), and the Innovation & Future Center in Minato Mirai (Yokohama).

"Fujitsu has also established a campus in Sunnyvale in Silicon Valley as a meeting place for industry-leading start-ups. We will support 'digital transformation' through co-creation by combining the knowledge of Fujitsu, our customer companies, and partners," Mr. Tokita said as he concluded his presentation.

Presenters
  • Izumi Nagahori
    Corporate SVP
    Fujitsu Research Institute

  • Kenichi Nagayoshi
    Assistant General Manager
    Sales Planning Division
    Fukuoka Financial Group, Inc.

  • Ryuji Tokita
    SVP
    Fujitsu Limited

From Fintech to Gaze Tracking: Exhibitions Incorporating State-of-the-art Technologies

In the exhibition hall, Fujitsu demonstrated many of the financial solutions presented at the conference, including the Finplex financial solution system, UI/UIX that provides convenience and entertainment, Omni-Channel for smooth collaboration with multiple channels, Smart Sales for improving sales representatives' capabilities and efficiency, and Analytics for deepening customer insights.

Fintech practices in the digital transformation era

Explaining Fintech practices for employee services

As a premium member of the development community for blockchain technology, Fujitsu introduced its deep commitment to making such technology available to the public. Fujitsu exhibited a variety of its finance-related technologies, such as an API***** designed to promote mobile app development, an app for insurance salespeople to effectively make use of devices, and loiterer detection services in combination with IoT devices.

Fujitsu also introduced a case study of Nanto Bank, which was the first Japanese regional bank to use mBaaS******. Nanto Bank employs the mBaaS open platform, which is the only domestic platform that complies with the Security Guidelines issued by the Center for Financial Industry Information Systems (FISC). This has allowed the bank to reduce development and operations costs by up to 70% and to speed up its development process by as much as 80%.

In addition to the above, Fujitsu introduced examples of internal usage of Fintech applications by Fujitsu employees, FIDO authentication for individuals and devices using a biometric authentication technique, and a technology for automatically masking sensitive data when taking such data outside the company.

*****: This abbreviation of "Application Programming Interface" refers to the commands, rules, and functions used during programming.
******: Mobile Backend as a Service is a service that provides frequently used versatile functions for smartphone apps from the cloud.

Regional digital coupons linked through APIs

At the regional digital coupon exhibition booth, Fujitsu staff members explained that a mechanism for regional digital coupons can be built speedily and easily by using business APIs necessary for co-creation by local governments and regional banks as well as companies that are working to revitalize local communities. Compared to conventional paper coupons, this system offers great benefits for users, participating stores, coupon-issuing regional banks, and local governments.

When building a mechanism for regional digital coupons, data must be linked and shared across different types of businesses and industries, such as local governments, regional banks, regional companies, and regional commerce and industry communities. Use of an API makes it easy to realize linkage and share data among different industries.

API used for regional digital coupons

The regional digital coupon service integrates conventional financial services with digital coupons, mobile settlement, gift tickets, personal finance, and regional coupon services.

Strengthening contact with customers using AI

Detecting the gaze of a customer standing in front of an ATM to assist in ATM operation

This is a demo of an ATM that employs a gaze-tracking sensor. The user-friendly system detects if the customer is confused about how to use the ATM with the gaze-tracking sensor and then calls a bank employee to help. The customer can thus receive assistance even without pressing the call button.