November 30, 2023

How Habitto managed to break into the Japanese Fintech scene in record time without knowing a word of Japanese

Japan, for many non-Japanese entrepreneurs, is a wonderful market but with many barriers. A different language. A culture very different from that of the Western world. A conservative and slow decision-making process in corporations. These all seem to signal that change is not welcome here.

That might not be the case, actually.

Fintech start-up Habitto saw new openings even when the doors all seemed closed.

Habitto is Japan’s first digital bank offering financial advice that primarily targets people without a money strategy, with an emphasis on a savings interest rate of 0.3%, which is higher than most traditional banks. They aim to seamlessly assist individuals who are not traditionally engaged in financial planning by providing a connected experience across banking, investments and insurance in their app, along with offering access to online human financial advisers.

Despite being foreign founded, Habitto managed to secure an intermediary license from the Japanese Financial Services Agency (JFSA) faster than any other start-up since the license’s introduction. Yet neither of the cofounders is Japanese. CEO Samantha Ghiotti is from Italy, and cofounder Liam McCance is Australian. Team members come from all around the world, ranging in age from 19 to 65 years old.

How could a new brand, a group of foreigners, with a license that has never been issued before, manage to make a mark in the conservative Japanese market?

“I don’t speak Japanese!” Ghiotti admitted with a laugh when asked if she speaks the language. “Compared to other Japanese companies, we do indeed stand out as a group of odd ones out,” she continued, and what Habitto aims at is something that hasn’t been done before.

“In fact, the name ‘Habitto’ is derived from the English word ‘habit’. Because we want to help the young generation build good money habits.”

Both Ghiotti and McCance are veterans in the Fintech industry. Why would they choose to venture into the Japanese market? Ghiotti noted that there has been a gradual shift in conservative financial attitudes in Japan recently. Combined with the introduction of new regulations, and considering various factors, they believe that this presents an extremely promising large market.

In an era of zero interest rates, the Japanese people continue to save money

Japanese people are known for their conservative outlook when it comes to money. Statistics show that in the personal financial assets of Japanese individuals, “cash” or “deposits” alone make for over 50%, while other financial products such as stocks, bonds, and trusts account for only about 16%. This attitude reflects their reluctance to take risks.

Why do Japanese people love saving money? The economic bubble in the 1990s had Japan navigating through a period when the notion that “investing is too risky, saving is a virtue” took deep root in the culture. Furthermore, Japan has long been mired in economic stagnation, prompting people to place their money in banks with nearly 0% interest rates rather than face unknown risks in financial markets.

However, the challenges of living a 100 years life, in an expensive country, with rising inflation and lower prospects for government support are creating unprecedented opportunities.

Two key changes led Habitto to discover new business opportunities

The first change is the shift in the Japanese mindset, where “savings are a top priority.”

According to a 2019 report from the JFSA, pension payments for Japanese citizens are expected to decrease gradually in the future. Additionally, Japan’s unique lifetime employment system within corporations is gradually fading. With Japan’s increasingly aging population, coupled with the erosion of purchasing power due to inflation, those who persist in leaving their savings in the bank without earning interest may encounter the crisis of elder poverty.

“Habitto targets people without a money strategy, meaning individuals that get a paycheck, put 20% at the bottom of zero yielding bank accounts and worry deeply about their financial situation”, Ghiotti explained. Recognizing the need for an accessible entry point into financial management, Habitto begins with savings—a financial product that Japanese people understand well. They provide a deposit interest rate of 0.3%, surpassing the near-zero rates offered by most banks.

In addition, they target the psychological fear among the Japanese of not being able to recover their principal, emphasizing the deposit insurance system. This ensures that even in the event of a bank’s bankruptcy, the principal and interest deposited by users will be safeguarded.

The second change is the favorable impact of new policies.

At the end of 2021, the JFSA introduced a new intermediary license through the Act on Provision of Financial Service. This new intermediary law expands the horizons of financial products, moving from single-product sales to a more comprehensive integration of financial products, driving innovation and user experience in the financial industry.

Habitto leveraged this new regulatory environment by integrating savings, insurance, and investment into a single app. Habitto also recognized the Japanese preference for personalized services and introduced real-person financial consultations through video and chat functions within the app, allowing users to take their first steps into investing or purchasing insurance.

Decision-making speed and acumen are keys to opening up new markets

In Japan, businesses are known for their slow pace in fostering new collaborations, setting business cooperation milestones on a yearly basis. However, for start-ups racing against time and limited resources, this can be a significant challenge, as every moment counts.

“When we were just starting out, we faced the challenge of COVID-19, and building the business remotely seemed impossible.” But opportunities wait for no one, and Habitto did not wait idly by. The first step was to recruit the right talent. Ghiotti mentioned that although they couldn’t physically enter Japan at the time, they promptly recruited several high-profile individuals from the Japanese financial sector, including Yasunori Kume (formerly CEO BNP Paribas Cardif) and Shigesuke Kashiwagi (formerly CFO Nomura Holdings). Building a network within the financial industry allowed them to seamlessly navigate the intricacies of Japanese business collaborations.

Speed is also a crucial factor. While many companies were still sitting on the sidelines, Habitto had already taken the lead by submitting the application within the first two months of license availability. This allowed them to launch services ahead of competitors.

Habitto has continued to see an increase in downloads. “It’s not easy for a new brand to gain the trust of the Japanese people, but conversely, once trust is established, Japanese consumers have shown extremely high brand loyalty. I believe that this is a market with tremendous potential. “

While the development of new financial tools in Japan is still in its early stages, changes are happening quietly. Those who can seize the opportunity as pioneers will be the ultimate winners.


  • Potential for Growth: Habitto’s tailored approach to local preferences, offering financial products like high-interest savings and personalized services, positions them well for potential market breakthroughs.
  • Regulatory Opportunity: Some of the most successful fintechs leveraged regulatory arbitrage as a first mover advantage. Habitto quickly capitalized on new Japanese financial regulations, integrating multiple financial services into their app, which gave them a competitive edge.
  • Strategic Agility: Habitto’s rapid decision-making and recruitment of local financial experts helped them navigate the Japanese market’s complexities efficiently.

This article has been contributed to AsiaTechDaily.

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