Rakuten Card's 20 Years: From Unknown Challenger to Japan's Largest
Rakuten Card's 20 Years: From Unknown Challenger to Japan's Largest
In July 2025, Rakuten Card celebrated its 20th anniversary. With over 30 million cards issued and an annual shopping transaction volume exceeding 10 trillion yen, it now stands at the pinnacle of Japan's credit card industry. However, back in 2005, when it was founded, few could have predicted this outcome. So, how did Rakuten Card achieve such growth? Let's trace its trajectory.
A voyage that began with a clash of cultures
The birth of Rakuten Card was triggered by Rakuten's acquisition of Kokunai Shinpan, a consumer finance company based in Kyushu. However, these two companies were contrasting organizations in every respect. Kokunai Shinpan was a long-established firm operating on a traditional consumer loan model. Rakuten, on the other hand, was an e-commerce company growing rapidly on the tailwinds of the internet's expansion. It started as an unprecedented challenge: merging two organizations with completely different cultures, business models, and values. At the time, the Japanese credit card industry was dominated by so-called "status cards." In an era where companies competed to highlight luxurious benefits and strict membership requirements, Rakuten Card chose the exact opposite path: a direction of being "simple and accessible to everyone." In Japan, where credit cards were not yet a part of daily life, this was also a major gamble.
Two crises that stood in the way shortly after founding
The path ahead for Rakuten Card was by no means smooth. First, after the acquisition of Kokunai Shinpan, the existence of a large amount of uncollected debt came to light. This was a serious problem that shook the foundation of the business. Rakuten Group Chairman and CEO Hiroshi Mikitani acted quickly, gathering all employees to explain the situation frankly. Afterward, an organizational effort began to set collection targets and regularly report on progress. Through this thorough discipline, the collection rate steadily improved. Next came a major shift in the regulatory environment. In 2006, the Japanese government implemented legal reforms including the abolition of "gray zone interest rates." This forced many financial companies to handle large refunds and record losses. For Rakuten Card, just one year after its founding, strengthening capital became an urgent task. Furthermore, in 2010, regulations on consumer finance were further tightened, including the lowering of borrowing limits and stricter compliance requirements. Rakuten used this as an opportunity to significantly transform its business structure, concentrating management resources on the online credit card business. This became the prototype for today's Rakuten Card.
The difficult challenge of getting people to use it
Rakuten Card's initial strategy was simple: no annual fee and one point for every 100 yen spent. It was designed to naturally appeal to users of Rakuten Ichiba to use a card under the same Rakuten brand. Since millions of people were already visiting Rakuten Ichiba, it was an ideal environment to trigger card applications.
However, encouraging applications and getting people to actually use the card are two different things. Many people hold cards but do not use them when it comes time to shop. This is a challenge faced by many card companies. Rakuten Card tackled this by promoting usage centered on points. By combining limited-time point campaigns and bonus points for specific usage scenarios, they instilled a sense that "the more you use it, the more you save." Eventually, Rakuten Card transformed from a mere payment method into a vital presence supporting Rakuten Ichiba's sales. Investment in technology was also proactive. Rakuten Card was one of the first credit card companies in Japan to introduce a smartphone app, creating an environment where users could easily check their usage statements. It is also worth noting that they positioned the call center not as a cost department, but as a core function for building trust with customers. The philosophy that "long-term customer relationships are born from trust and sincere service" was in the background.
The landscape changed by Rakuten Cardman
For a long time, Rakuten Card's growth relied on existing users of the Rakuten ecosystem. The turning point came in 2013 with the birth of a character. The TV commercial featuring talent Jay Kabira as "Rakuten Cardman" was intentionally simple in its composition. However, its effect was immense, and Rakuten Cardman quickly became widely known. Coupled with generous sign-up benefits, they succeeded in attracting segments that had never used Rakuten services before. Attracting customers from outside the ecosystem was the moment Rakuten Card stepped into its next stage.
The "glue" that binds the ecosystem
The next challenge after acquiring new customers was guiding them to other Rakuten services. The "SPU (Super Point Up Program)," which started in 2016, was the core initiative for this. The mechanism was clear: the more Rakuten services you use, the higher your point multiplier becomes. Users who met the conditions could earn up to 18 points for every 100 yen spent on Rakuten Ichiba. In this program, Rakuten Card functioned most easily as an entry point. For many users, it became established as a "reliable card where points never stop," and it also plays a role in promoting cross-use with financial services such as Rakuten Bank, Rakuten Securities, and Rakuten Insurance. The effect is reflected in the numbers. In five years, the number of Rakuten Bank accounts doubled, and cross-use between Rakuten's financial services also doubled. Rakuten Card became the "glue" that connects the entire ecosystem.
