Embedded Wealth in Japan: Finally the Mountain Moves

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24 July 2022

The Country of Risk Averse Is Shifting to Periodical and Continuous Investment


Investment Culture Has Rooted in Japan, However Spread of Open APIs Is Slower than Expected

In Japan, a country with a large amount of personal financial assets, an increasing number of young people have started investing due to concerns about future pensions and other factors. This is driven in part by policy support and a boost from the points ecosystem, mainly from Electronic Commerce and telecom companies.

However, because of the slower pace of API proliferation in Japan, embedded finance has been slow to spread—and there are few options for individual investors in the embedded wealth field now.

Now It’s Just Before the Dawn of Embedded Wealth

We do see various developments, especially in the field of embedded wealth.

In wealth management, Rakuten, the point ecosystem leader, has succeeded in acquiring periodical and continuous entry level investors in its ecosystem. Additionally, licensed enablers are providing Backend-as-a-Service for investment services to consumer brands and others, while major life insurer has entered the asset management market by utilizing BaaS.

Toward the Democratization of Wealth Through the Further Spread of Embedded Wealth

Looking ahead, will Japanese retail investors enjoy the same wide range of products and services as in the US? In Japan, the various elements of Wealth-as-a-Service are not yet broadly available in the embedded wealth management field.

We look forward to supporting further innovation in these areas and the democratization of wealth through the further spread of embedded wealth.