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The CEO noted that the funds will be channeled towards new products and the workforce.
Fintech startup Kyash, with visions of becoming Japan’s first financial institution combatant, raised $41.2 million in series D funding. In its Series C funding, Kyash raised $45 million during the Covid-19 outbreak in 2020. Kyash strives to gain ground in the Japanese retail market, the third-largest economy globally, hoping to expand beyond borders in the near future. Apart from expanding, the Kyash series D funding is to create strong ties and leverage on increased partnerships w while focusing on its pursuit of becoming a challenger to Japanese banks.
Kyash Completes Series D Funding
Investors of the Kyash series D funding include Block Inc (formerly Square), Mitsui Sumitomo Insurance, UK’s SMBC Nikko Securities, and Altos Ventures. Others are Japan Post Investment Corporation, Greyhound Capital, Hong Kong’s Yitu Capital, JAFCO Group, Goodwater Capital, and StepStone Group. Block’s investment in the funding marks its first backing in an Asian organization. Jack Dorsey, the Block CEO and blockchain enthusiast, has found investment value in Japanese fintech startups. For JAFCO, the funding marks its fifth investment in Kyash. Takuma Baba, MD at Japan Post Investment Corporation, said:
“Challenger Bank is a core to them in fintech and unbundling of traditional banking has become an irreversible trend globally. We believe Kyash’s user-first and mobile-first philosophy and product architecture will allow it to evolve into a key platform upon rebundling the financial services with technology.”
The CEO Shinichi Takatori noted that the funds will be channeled towards new products and the workforce. According to Takatori, who formerly worked in the banking and consulting sector, Kyash offers a mobile banking app that enhances offline and online transactions. He referred to the difficulty in creating a “sustainable business model based solely on payment in this industry.”
Kyash Benefits Despite Global Health Crisis
Kyash is one of the companies that generated revenue despite the negative effects of the coronavirus. At the peak of the health crisis, federal governments worldwide placed restrictions on cash, encouraging the use of cards or payments. As a result, debit card issuers like Kyash saw an increase in demand for services. The company’s increased online transactions led to a high growth rate. Specifically, the financial mobile banking service provider recorded the most growth of over 21% between January and May 2020, according to Fincog.
Furthermore, the Visa card issuer provides variability by issuing virtual and physical prepaid debit cards. Although it is not a bank, Kyash has applied for several licenses in Japan to enable traits of banking styles. The mobile financial app now has the right to produce prepaid debit cards and transfer funds. Expressing gratitude on the newly-completed round, Takatori said:
“We are very pleased to have support from investors and leading Japanese banks, for the additional investment from the shareholders that have supported us since our inception, and the new investments from the pioneers of financial services such as Block. We will continue with our customer-centric service spirit moving forward.”
Since its inception, Kyash has garnered about $107.7 million through financing rounds.