Mizuho Financial Group has agreed to acquire a 14.99% stake in Rakuten Card, a subsidiary of Rakuten Group, for approximately 165bn yen ($1.06bn).

As per the terms of the share transfer and shareholders agreements, Rakuten Card will remain a subsidiary of Rakuten Group, operating within the broader Rakuten ecosystem.

The share transfer is planned for 1 December 2024.

In November 2023, Mizuho, a major banking group in Japan, agreed to increase its stake in Rakuten Securities to 49%, as Rakuten Group grappled with financial challenges, primarily driven by losses from its mobile network unit, reported Jiji Press via Nippon.

This agreement came slightly more than a year after Mizuho bought about 20% of Rakuten and formed a business alliance.

Through their partnership, Rakuten and Mizuho aim to strengthen their credit card operations by leveraging their customer bases.

With over 30 million cards, Rakuten Card is a key component of the Rakuten Group, which seeks to expand its customer base through its points-based rewards system.

While Rakuten Card faces challenges in the corporate card market, Mizuho has struggled to gain traction in the individual card market.

Rakuten expects the sale of its stake in Rakuten Card to generate a special profit of 159.35bn yen ($1.02bn) at the unconsolidated level for the financial year ending in December.

Rakuten and Mizuho will also collaborate with companies such as financing firm Orient Corp. and UC Card Co. to enhance credit card services by streamlining payment processes and simplifying paperwork. This partnership aims to make transactions more efficient and user-friendly for customers.

Meanwhile, Rakuten Card and Mizuho Bank have announced the launch of the Mizuho Rakuten Card, a new co-branded credit card. Acceptance of Applications and issuance of cards will begin on 3 December 2024.

"Mizuho to acquire 15% stake in Rakuten Card " was originally created and published by Retail Banker International, a GlobalData owned brand.

 

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