An interview with Kazumasa Miyazawa


Sainsbury: What are your priorities for the next 12-18 months?

Miyazawa: There is still huge potential market for e-money and a lot of room to grow in Japan. Although annual personal expenditure in Japan is 300 trillion yen, current e-money market size is still only 3 trillion yen.

We are currently focused on accelerating smartphone based e-money and expanding new services such as our cloud e-money system “Rakuten Edy Online” which we launched in November 2012, along with promoting synergy between Edy and Rakuten group’s various services.

Sainsbury: What challenges and opportunities do you encounter as Japan’s largest e-money provider?

Miyazawa: We have continually innovated new services and have been the first mover globally in products such as mobile e-money, by utilising the latest technology available.

As having an integrated ecosystem for payments is essential to success for e-money, we have partnered with many companies such as banks, mobile operators, technology leaders and loyalty point partners, which includes  an equity stake in Edy for key partners. Our alliance with ANA was a key breakthrough towards creating customer demand for e-money services.

Sainsbury: How do you see NFC technology evolving in Japan?

Miyazawa: We have adopted multiple standards for NFC technology, not only FeliCa technology, and are therefore able to provide NFC based e-money solution not only in Japan, but overseas as well.

In Japan, FeliCa is the dominant standard in the market and so it will take time to update NFC based merchant terminals to type A/B. We are carefully watching the market to decide on the most appropriate timing for updates.

Sainsbury: Rakuten also runs a successful online shopping portal. How can Rakuten Edy leverage that organisation to better engage with customers?

Miyazawa: Rakuten Inc. has more than 80 million members with a strong loyalty point program based on Rakuten Super points and more than 40 thousand merchants on its core e-commerce platform Rakuten Ichiba.

Rakuten Edy provides an O2O (online to offline) connection for the group by providing both online and offline settlement, and we are able to leverage the Rakuten Ecosystem to expand the Rakuten Edy user base and merchant network through cross-service marketing and linkage to Rakuten member IDs.

Sainsbury: With a market the size of Japan, how are you addressing big data challenges?

Miyazawa: By utilising the big data from e-money transactions, we are able to provide relevant online-to-offline (O2O) services to our customers, such as discount coupons, additional point programs and useful information on offline merchants.

Sainsbury: What technologies outside of financial services do you have your eye on as a potential “game changer” in banking?

Miyazawa: One of the key potential game changers outside of the financial service industry is companies providing settlement services that bypass traditional payments networks such as Paypal and Square. In Japan, we are trying to stay ahead of the competition in this realm, and have launched Rakuten Smart Pay, a service similar to Square, that allows merchants to accept payments using a dongle connected to their Smart phone. Other technologies that could potentially affect the banking and payment business are services that leverage GPS location data, ultra sonic waves and payments provided by telecommunications providers.

Sainsbury: What tools or references keep you abreast of emerging technology trends?

Miyazawa: I try to keep up with emerging technologies by networking with various kind of companies such as IT, mobile, payments providers, credit card companies, marketing/advertising firms and merchants, which allows me to get a wide range of viewpoints from different perspectives.

Sainsbury: What do you consider to be some of the greatest achievements of your career to date?

Miyazawa: I joined Sony Corporation right after graduation, and learned creative thinking and importance of alliances with partners. One of my greatest achievements while at Sony was my role in developing the company’s first personal computer, VAIO, in partnership with Intel.

My other main achievement would be being one of the founding members of the first e-money services – Rakuten Edy – in Japan, and contributing to the development of e-money industry in Japan, which is probably the most successful e-money ecosystem thus far in the world.

Sainsbury: How do you encourage a culture of innovation within your team?

Miyazawa: I encourage my team to constantly challenge the norms of their industry and keep an open mind towards new ideas by not only keeping up with trends in the financial services industry, but also looking at trends and new developments in other industries.

Sainsbury: Every leader has a legacy they wish to be remembered for. What is yours?

Miyazawa: Of course, I would like to be remembered for my role in building the Sony VAIO and Rakuten Edy. However, my personal philosophy is to “Not stick to past success and continuously break the current rules and improve constantly” so as I am currently working on expanding Rakuten Edy globally, I hope that the success of our global expansion is something I can add to my achievements in the near future.