SMBC and Money Forward to Partner on BaaS/Digital Banking

Money Forward has decided, by a resolution of its Board of Directors, that it will enter into a basic agreement with Sumitomo Mitsui Financial Group and Sumitomo Mitsui Banking Corporation regarding the establishment of a preparatory company to consider the provision of BaaS/digital banking, and that it concluded the agreement. Each partner will hold 50% of the joint venture entity. The preparatory company will proceed with considerations aimed at establishing and launching a new bank, subject to the necessary approvals and permits from relevant authorities.

This move comes mere days after MUFG and Money Forward have parted ways on their factoring joint venture, Biz Forward, with Money Forward making Biz Forward a wholly owned subsidiary.

Background and Purpose of the Basic Agreement

Money Forward has been promoting the provision of Fintech services to support corporate growth by streamlining back-office operations through SaaS services such as Money Forward Cloud Accounting, which are currently used by over 400,000 sole proprietors and corporate customers as of the end of February 2025.

Customers already using Money Forward's Fintech services can benefit from accounts receivable guarantees through Money Forward Kakebarai, improved cash cycles through Money Forward Pay for Business, and early collection of accounts receivable through Money Forward Transaction Finance for Startups and Money Forward Early Payment.

However, it has been challenging for financial institutions to deliver adequate financial services to small and medium-sized enterprises, which are said to account for 99% of Japan's businesses. Against this backdrop, the SMBC Group has set forth the "Creation of social value through 'supporting corporate DX with digital solutions’" as part of its medium-term management plan and has been considering the deployment of various services under fundamental digitalization.

Consequently, the Company has formed a partnership with the SMBC Group and Sumitomo Mitsui Banking Corporation to jointly build a new BaaS/digital banking service and promote corporate DX and financial experiences.

Initiatives Planned for the Future

The preparatory company will aim to develop a new digital banking service and consider providing BaaS to business companies and financial institutions using the APIs realized through this initiative. Details such as the outline, service content, and schedule of the BaaS/digital banking will be determined by the preparatory company and announced once decided.