LONDON, Aug. 26, 2016 /PRNewswire/ -- Financial technology or "fintech" is all the rage this year and the Bank of Japan (BOJ) says they will be looking to upgrade its operations to fall in line with developing systems.
Governor of the central bank, Haruhiko Kuroda, said the BOJ is a leading light in financial services, settlements and worldwide payment systems, and the technology upgrade is necessary for the bank to keep pace.
Fintech has several important operational implications for central banking and the Federal Reserve in the U.S. and the European Central Bank are just two examples of banks that have already incorporated elements of the tech into their systems.
"We are ready to take a chief role in researching and promoting the technology in Japan," said Kuroda at a recent financial seminar in Tokyo.
The idea of fintech is to allow financial institutions to utilize developing technology in order to streamline their economic activities and payment systems.
The Japanese have been slow to embrace recent developments in fintech, but are now looking to use the technology in order to unlock a vast amount of funds that private individuals are hoarding. Japan's ageing population is estimated to be sitting on upwards of 10 trillion yen.
"Japan has so much cash lying around doing nothing in the form of household savings," says Director of Asset Allocation at Orix Capital Trading, Steve Rogers. "It's in the BOJ's interests to try and help develop technology that will assist in freeing up that money for capital investment."
Many of the country's megabanks also see an opportunity to increase their revenues by utilizing fintech, and they will need to evolve and adapt their business models in order to get the best out of it.
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SOURCE Orix Capital Trading