TOKYO -- The launch of IY Bank, which is slated to become the first Japanese online bank to use ATMs for many customer transactions, will be delayed until May from a planned March start-up, according to Reuters.
IY Bank, owned by Japan's biggest retailing group Ito-Yokado Co Ltd. and to be run through its Seven-Eleven Japan Co Ltd. stores, has hit delays partly due to a disagreement with several city banks over commission fees for an ATM cash network.
That network, known as BANCS, would allow customers of member banks to withdraw cash from the ATMs of fellow member banks. Membership in the ATM network is considered crucial for Ito-Yokado to launch its services, Reuters reported.
Ito-Yokado, a supermarket chain operator, applied to the Financial Services Agency for an online banking license in November as one of several new entrants in the banking sector.
Ito-Yokado said in January that it had expected to receive the license by the end of March, after missing its initial target of the end of last year.
According to the Reuters report, banking sources said Ito-Yokado and members of BANCS have mostly reached an agreement on commission fees, but that IY bank may still start its business later than May because it may take three months to connect IY to the BANCS network.
Online banking is still in its infancy in Japan, partly due to the fact that many people are still reluctant to make payments online.
