News

Japan's IYBank opens ATMs to credit card companies

May 8, 2002

TOKYO -- Japan's IYBank, a settlement-only bank owned by supermarket chain Ito-Yokado Co., will give four credit card companies access to its ATMs at Seven-Eleven Japan stores and other locations, according to a report in the Financial Times.

Holders of credit cards issued by JCB Co., Sumitomo Mitsui Card Co., UC Card Co. and IY Card Service Co. will be able to borrow and repay money through IYBank ATMs.

The bank hopes that the deal will encourage more people to use its ATMs. The average daily number of ATM users had risen to 34 per machine by March, though it is still below the break-even level of 70 users targeted by the bank.

IYBank, which launched in May of 2001, suffered a net loss of 5.6 billion yen ($42.1 million) in its first year when it failed to attain its daily target for the use of its ATMs installed at 7-Eleven outlets. In a recent interview with Jiji Press, President Takashi Anzai said the bank hoped to achieve its goal of making a profit by its third year.

IYBank has agreements with Sumitomo Mitsui Banking Corp, UFJ Bank, Asahi Bank, Sanwa Bank, Shizuoka Bank and Chiba Bank allowing customers of these banks to use IYBank's ATMs. In return, IYBank receives interchange fees.