#Japan #Chiyoda #BaaS #My Number Card #Smart Plus

Smart Plus Integrates Public Authentication in BaaS Platform

Smart Plus, a part of the Finatext group headquartered in Chiyoda, Tokyo, has announced a significant upgrade to its securities business platform, "BaaS (Brokerage as a Service)." The new functionality, which will be available starting May 27, 2025, involves the implementation of a public authentication service utilizing Japan's My Number Card.

Background and Purpose

In recent years, enhancing the security of online transactions has become a crucial issue within the financial sector. The Japan Securities Dealers Association recommends the use of public identification services, especially for identity verification during account openings, as a best practice in their guidelines for preventing unauthorized access to online transactions. Moreover, the government is planning to unify these practices into an "eKYC method" after April 2027.

The rapid expansion of the eKYC market, the tightening of regulations under the Anti-Money Laundering Act, and the government’s push towards a digital society have all supported the introduction of public identification services.

Based on these dynamics, Smart Plus will implement the "eKYC method" using the My Number Card, aiming to enhance the convenience and security of services offered by partner companies utilizing BaaS. Additionally, the introduction aims to streamline administrative tasks related to identity verification and reduce the costs associated with the processing and examination of identification documents, thereby supporting the competitiveness of partner enterprises.

Benefits of Public Authentication Using My Number Card

This new service leverages electronic certificates stored on the IC chip of My Number Cards for online identity verification. The introduction of this public authentication service offers several advantages:

For Customers:

• - Simplified and Quick Process: No need for document photographs, uploads, or mail. Users can complete the process simply by holding their My Number Card to their smartphone, enabling applications anytime and anywhere in a short time.
• - High Security Assurance: Utilizing government-issued electronic certificates reduces the risk of identity theft and ensures safe verification of personal information.
• - Improved Accuracy of Input: Automatic reading of information such as name, address, and date of birth from the My Number Card minimizes any chances of errors and reduces manual work.
• - Faster Account Setup: Compared to traditional methods, the efficiency of the account opening examination process accelerates the initiation of service utilization.

For Partner Companies Utilizing BaaS:

• - Reduced Development and Operational Costs: There is no need for individual system development for public authentication, allowing access to the latest functionalities at a low cost via the SaaS-based common infrastructure of BaaS.
• - Automatic Compliance with Legal Changes: With BaaS already updated for regulations effective after April 2027, partner companies won’t need to undertake additional adaptations.
• - Strengthened Security Measures: The identity verification functions comply with the security standards recommended by the Japan Securities Dealers Association, contributing to enhanced reliability for partner firms.
• - Consistent Customer Experience Quality: A standardized, high-quality identity verification process ensures a consistent customer experience across partner companies.

Benefits in Account Opening and Exam Operations:

• - Improved Accuracy in Identity Verification: Using the My Number Card for identity verification reduces risks associated with fraudulent account openings.
• - Streamlined Examination Processes: The elimination of subjective “face verification” processes promotes automation in the examination procedures.
• - Lower Document Management Costs: Costs associated with the reception, verification, and storage of physical identity verification documents are reduced.
• - Enhanced Anti-Money Laundering Measures: Accurate identity verification strengthens security against financial crimes like money laundering.

Launch Schedule and Target Scope

• - Launch Date: May 27, 2025.
• - Initial Implementation Scope: New account opening procedures (specific accounts and NISA accounts).
• - Supported Devices: Native apps for iOS and Android (with web browser compatibility planned for future).

Planned Partner Companies

The following partner companies will initially utilize this functionality:

• - IFA Leading Co., Ltd.
• - Imamura Securities Co., Ltd.
• - Iwai Cosmo Securities Co., Ltd.
• - Japan Asset Management Co., Ltd.
• - Daiichi Hokuetsu Bank
• - Nippon Life Asset Management Co., Ltd. (“Goal Navi” and “N Direct”).
• - Heikin Credit Union
• - Financial Standard Co., Ltd.
• - 400F Co., Ltd.
• - Mitsubishi UFJ Asset Management Co., Ltd., etc.

Future Developments

Currently, the service is limited to new account opening procedures. However, plans to extend the applicable range to customer information change procedures (such as address changes) are underway. Furthermore, support for web browsers is also planned to widen access to the public authentication service. Through these enhancements, Smart Plus aims to significantly increase the service value offered by partner companies.

About BaaS

BaaS is a securities business platform that provides a complete suite of operational systems necessary for delivering securities services, managing all external collaborations in the cloud via APIs. The separation of the front system from the middle and back systems allows for easy development of services tailored to customer requirements, while providing the flexibility to adapt to external changes in regulations and environments. Utilizing BaaS enables timely and low-cost deployment of high-value unique services.

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For more information about Smart Plus and the Finatext Group, visit their official websites or reach out directly for inquiries regarding services and partnerships.