Japan Net Bank: Japan’s First Internet-Only Bank

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15th Bled Electronic Commerce Conference eReality: Constructing the eEconomy

Bled, Slovenia, June 17 - 19, 2002

Japan Net Bank:
Japan’s First Internet-Only Bank – A Teaching Case
Ali F. Farhoomand
Centre for Asian Business Cases, University of Hong Kong,
Hong Kong

Vincent Mak
University of Hong Kong,
Hong Kong

Japan Net Bank (JNB), Japan’s first Internet bank without physical branches, began operation in October 2000. It attracted mainly young customers looking for convenient, round-the-clock bank services with much more competitive interest rates and transaction charges than traditional Japanese banks. Its access channels included the mobile Internet service
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He also worked at the Sakura Research Institute, where he founded and headed the "Center for Aging and Environmental Studies”.



Kakuchi, Suvendrini (2001), “Economy-Japan: First On-line Bank takes on financial giants,”
Interpress Service, 25 January.

Ali F. Farhoomand, Vincent Mak



At the time of JNB’s launch, Sakura Bank, as the major stakeholder, owned 50% of the shares, with Sumitomo Bank, Fujitsu and Nippon Life Insurance each holding
10%. Mitsui & Co., NTT East, NTT DoCoMo and Tokyo Electric Power each held
5% of the shares. After Sakura and Sumitomo Banks merged on 1 April, 2001, to become Sumitomo Mitsui Banking Corp. (SMBC), the major stakeholder of JNB was SMBC, with a 60% stake [see Exhibit 1 and Exhibit 2].


Business Principles

JNB was one of the core Internet businesses of parent company SMBC – 80% of its full-time staff were transferred from SMBC. However, it aimed to build up its own, independent brand name and aspired to become the de facto standard of the
Japanese-style “Internet Specialised Bank” for the 21st Century‘s Internet community. Miyai put forward as the guiding vision of JNB’s business the
“customer-centric” principle, i.e., the Company and its services should be focused on customer satisfaction. He said:
In the Internet world … customers should be treated better than in the actual world. … We, as a company, have to seriously adopt
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