Japan’s Mizuho partners Google to accelerate tech transformation after a year to forget

Mizuho Financial Group is working with Google to transform its operations to keep pace with changing customer demand and repair reputational damage caused by IT-related shortfalls.

The company’s president was forced to resign last year after a major IT glitch in March. He was followed out of the door by the CEO after regulators reprimanded the company for IT failures in November.

The company has since accepted its IT failures and installed a new CEO and president. Following the announcement of the agreement with Google, Masahiro Kihara, who took on the CEO role, said the bank needed to change because customer demands had already done so.

“The global spread of Covid-19, along with megatrends such as digitisation, the ageing population and globalisation, have led to significant changes in our lifestyles and economies,” he said.

“To deliver on the needs of our customers in this new era, we’re working with Google to enhance our operational capabilities, innovate across our online and mobile channels, and transform our corporate culture. Through this partnership, we will become a stronger and more resilient financial group which our customers can trust,” stated Kihara. 

Google will support the finance group’s ambitions around personalising services for customers through data-driven platforms. To this end, it will build a digital marketing platform on Google Cloud that is integrated with Google Analytics.

Mizuho said Google Cloud’s advanced data analytics technology would generate real-time insights about customers’ preferences to anticipate their needs and use artificial intelligence to deliver personalised experiences.

Using Google Cloud, Mizuho will also create banking-as-a-service which can be used by other enterprises to offer their customers.

Through the deal, the bank’s systems will be modernised to make them more agile and secure. The company’s corporate culture will also be transformed by adopting Google’s approach to product development and problem solving, which it hopes will attract top talent.

“The use of cloud technology, including real-time data analytics, artificial intelligence and machine learning, is progressing rapidly in the banking industry in Japan,” said Google Cloud CEO Thomas Kurian.

Today’s consumers want to bank in real time. They want to watch what their money is doing, move it around quickly, pay for things in an instant – and all of this on their smartphones.

As a result, customers want to know about the technologies banks are using and their plans. It has become a competitive differentiator to be a tech leader in the face of increasing competition from digital-first companies disrupting the sector.

Large traditional banks are therefore being forced to rethink the way they operate. Competition from digital challenger banks, many of which are cloud first, is forcing them to hire the services of tech companies like Google and Amazon. These tech giants process enormous volumes of transactions  daily basis and their bread and butter is making online services user-friendly.

Google bank – a bank that is as easy to work with as Google – is seen as the Holy Grail for banks in the digital age. An essential ingredient in this is access to unlimited computing power on-demand through public cloud services, so Google and Amazon have been winning huge deals in the banking sector as a result.