There are a few major reasons why I decided to start my business in London instead of Tokyo.
Firstly, the UK’s fintech scene is open, fairer and more equal and there’s many opportunities to network and engage with the community in London. All of these factors are contributing to greater competition, creating more synergy and more dynamism across the sector.
This is not the case in Japan. Many people say that Japanese fintech is several years behind compared with the UK and I think this is true. Japan’s Financial Services Agencies – the equivalent of FCA in the UK - has an insular and conservative culture than its counterpart in Britain. Also, Japanese traditional banks tend to hesitate to change their customs and, unlike those in the UK, are more closed to new innovative trends. They eschew new inspiration to keep their customs in tact.
I know that customs play an important role in running businesses and regulations are indispensable in finance and banking sectors, but they shouldn’t lead to closed environments and stifled innovation.
In the UK, for example, the crowdfunding sector is now subject to more regulations than before. However, at the same time, what is amazing to me is that the UK government, authority and participants in the sector always try to maintain as much fairness and openness as possible to keep the UK economy better and healthier. This open and collaborative culture is attractive.
Fintech is not about keeping vested rights and privileges in the financial market but to change the game or challenge them. Innovate Finance has hugely contributed to designing the definition of fintech with its emphasis on an open and transparent financial services - all of which are currently rooted in the market.
Secondly, lobbying activities do not have enough influence in Japan over the policy makers and there has been too much discussion on changing financial services. The Japanese fintech sector is experiencing a far less dynamic environment as a result.
There are also no fintech organisations to work with government, entrepreneurs and traditional banks to develop new ideas. The UK fintech players are trying hard to make the sector better through intense discussions and lobbying activities. This can foster a better business culture and environment with more competition and innovation.
Thirdly, the Japanese cultural foundation makes it challenging to develop a fintech sector because the Japanese tend to avoid taking risks. As innovators we are excellent at improving quality but not at inventing things. Our Japanese mindset is influenced by our cultural values and our virtue system, makeing it difficult to develop innovations from nothing.
The good news is that Japan’s entrepreneurial environment is slowly but surely changing and I hope that the velocity gains further speed so I can make contributions to both the UK and Japanese fintech sectors someday.
There are many things to consider and change along the way: the development of legal systems, government support and grants to the sector are just some. We have work to reform these things but it’s definitely possible. To make it happen, the policy makers and fintech players should learn from the UK example and follow suit.
Our banking system must be ready to be part of an international sector. We can’t continue to design our services based on the Japanese system, it makes us difficult to go to the global market. It is not only because of a language gap but also the rules of our systems –such as format, interface, protocols – which don’t work in the global markets at all. All are Japanese standards.
These are the reasons I choose London over Tokyo.
A new trade mission to Japan by UKTI and some of the UK's biggest fintech startups will introduce many UK talents to Japan. I am confident that this can provide the Japanese financial market with more stimulus and inspiration, leading to more sustainable developments of the financial market.