Finatext Holdings Ltd.

Business Details

Provides complex core systems required for financial services operations via cloud-based SaaS. Smart Plus Co., Ltd. (securities) and Finatext Inc. (insurance/credit) operate the businesses. Revenue has a three-layer structure: flow revenue (initial implementation development fees), stock revenue (fixed monthly usage fees), and usage-based revenue (linked to transaction volume). A key feature is that partner companies handle customer acquisition, keeping the Group's customer acquisition costs low.

Recent Overview

Revenue and profit both roughly doubled year on year, driven by new partner adoptions and AUM growth

In FY2026 (ending March 2026), revenue was ¥6,635 million (up 46.5% year on year) and segment profit was ¥929 million (up 97.6% year on year). In the securities domain, Mitsubishi UFJ Morgan Stanley Securities and Bayview Asset Management adopted BaaS, expanding the number of services in operation to 28. In the insurance domain, SBI Insurance adopted Inspire, bringing the number of adopting companies to 17, while in the credit domain, JCOM Financial and others adopted Crest, increasing the number of companies in operation to 5. The company continues to make upfront investments centered on personnel recruitment.

Key Products

Growth Drivers

• Expansion of flow revenue through initial implementation support for new partners (across securities, insurance, and credit domains)
• Increase in usage-based revenue accompanying AUM growth and service growth of existing partners
• Strengthening of the revenue base through expansion in the number of BaaS services in operation (19 → 28 services)
• Growth of the insurance infrastructure business through rapid expansion in the number of Inspire adopting companies (11 → 17 companies)
• Launch and growth of the credit infrastructure business through expansion in the number of Crest companies in operation (2 → 5 companies)
• Expanding demand from large corporations and existing financial institutions amid the spread of embedded finance

Risks

• Usage-based revenue depends on partner companies' end-user acquisition, so partner companies' business conditions affect performance
• Risk of increased costs due to continued upfront investment in expanding financial infrastructure functionality and hiring personnel
• Changes in laws and regulations related to the securities, insurance, and money lending businesses, and regulatory responses, may affect business operations
• Because the business handles large volumes of personal information, information leaks or security incidents pose a risk of significantly affecting business credibility
• Risk of impairment of fixed assets (an impairment loss was recorded in the Financial Infrastructure Business two fiscal years ago)