Japanese financial group Mitsubishi UFJ (MUFG) plans to turn its credit card division into a hub for managing digital currencies, in preparation for the transition to non-cash payments through digital currencies and digital wallets.
MUFG owns 85% of the shares of the largest Japanese credit card issuer - Mitsubishi UFJ Nicos. The remaining 15% belong to the Tokyo bank Norinchukin Bank, which serves mainly agricultural cooperatives. MUFG will pay ten billion yen (about $ 88 million) for Norinchukin Bank's stake in the deal, which is scheduled for 2017.
According to the official representative of MUFG, the company is ready for such actions, as it sees the grounds for creating a specialized company for the processing of payment platforms, in particular, non-cash payments based on digital wallets and digital currencies, as they become popular in Japan.
MUFG expects Nicos to manage the underlying system when digital currencies are distributed ubiquitously.
A notable shift of large banks and companies to the digital currency market occurs during the boom associated with the adoption of bitcoin. It is expected that the Japanese authorities will receive up to 18 applications for licenses for the opening of crypto-exchange exchanges.
It is noteworthy that the largest banks in Japan - MUFG, Mizuho and SMBC - investors Bitcoin BitFlyer. MUFG is also an investor in the Coinbase exchange.
Soon MUFG will be able to claim to be the first major bank in the world to issue its own digital currency, MUFG Coin. It is expected that at the end of this year the commercial deployment of the project will begin.
MUFG already produces coins MUFG for employees inside the company. The banking giant began developing its own digital currency in 2015.
The cost of one MUFG coin is equivalent to one Japanese yen - the bank seeks to convert the currency into a digital currency at a lower price for users. The Japanese bank is also developing a coin MUFG, which will be used for remittances using blockchain technology, which will significantly reduce costs.
In March 2017, MUFG signed an agreement with the payment firm Ripple, joining its "global payment management group." It is likely that MUFG intends to use Ripple's blockchain account for domestic and international money transfers using MUFG Coin.
In 2017, 47 Japanese banks completed internal remittances using the Ripple blockchain .