Japan’s Mizuho Bank has a strong tech foundation, using which it is planning for a 10-year digital transformation:
Japanese bank Mizuho Bank is getting itself readied for a world that is 10 years from now. And in doing so, it is making use of its strengths in technology and its extreme understanding of its customers. The bank, an integrated retail and corporate banking unit of Mizuho Financial Group, and the third largest financial services company, applies its expertise in solving real world problems faced by society and customers, so that it can provide solutions that only it can, and create new value.
Makoto Umemiya, Deputy President & Senior Executive Officer, Group Chief Digital Innovation Officer and Group CFO at Mizuho Group, in an explanatory note on the Group’s website, had illustrated 3 points that are the bank’s strengths, which he expects, will enable the bank to establish a competitive advantage in digital transformation going forward:
1. The cutting-edge technologies and expert insights – including AI & IT implementation capabilities of group companies Mizuho Research & Technologies and Mizuho-DL Financial Technology
2. The Group’s robust business base with startup companies that have strong technological capabilities and with major companies that are advancing leading initiatives in various fields.
3. Its strategic partnership with Google in the digital transformation field and its other partnerships with tech companies for the development of new business.
HOUSE COIN, SPECIFIC TO AREAS
Towards this perceived transformation, one of the key initiatives has been the development of a new payment infrastructure that can be directly incorporated into services provided by companies and local governments in Japan. This is done with the aim of offering a comprehensive support for the digital transformation of payments and transfer services. For example, its House Coin is a reloadable coin service that enables payments only in a specific economic zone, such as a company’s own stores, or in specific regions under a local government. This is intended to speed up the shift to a cashless society and the bank hopes there will be many ‘house coins’ that can be used only within closed economic zones.
The bank is now using a tablet solution that enables customers to make deposits and withdrawals, complete bank transfers, open accounts, and change addresses directly from tablet PCs at branch offices. Developed by Mizuho Information and Research Institute in collaboration with Fujitsu and Banking Channel Solutions, the solution enables the bank’s new account system ‘MINORI’ to be connected directly online from a tablet and individual customers visiting the bank can complete transactions by simply inputting data into the tablet, without having to fill out an application form.
TIE-UP WITH GOOGLE
Recently, Mizuho Financial Group and Google Cloud concluded a strategic collaboration to accelerate the Group’s digital transformation and retail innovation strategy by enhancing operational capabilities, innovating across online and mobile channels and transforming the corporate culture. Under the collaboration, the bank is building a new digital marketing platform on Google Cloud that is integrated with Google Analytics. Google Cloud’s advanced data analytics technology will be used to generate real-time insights about customers’ preferences and anticipate their needs, and leverage a best-in-class AI technology to deliver hyper-personalized experiences.
Secondly, the bank is also building on Google Cloud to create new and advanced digital financial services offerings, such as banking-as-a-service, aiming to create and curate new digital products and services.
EXPLOITING UNSTRUCTURED DATA
Apart from this, the bank is using AI and ML to reduce costs for its existing business and to provide new solutions to its external users. It considers AI as a combination of data and machine learning and is initially trying to enhance the literacy and understanding of its employees in AI and data. Latest AI algorithms are being used to exploit unstructured data within the bank. This is mainly being done using image and video processing.
GETTING RID OF LEGACY
The bank has been modernizing its legacy banking system for international operations with Oracle. It intends to implement Oracle’s banking solutions to support critical functions, including direct deposit accounts and liquidity management, at its operations in major overseas offices. Oracle’s solutions are allowing the bank to have real-time processing support, a high level of STP for deposit operations and cash management services, and integrated postings between branches and subsidiaries for core banking operations.
The bank went live recently with Oracle Fusion Cloud Enterprise Resource Planning (ERP) to support financial processes in its New York accounting department. This will now be extended to Singapore and other global business centers.
Mizuho Bank has implemented APIs way back in 2017 to connect with customers and partners. It was assisted in this effort by IBM Cloud. Using the technology, the bank has been able to enhance customer experiences, offering customers personal financial management services and Internet of Things (IoT) payment options.
This article has been compiled based on publicly available information on the web, particularly the bank’s own website.