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"There is no clear industry leader"

By Genki Oka

Genki Oka, head of Japan at Ant Financial Services Group, shares his desire to be an ambassador of the Chinese e-commerce giant in Japan and why he feels that it can succeed in the famously tough Japanese consumer market

Here is the transcript of the video.

Emmanuel Daniel (ED): Genki Oka-san, very pleased to meet you here this morning in Tokyo.

Genki Oka (GO): Thank you for the invite.

ED: Questions, what made someone as hardcore Japanese in terms of fintech innovation and stuff like that join Ant Financial?

GO: I think the short answer is I’ve spent 20 years of my life in the U.S. and 20 years in Japan. Considering that, there was one geography that I had missed throughout my life, and that was China. Through my previous lives, I just realised that there are so many things going on at the forefront, and they have innovated at a pace that is something unbelievable.

So, my whole instinct was to actually jump in there, go under the hood, look for myself in terms of what was really happening, and then learn and see if I could become sort of like an ambassador back to Japan. Because Japan, as you know, has long been known as a technological powerhouse. But it has been lagging recently. So, the idea is to make sure that we can bring the learnings back and leverage it as an industry.

ED: At the same time, what is the onboarding platform for Ant Financial in Japan, given that Japan has a lot of legacy infrastructure in payments, in processing, and even the ecosystem of a very fragmented marketplace and financial being Alibaba or Alipay in China has created a very huge ubiquity. It’s become a dominant player, and how can a dominant player enter a fragmented market in a developed market in a mature market; what’s the entry point, do you think?

GO: I think that, at least the early point is still in early days but the entry point for us has been the fact that there are millions of inbound Chinese travellers coming to Japan. Japan is a very popular destination, given the geographical proximity, and the cherry blossoms, and the unique cultural aspects. So, first of all, the thinking for us is to make sure that the dominant position in China can be replicated in Japan in terms of usage.

We have many merchants that have signed up with us that would like to get a piece of the inbound demand and make sure that Alipay can be used at their storefront. So that has worked in our favour as step one.

Step two is always about winning the hearts and minds of the local user base. We have no intention of doing that as Alipay, because we know that is not going to work. What’s going to be important and interesting about Japan is the fact that there is actually no clear leader. There is no clear industry leader. Because if there was one, we could ask if they would be interested in partnering, and we could drive the business through the local platform. But there is none.

This leaves the task of identifying an opportunity where there’s an unaddressed need in the local population. And that is my responsibility and that’s what I’m going to do.

ED: There was a time when a Japanese player like JCB went out to the rest of the world on a similar proposition which is the Japanese tourists travelling abroad. And every country they went to, they were able to plug into the JCB network. And in some ways, Ant Financial is doing just that with the Chinese tourists going around the world. But where JCB failed was that it was driven primarily because of economics.

Today, you have the additional dimension that a lot of the success of payment infrastructure is on social media. It’s where the conversation is in that regard. And, in other conversations we’ve had, you’ve alluded to is that Japan’s infrastructure is very nicely over-technologised, if there is such a thing. And in fact, it has to be far more simplified for players to be part of the conversation.

GO: That’s exactly right, and that’s the direction we would definitely like to head. I think the one example I raised about an 80-year-old grandma using Alipay in Japan is a clear sign that this should not be defined in terms of the age segmentation, for example. In Japan, it’s a hyper-aging society but still we lack services for the elderly. We’re not going to be an elderly-only platform, but the fact that we can serve the young and the elderly is going to be an important aspect for us going forward.

 So, taking out the complexity is going to be a key recipe for success, at least for us in Japan.

ED: What are the initial wins that you’ve been looking for, since you’ve been hired only recently?

GO: I think the initial wins are the fact that we have our minds set on winning the hearts and minds of the local Japanese. And in order to do that, it’s not going to be a dominant service where there is merchant acceptance. It has to be a case where our partner has the use case that is already habitual to a certain extent in the daily use. And the fact that we’ve been able to identify several, and several are interested and working with us, I think are early wins. It’s just too early to announce anything but hopefully it will happen sometime soon.

ED: We’ll keep tracking you, then. Thank you.

GO: Thank you.


Categories: Financial Technology, Payments, Technology & Operations
Institution: Alipay, Ant Financial
Country: Japan
People : Genki Oka, Emmanuel Daniel
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