While Japan’s current legal system of financial services is basically established on business category, or sectoral basis, payment services, in particular, have become increasingly diverse, and some say that the current legal system of financial services makes the provision of flexible payment services difficult. Therefore, I think that it is important for us to review the existing legal system of financial services and to incorporate function-based and cross-sectoral elements, considering its functions and associated risks. The FSA’s Financial System Council has already started its discussions toward the establishment of legal system of financial services on function-based and cross-sectoral basis, and for payment services, consideration is being given to the creation of a new framework positioned between banks allowed to provide funds transfer service exceeding one million yen and funds transfer service providers allowed to provide its service up to one million yen, in order to allow funds transfer service for amounts exceeding one million yen; and to the revision of the framework to facilitate seamless and convenient payment services covering prepaid and post-pay services mainly via smartphones for small amounts. In terms of schedule, we are aiming to compile basic principles by summer this year, and after that to submit a bill as soon as possible to the following regular or extraordinary diet session, although I think that this would require a challenging amount of work.
