By Kentaro Otsuka

Yomiuri Shimbun Staff Writer

Mitsubishi UFJ Financial Group Inc. $(MUFG)$ plans to establish an online-only bank by the end of fiscal 2026, sources said. It will collaborate with U.S.-based Google LLC to make it more user-friendly.

With the advent of a "life with interest rates" making deposits more important, MUFG will strengthen its efforts to acquire individual customers, particularly young people.

The company is finalizing plans to establish the bank with 100% ownership and is expected to make an announcement as early as this month.

MUFG aims to attract young people, who are increasingly utilizing well-known online banks such as Rakuten Bank and Sony Bank. With MUFG preparing to launch its own online bank, competition for customers is expected to further intensify.

The new bank will not have physical branches, and services such as payments and deposits can be done via smartphones. Lower costs will make it easier for the bank to offer higher interest rates or lower transfer fees, which will likely lead to increased customer satisfaction.

The bank is expected to introduce a service that proposes optimal financial products at key stages in customers' lives, such as marriage, having children and purchasing a home, using artificial intelligence to analyze customer data.

MUFG will develop the service with asset managing service provider WealthNavi Inc., a company under its umbrella, to differentiate the new bank from other online banks.

The banking group hopes customers will open accounts when they begin college or start a new job, and maintain the account for a long time due to its user-friendliness and more attractive interest rates. Amid fierce competition, the group wants to secure a stable customer base at an early stage.

MUFG will collaborate with Google to utilize the tech giant's cloud infrastructure for the new bank's systems. This will facilitate data management and online operation, enabling swift improvements to app design and functions. MUFG plans to invest tens of billions of yen in development and other expenses.

Minna no Bank, an existing online bank launched by Fukuoka Financial Group, Inc., started operations in 2021.

But the online financial institution has been operating at a loss, partly because of the low deposit amounts of younger customers, and MUFG's new bank is expected to face the same challenges.

Whether MUFG is able to leverage its name recognition and brand strength, as well as ensure collaboration with a wide range of services offered by its umbrella firms, will likely determine the success of the online bank in the medium to long term.

This article is from The Yomiuri Shimbun. Dow Jones Newswires and The Wall Street Journal were not involved in the creation of this content.

(END) Dow Jones Newswires

May 07, 2025 20:53 ET (00:53 GMT)

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