2018.11.27 Financial Services
● Original credit scoring platform and loan service to be established
TOKYO – November 27, 2018 – LINE Corporation and Mizuho Financial Group, Inc. have agreed that their subsidiaries – LINE Financial Corporation ("LINE Financial"), Mizuho Bank, Ltd. ("Mizuho Bank"), and Orient Corporation ("Orico") – will take on a third party allocation of new shares to be conducted by LINE Credit Corporation ("LINE Credit").
The deal expects to complete in spring 2019. The planned initial shareholding ratio is 51% LINE Financial, 34% Mizuho Bank, and 15% Orico. LINE Credit will begin preparing for the launch of LINE Score, a personal credit scoring service, and LINE Pocket Money, a personal unsecured loan service.
Under its corporate mission of "Closing the Distance," LINE Financial will continue to operate LINE Smart Invest and LINE Insurance through the LINE messaging app and prepare other financial services to close the distance between people, money, and financial services. LINE Credit was established in May 2018 to build a credit scoring service and a loan service. Now that LINE Score and LINE Pocket Money are ready to begin preparing for service launch, the company has decided to increase capital.
Mizuho aims to pursue better use of technologies and to provide convenient financial services to a broader customer base by offering an open platform for third parties, utilizing its financial expertise. In order to provide the new scoring service and loan service to LINE users by using its financial expertise, Mizuho has decided to invest in LINE Credit as a financial related IT company on the assumption that any permission required will be obtained from the relevant authorities.
Orico is currently pursuing a sustainable growth by establishing a new business model through digital innovation etc. and expanding business area, under “Innovation for Next Orico” which is a new business policy of the next three-year medium-term business plan starting from FY2020/03. Orico will take on the new challenge of various initiatives through this new investment by utilizing its accumulated extensive expertise in credit related businesses such as unsecured loans service to individual customers and credit scoring model of several products.
The stakeholders have individually decided to enter into the latest agreement that consists of launching a credit scoring and loan service as part of LINE Corporation's efforts to expand its financial business. In addition to leveraging LINE's 78 million MAU*, the service will leverage the respective credit screening expertise of Mizuho Bank and Orico as well as relevant data the two companies have accumulated over time.
* Number of monthly active users in Japan
As a joint venture between the three parties, LINE Credit aims to build its own, unique, revolutionary credit scoring platform, and provide a loan service with excellent usability to users.
About LINE Score
LINE Score is a personal credit scoring service accessible to all 78 million LINE users in Japan. Users are screened based on an original credit scoring model and receive a credit score. The score visualizes credit valuations, and determines the best offer conditions when providing different services to users. In addition to Mizuho Bank and Orico's credit screening know-how, various information will be taken into account to calculate a user’s credit score including how he or she uses the LINE messaging app and its family services, other behavioral data collected through the LINE platform, and additional information the user enters. The unique credit scoring platform will be adapted to online financial services. The service will not calculate credit scores without the user’s consent.
The use of credit score data is planned to be expanded to other LINE family services. LINE Score is also expected to connect with external partners in the future.
About LINE Pocket Money
LINE Pocket Money offers personal, unsecured loans to users. Once the aforementioned credit scoring model is used to calculate a user's credit score, the service determines the user's maximum loan amount and annual interest rate. The service model currently being considered enables users to apply for, take out, and pay off loans seamlessly within the LINE app to help cover costs in sudden, unexpected situations such as drinking parties on short notice, business trips, and hospital visits.
Details regarding each service will be announced at service launch.
LINE Corporation Overview
(1) Name: LINE Corporation
(2) Location of Head Office: JR Shinjuku Miraina Tower 23F, 4-1-6 Shinjuku, Shinjuku-ku, Tokyo
(3) Representative: Takeshi Idezawa, Representative Director, President, and CEO
(4) Business: Provision and operation of the LINE messaging app and content and services made available on the LINE platform, in addition to other web service businesses and AI businesses
(5) Capital: JPY 95.7 billion (as of September 30, 2018)
(6) Date of Establishment: September 4, 2000
Mizuho Financial Group, Inc. Overview
(1) Name: Mizuho Financial Group, Inc.
(2) Location of Head Office: Otemachi Tower, 1–5–5, Otemachi, Chiyoda–ku, Tokyo
(3) Representative: Tatsufumi Sakai, President and Group CEO
(4) Business: Banking holding company
(5) Capital: JPY 2.2565 trillion
(6) Established: January 8, 2003
LINE Credit Corporation Overview (as of November 2018)
(1) Name: LINE Credit Corporation
(2) Location of Head Office: JR Shinjuku Miraina Tower 23F, 4-1-6 Shinjuku, Shinjuku-ku, Tokyo
(3) Representative: Yongsu Ko, Representative Director and CEO
(4) Capital and Capital Reserve: JPY 990 million
(5) Shareholding Ratio: 100% LINE Financial Corporation
(6) Established: May 1, 2018
LINE Financial Corporation Overview
(1) Name: LINE Financial Corporation
(2) Location of Head Office: JR Shinjuku Miraina Tower 23F, 4-1-6 Shinjuku, Shinjuku-ku, Tokyo
(3) Representative: Takeshi Idezawa, Representative Director and CEO
(4) Business: Provision of financial services
(5) Capital: JPY 22.5 billion (as of October 31, 2018)
(6) Established: January 10, 2018
Mizuho Bank, Ltd. Overview
(1) Name: Mizuho Bank, Ltd.
(2) Location of Head Office: Otemachi Tower, 1–5–5, Otemachi, Chiyoda–ku, Tokyo
(3) Representative: Koji Fujiwara, Representative Director, President, and CEO
(4) Business: Banking
(5) Capital: JPY 1.4040 trillion
(6) Established: July 1, 2013
Orient Corporation Overview
(1) Name: Orient Corporation
(2) Location of Head Office: 5-2-1, Koji-machi Chiyoda-Ku, Tokyo
(3) Representative: Masaaki Kono, Representative Director and President
(4) Business: Installment credits, credit cards loans, bank loan guarantee services, and payment guarantees
(5) Capital: JPY 150 billion
(6) Established: December 27, 1954