Japanese Fintech leader Smartpay was oversubscribed in raising $7 million in pre series A round led by Japanese technology investor SMBC Venture Capital.

Smartpay said in a statement on Monday that the round also saw participations from a Japanese venture capital firm Angel Bridge, and European venture capital firm Global Founders Capital and American venture capital firm Matrix Partners.

According to the statement, Smartpay has in this week launched Japan’s fully digital in-store payments with free automated installments.

It has developed new technology to enable merchants to set up Smartpay for in-store purchases with installments in 30 seconds and without any integration cost.

It aims to grow to 2 million consumers within two years and 30,000 merchants within three years.

“Japan is the fourth largest economy in the world. It is trillion dollars bigger than the Indian economy, 20 percent bigger than ASEAN and four times bigger than the Saudi economy,” its Chief Executive Officer and Founder Sam Pemberton Ahmed said.

“The impact of COVID on consumer needs, the renewed vigor in the Japanese economy that all merchants want to capture and the newly introduced policies and regulations by the government to accelerate digital transformation means Japan is right now going through a once in a 100-year transformation,

“We feel it is an honor to be part of a company that can play an important and positive role in the Japanese digital renaissance,” he added.

Smartpay is a fintech firm offering no interest, no late fees, and free of charge installments at the point of purchase in Japan.

The firm launched “Smartpay Bank Direct”, a digital financing service that allows customers to pay for online purchases straight from their bank accounts.

This service has given Japanese consumers who prefer not to pay by credit card, a digital payment method that aligns to their needs and provides convenient digital financing and installments.

The firm has signed and integrated with the 19 largest banks in Japan and over 200 credit unions thus accessible to 90 percent of Japan’s population with bank accounts.

Smartpay Bank Direct was developed with the Japan Electronic Payments Promotion Organization (JEPPO).

It is noted that Smartpay also helps the merchants by building a customer focused checkout process which provides them a higher conversion and lower cart abandonment rate on their ecommerce website.

“We hope that Smartpay will evolve into an indispensable infrastructure service for businesses and purchasers in all areas of consumption in Japan, not just online,” said Junya Yasuda, General Manager, Investment Sales Department IV, SMBC Venture Capital.

According to him, the results of Smartpay efforts are starting to bear fruit, and even though the service has only been in operation for a short period of time, it has already become a service that both businesses, including major corporations, and shoppers are very happy with.

He also noted that the firm’s business continues to grow at a phenomenal pace.

Yutaro Kasai, Managing Partner, Tomohiro Kobayashi, Senior Associate of Angel Bridge, said that Smartpay has a strong value proposition, a talented team, and advanced technology, and has great potential to become a unicorn in the fast-growing Japanese fintech market.

“The management and onsite team are both highly experienced and have built a strong network in the fintech industry,” he added.

Meanwhile, Roel Janssen Partner from Global Founders Capital, said that the firm back founders who start category defining companies.

“We believe Smartpay is innovating payments in Japan – one of the world’s largest and most important markets,

“Smartpay connects consumers, merchants and banks and adds value to this ecosystem in a way never seen before in Japan,” he added.

Matt Brown Partner from Matrix Partners, on the other hand, said that buy now pay later may seem simple, but the opportunity size and the complexity beneath that is massive.

“We believe the Smartpay team has assembled unique strengths in technology, finance, risk management, and sales to develop and own this market,

”Their early traction is impressive, but is just a small indication of things to come,” he added.

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