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FinTechs belonging to this category provide identification services, which are required for most banking services.
Introduction
Attitude of the country towards identification services
The government is active in involving FinTechs in identity verification. The government started to issue an "Individual Number Card" in 2016, which includes an IC chip used for interfacing with electronic certificates. Such certificates can be used not only for public services but also private services, both of which are called “Public Certification Service for Individuals”. Thanks to its convenience, the "Individual Number Card" is now widely spread and coverage has reached 78.6% of Japan’s population as of May 2025.
Legal affairs
Obligations and requirements to provide identification services
Although a license is not required for identification services, an electronic signature certification business (a business that certifies electronic signatures to confirm the end user) that conforms to certain criteria may obtain accreditation from the government. In addition, the certification business regarding the Public Certification Service for Individuals using "Individual Number Cards" is subject to certification by the government.
In the case of providing identification services, a FinTech service provider needs to pay attention to complying with the Act on Electronic Signatures and Certification Business, the Act on the Protection of Personal Information, and the Guidelines prescribed by National Center of Incident readiness and Strategy for Cybersecurity, among others.
Additional comments regarding the legal situation for identification services or what FinTech’s must be aware of in this business area
The Act on the Protection of Personal Information (“APPI”) clarified that data for physical features such as DNA, fingerprints, and other used in biometrics is included in the definition of "personal information" as an "individual identification code". Therefore, FinTech service providers need to be careful to comply with the APPI when handling this type of information.
Economic conditions
Market size for identification services and biggest companies in this business area
According to private research made public in 2023, the identification services market in Japan that year was expected to be about JPY 923.8 billion.
As of May 2025, there are nine companies which had obtained accreditation for the Act on Electronic Signatures and Certification Business. In addition, there are eighteen companies which provide the Public Certification Service for Individuals using "Individual Number Cards", which are certified by the authorities (as of June, 2025).