Japan API Banking Market Assessment, By Component, By Deployment Mode, By Application, By End-user, By Region, Opportunities and Forecast, FY2019-FY2033F

Japan API Banking market is projected to witness a CAGR of 13.24% during the forecast period, FY2026-FY2033, growing from USD 2.61 billion in FY2025 to USD 7.06 billion in FY2033. The Japan API banking market is being propelled by a combination of regulatory reform, demographic shifts, and increased international cooperation. Japan is reforming its traditional financial services ecosystem, and the hasty digitization of legacy banking systems in larger institutions, such as Sony Bank, MUFG, and Mizuho, has created a more agile and API-ready infrastructure. This is also in line with Japan's broader national strategy to innovate in Fintech and improve efficiencies, while helping financial institutions interact more easily with international standards. We are also seeing accelerated development by non-traditional payment entities, digital-first banks, and technology vendors as Japan moves toward open finance.

Japan's API banking industry is undergoing an advanced digital transformation process led by major entities.

For instance, in May 2025, Sony Bank, Inc., recently migrated to a new cloud-native core banking system entirely based on SaaS architecture. This illustrates Japan's widespread paradigm shift toward composable, flexible banking systems that support the integration of open APIs, offering banks increased flexibility and innovation. Sony Bank's transition to the nCino platform clearly illustrates a sustained institutional commitment to replacing legacy systems supporting a modular approach to API banking. This approach enables service delivery on a modular basis, real-time data, and third-party connections.

This change can provide internal improvements and external access for developers, while laying the foundation for scalable API-first banking services in retail banking and corporate banking. As traditional Japanese banks face increasing challenges from neobanks and fintechs, open API adoption must become a key avenue for modernizing their banking infrastructure. Institutions such as Rakuten Bank, GMO Aozora Net Bank, and Japan Net Bank (PayPay Bank) are enhancing their securitized offerings as a part of the multi-faceted modernization of their institutions, which substantiates a systemic trend in Japanese banking toward flexibility in digitized banking.

Cross-border Payment Expansion and Fintech Inclusion

The API banking sector in Japan is undergoing a rapid change due to increased overseas fintech activity.

For instance, in October 2024, Wise Japan became the first foreign-owned company to connect to Japan's payment clearing network, enabling it to transfer its clients' money smoothly across borders through local banking rails. This represents a pivotal moment in history, reflecting how agnostic regulation and a well-developed API ecosystem are fundamentally changing the way companies access Japan's domestic financial infrastructure. In Wise's API-enabled model, users can avoid traditional remittance payments and benefit from faster and cheaper cross-border payments.

The onboarding of global fintech players, such as Wise, demonstrates how Japan is fostering an interoperable environment for real-time, international payment services utilizing APIs. This progression benefits consumers, small and medium-sized enterprises (SMEs), and exporters by providing transparency and efficiency in financial services. Traditional financial institutions with an API focus, such as MUFG Bank, Mizuho Bank, and Resona Bank, are paying close attention and investing in overseas API capabilities to remain relevant and competitive.

Card Network and Gateway Integration is helping to grow the API Banking Market in Japan

Deeper integrations of card networks also aid API banking in Japan. For example, in November 2023, Stripe and JCB expanded their partnership to offer more access to JCB's payment network for global e-commerce merchants. This integration with Stripe's powerful API platform will simplify onboarding and payment processing for Japanese businesses in international markets. It will also allow JCB payments for millions of businesses that are already integrated with Stripe's APIs, thus providing greater financial inclusivity and facilitating scalable cross-border commerce.

Such developments are also encouraging traditional financial institutions to provide APIs for developers to keep pace with fintechs. Financial institutions, such as the State Sumishin Net Bank and Fuyo Information Systems Co., Ltd., are updating and improving their API interfaces to provide payment scenarios that match the new possibilities these payment networks offer. These developments are highlighting payment gateway APIs as the bedrock of Japan's open banking evolution.

Dominance of Account & Transaction Management APIs in the Market

The Account & Transaction Management application segment is the number one area in Japan's API banking ecosystem. This increased due to national-level initiatives, including reforms implemented in November 2024., when Japan's three megabanks, MUFG, Mizuho, and SMBC, will integrate stablecoins via SWIFT rails across their banking systems to facilitate cross-border payments. These initiatives will leverage secure, real-time, account-level APIs for tracking, managing, and reconciling multi-currency payments, demonstrating Japan's shift toward programmable finance. More generally, account APIs facilitate settlement and treasury services, as well as deposit tokenization and smart contract execution. They are becoming increasingly critical in the context of stablecoin-backed financial products. Firms such as Rakuten Bank and TIS Inc. plan to further scale their API offerings to prepare for changes in settlement standards and to help protect their TP infrastructure.

Key Players Landscape and Outlook

The competitive dynamics in Japan's API banking market are changing rapidly, as illustrated by recent research from July 2024, which highlights Japanese banks' digital transformation strategies and the Tailwind of higher interest rates. Traditional banks are evaluating how to carry forward their presence in the API space by investing in open API systems to improve efficiencies, manage their interest margins, and reposition themselves strategically. This shift is not only about upgrading technology, but also about how they redefined the value proposition for banks. For example, Fuyo Information Systems Co., Ltd. and TIS Inc. appear through the API structure as B2B integration players, working with banks to manage APIs for key use cases such as trade finance, SME lending, and corporate treasury.

On the other hand, traditional retail players, the open Bank such as Sony Bank, Rakuten Bank, and GMO Aozora Net Bank, are considering customer-facing APIs to enhance their embedded finance, automated savings, and robo-advisory features. Overall, these things, when viewed together, define an incredibly fast-moving and competitive API market in Japan, where legacy institutions and new entrants are preparing to reposition themselves for continuing relevance in the digital landscape.