TOKYO -- For a country with such a strong reputation for advanced technology, Japan has lagged far behind its global peers when it comes to applying it to financial services.
Both the national and metropolitan governments have now embarked on an aggressive push to make Tokyo a global financial hub to compete with New York and London. But it is at grass-roots level that some of the most visible developments have been made in the country's emerging fintech sector.
Serial entrepreneur Kazuma Ieiri ran for Tokyo governor in 2014 before becoming chief executive of Campfire, a crowdfunding startup that helps small businesses, ranging from film production companies to restaurants.
Entrepreneurs like Ieiri have seen an opportunity in helping households and small businesses get money-smart in an age of low growth, government debt and a public pension crisis.
They are not necessarily signing up for the official bid to put Tokyo on the fintech map, but their efforts have provided a significant boost for the city.
Many experts have pointed to the huge potential in the country, given the talent pool at firms like Sony and SoftBank.
"It's a marvel, Japan has created some of the most wonderful technologies and beautiful designs," said Michael Harte, Barclays' head of Group Innovation, "however, in financial services these have tended to be more focused on services for Japan."
If Tokyo wants to be a global center of finance, he argues, Japanese fintech startups need to "design for global use."
"We all need to partner with organizations across the world, design and export innovations to multiple markets as they are developed here in Japan in order to achieve scale," he said.
One suggestion Harte has is to offer free services abroad. He cites examples like Google and Facebook using drones, balloons and satellites to spread internet access in developing countries -- moves designed to create a platform that pays off in the long run.
"We shouldn't think that the only route to success is taking what is already built to other countries."
Japanese startups are still largely invisible on the global fintech landscape.
"Very few Japanese fintech firms are known overseas for their service or technology," said Nobuyuki Hirano, chief executive of Mitsubishi UFJ Financial Group and chairman of the Japanese Bankers Association. He was speaking on Tuesday at FIN/SUM, a conference in Tokyo jointly organized by NIKKEI and Japan's Financial Service Agency.
According to a review of global fintech hubs released by Deloitte in April, Tokyo trails Singapore, Hong Kong and Sydney in the Asia Pacific region.
Moreover, the value of fintech deals came to only $87 million in Japan last year, less than 1% of the global total of $17.4 billion. About 80% of the deals took place in China and the U.S.
But the industry could now be in for a tail wind. The report notes that "Japan has seen strong growth in the fintech ecosystem in the past two years."
Tokyo Gov. Yuriko Koike has spoken enthusiastically of building the city's financial hub around the fintech industry. Major banks are also keen to team up with startups in order to ride out disruption that will at some stage arrive from overseas.
"For existing financial institutions with massive legacy platforms, such as branch networks and computer systems," said Hirano, "it is imperative to streamline operations and generate new value added through digital transformation."
Japanese banks are opening up their customer information to startups like Money Forward, a provider of accounting and wealth management services for small businesses and households. The company has been described as Japan's answer to California-based Intuit and is set to go public later this month.
"In the past, financial institutions only went after wealthy clients," said Yosuke Tsuji, a former Sony employee and co-founder of Money Forward. "The internet has significantly lowered the cost of providing financial services, making it viable to do business with small customers," he said.
For many entrepreneurs, global expansion is not a primary motive. Most are simply trying to respond to economic challenges facing people around them, such as a labor shortage, lack of pension savings, or an influx of cheap products from elsewhere.
BASE, for example, helps small retail businesses sell online by providing easy-to-use e-commerce platforms, such as an Alipay-style QR code payment system.
"The power of fintech, is the ability to bring down the barrier between haves and have-nots," said Yuta Tsuruoka, chief executive of BASE. "I'm not interested in making life even better for people who already have access to good services. My goal is to reach out to those who still don't have access to good services."
Nikkei staff writer Shotaro Tani contributed to this article.