Mitsubishi UFJ’s New Unit Dedicated To FinTech Research- Report

According to latest reports, Mitsubishi UFJ Financial Group Inc. has set up an Innovation Lab division to research and develop new financial technologies, people familiar with the matter told Bloomberg.

The unit, the first of its kind for a major Japanese bank, is starting with 15 employees in Tokyo and Silicon Valley and scheduled to be unveiled Jan. 8, according to the sources. The sources also told the media house that that the division aims to develop financial products and services and will work with universities, research institutions and fintech companies and use resources within Mitsubishi UFJ including its securities and trust-banking units.

The bank will set up offices physically separated from its main operations and will employ a casual dress code to help promote a “startup culture” and facilitate closer cooperation with outside ventures. It is also considering adding a third location for the unit in a major city in Asia, according to the sources.

In its 2015 global banking review, McKinsey & Co. said that the number of fintech companies is “exploding” - there were over 12,000 such firms as of August and venture-capital investment tripled to $12.2 billion in 2014 from a year earlier.

Bloomberg said that banks are increasingly undertaking research on financial technologies to counter the threat that startup ventures may pose to the financial industry as well as capture the growth potential they offer.