Japanese banks foray into big data through personal info brokering

Sumitomo Mitsui Trustbank received approval to operate an information bank.

Japanese banks are entering a new era as they go into personal info brokering, The Asahi Shimbun reports.

The government-backed Japan Federation of IT Associations has given the green light for Sumitomo Mitsui Trustbank and Felica Pocket Marketing, a subsidiary of retailer Aeon Co., to operate a data brokerage service that will allow them to establish an information bank that will buy and sell customers' personal data.

Under the service, the company will receive data from customers such as their name, purchase history and health-related information, in trust. Upon customer consent, the bank will provide data to companies that are eyeing to develop new products. Similar to the bank's practice of paying interest on a deposit, customers who shared their information will be compensated with cash, coupons or bank services.

In cooperation with Osaka University Hospital, Sumitomo Mitsui Banking is preparing to launch an information bank that handles medical data.

Other banks have also revealed their plans to go into personal info brokerage, with Mitsubishi UFJ Trust and Banking (MUFJ) eyeing to launch its information bank by the end of fiscal 2019. The service includes selling the information to insurance companies, food companies and individuals who want to use it for market research.

Meanwhile, Mizuho Bank has partnered with SoftBank Group to launch an information bank called J.Score in the hopes that their collected data could be useful for determining loan eligibility to operate a consumer finance business.