Tokyo-Based Fintech, SmartBank to Expand Workforce with New Funding
Japan-based fintech startup, Smartbank has raised $26 million in a Series B funding round. SmartBank’s new funding is a mix of debt and equity financing.
According to TechCrunch, the fintech startup raised $18.8 million in equity funding from its current investor, Global Brain. New and existing shareholders who backed the funding round included Seven Bank and Spiral Regional Innovation. $7.2 million of the new funding is debt financing.
Unique Products
Tokyo’s fintech SmarBank offers two main products- a personal finance management app that provides users with a deposit account, and a prepaid card. SmartBank offers four types of prepaid cards. These are the Visa payment card for single users, the B/43 My Card, and the B/43 Pair Card for couples or partners. The fintech company also offers the B/43 Junior Cards for teenage users.
“Our core user base, which was B/43 My Card, is now the B/43 Pair Card users. This is significant as banks in Japan do not provide joint bank accounts, and B/43 has become the go-to product,” Yuta Shimogawara, SmartBank’s CFO said.
With the new SmartBank funding, the fintech startup plans to increase its workforce that currently stands at 49 to about 100 employees in 2025. Speaking to TechCrunch, SmartBank CFO said that about 50% of the fintech’s workforce will be in the engineering team.
Targeting the Youth
SmartBank was founded in 2019 by CEO Shota Horii, his twin brother who serves as the fintech’s CTO Yuata Horii, and the company CXO, Jun Taketani. The three brothers had sold a company called Fablic that they owned previously. The co-founders had noted that cash transactions were common in Japan. They set up SmartBank to address this gap in the consumer finance industry.
SmartBank targets individuals aged between 20 to 30 years old who want to manage their personal finances better. The fintech company also targets married couples with its products. Currently, SmartBank’s finance management app has been downloaded over 1 million times. The company did not disclose how many people use its app regularly.
Leveraging AI
SmartBank’s latest funding comes about two and a half years after the fintech company raised $20 million in Series A funding in 2022. The company has since expanded its customer base and product range with the aim of becoming a comprehensive financial platform.
In October 2024, the fintech company unveiled an AI feature for reading receipts. The feature leverages generative AI to transform SmartBank’s app into an AI-powered financial advisor. Using the feature, customers get a better understanding of their finances. They can use it to optimize and automate their financial activities, save, and even invest their money.
“Consumer fintech services in Japan have been slow to use AI, but our goal is to become the leading AI fintech company in the country,” SmartBank’s Director of Business Operations, Chihaya Akaike said.
The company has also added a new feature to its app to enable users link their bank accounts and credit cards to B/43 prepaid cards.
“We will be making our service accessible to non-card users so that users can start using B/43 without issuing a card and by simply linking their existing credit cards and bank accounts, which will also expand our revenue stream,” added.
Boosting Cashless Transactions
SmartBank is among the fintech companies that are supporting Japan’s initiative to increase cashless transactions. Using its finance management app and prepaid card, SmartBank is making it easier for people to switch to cashless payments.
Government data shows that most of Japan’s aging population prefers to transact in cash. In 2023, cashless transactions amounted to $885 billion. This represented 39.3% of the country’s spending. The Japanese government is looking to grow cashless transactions to 40% by 2025.
