PAYPAY Securities aims to double the number of its brokerage accounts to two million by the end of this fiscal year to March from about one million now, backed by users of the group’s cashless payment system, according to its chief executive officer.
The Tokyo-based company’s top shareholder operates PayPay app, which had about 60 million registered users as at October, and investors are able to conduct brokerage transactions on the payment app. PayPay Securities expects the convenience of that set-up to boost the number of its users, said CEO Kenji Bansho.
PayPay Securities needs to increase its users and the amount of assets they invest in to meet its goal of becoming profitable in the next few years. The company has been in the red since it opened for business in February 2021, and it posted a net loss of 4.6 billion yen (S$238.7 million) in the fiscal year ended Mar 31, 2023, according to its latest disclosure document.
The company’s biggest shareholder, PayPay, is a subsidiary of SoftBank founded by billionaire Masayoshi Son. PayPay Securities has already seen its accounts double in a year to about one million as at March. And the start of tax-exempt savings accounts known as Nisa this year has accelerated the opening of accounts by retail investors in Japan.
But it’s a crowded field, even without the country’s big bank-backed brokerages. PayPay Securities ranks No 6 for online brokerage accounts as at March, trailing No 1 firm SBI Group including SBI Securities with 12.5 million accounts and Rakuten Securities with 10.9 million. Nomura Holdings, Daiwa Securities Group and units of Japan’s largest banks dominate the traditional brokerage arena.
PayPay Securities will likely exceed two million accounts and “it will continue to grow at a considerable pace”, said Bloomberg Intelligence analyst Hideyasu Ban. But it will take time for the firm to break even because of the small amount of investments per customer, and it’s important for the company to make efforts to boost that figure, he said. BLOOMBERG
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