Domestic top, and then overseas
In 2017, Rakuten Card achieved the number one position in Japan's credit card industry in terms of annual shopping transaction volume (based on a press release dated January 31, 2018). In 2020, annual transaction volume exceeded 10 trillion yen. As of 2023, the number of domestic cards issued has exceeded 30 million. Overseas expansion is also progressing. Rakuten Card, which launched its service in Taiwan in 2015, has established its position as a "travel card" due to its high cashback rate and convenience for travel to Japan. Currently, they are working on more personalized programs, premium benefits, and diversification of designs to acquire younger generations. However, at its root is the same philosophy as when it was founded: "simple and easy for anyone to use."
What 20 years teaches us
Rakuten Card's 20 years is not just a history of a card company's growth. It is a story of the results of continuing to pursue what users truly want without being bound by industry common sense. There was a time when the "obvious" proposal of no annual fees seemed novel. The idea of enriching life through points has come to raise the value of the entire ecosystem. "Deeply understanding what people want from a credit card and linking it to the ecosystem's strategy"—this consistent stance can be said to be the driving force that pushed Rakuten Card to the top.
Personal views and reflections: The view beyond overcoming the clash of cultures
Voices saying "it shouldn't work"
In 2005, when Rakuten acquired Kokunai Shinpan, many industry insiders must have been skeptical. An internet company buying a credit and retail finance company. That alone is a strange combination, but that wasn't the only problem. Kokunai Shinpan was a traditional financial institution based in Fukuoka City with a culture of seniority and a focus on face-to-face interaction. Rakuten, on the other hand, was a technology company that was unique even at the time, valuing speed and numbers. The values were different. The decision-making styles were different. Even the definition of "success" must have been fundamentally different. Such clashes of different cultures are one of the factors that cause the most failures in corporate mergers and acquisitions. As many studies and papers, including those by McKinsey, have repeatedly pointed out, most M&A failures are caused by cultural friction rather than financial problems. If so, the fact that Rakuten Card became one of Japan's top credit cards in terms of self-issued shopping transaction volume 20 years later is not just a business success. It feels like a rare example showing "what lies beyond overcoming a clash of cultures."
Why do clashes happen?
First, I would like to pause and think: what is a "clash of cultures" in the first place? It is often misunderstood, but a clash of cultures does not happen because one culture is "bad." It is the opposite. It is a phenomenon that occurs when the behavioral patterns that each organization has polished to survive in its own environment collide with the logic of a different environment. Kokunai Shinpan's "caution" and "focus on face-to-face interaction" were wisdom accumulated over decades in the high-risk business of credit and consumer loans. If you neglect risk management, bad debt will swell. If the relationship of trust with customers collapses, the repayment rate will drop. It is a culture acquired precisely because they knew such pain. On the other hand, Rakuten's culture of "valuing speed," "data-driven," and "encouraging challenges" was polished in the competitive environment of internet business. In the internet world, if decision-making is delayed by a week, you lose the market. Rather than caution, setting hypotheses and testing them quickly was a survival strategy. Both were "correct" cultures in their respective contexts. That is why they collided.
Crises melted the culture
What is interesting is that the integration of culture at Rakuten Card progressed not during smooth times, but during crises. The large amount of uncollected debt that became clear after the acquisition. The wave of "gray zone interest rate" abolition that followed. And the full enforcement of consumer finance regulations in 2010. Rakuten Card's founding period was like a voyage in a storm. In the face of such crises, it is said that the management team, including Chairman Mikitani, took a stance of sharing collection targets and progress across the entire organization. While the detailed circumstances are difficult to verify from the outside, it is widely known as an internal culture that the Rakuten Group has valued company-wide information sharing mechanisms such as "morning meetings." Not "hiding problems" but "facing them together." Not a binary opposition of "headquarters and the field," but "fighting as one team." This stance lined up people with different cultures in front of a common enemy (namely, uncollected debt and stricter regulations). Psychologically speaking, "common difficulties" are one of the strongest catalysts for increasing group cohesion. When dealing with external threats is prioritized over internal cultural conflicts, people focus on "what should be done now" rather than "where they came from." Could it be that the series of crises for Rakuten Card ironically functioned as a catalyst to accelerate cultural integration?
What was born beyond overcoming it: "Hybrid strength"
An organization that has overcome a clash of cultures is not "unified" into one or the other. In successful cases, the two cultures mix, and a "hybrid strength" is born that could not have been created by either alone. In the case of Rakuten Card, it is very clearly visible.
Solidarity as a financial institution x experimental spirit as a technology company
The fact that they were one of the first credit card companies in Japan to introduce a smartphone app is likely a product of Rakuten's digital culture. In 2010, they provided an iPhone-compatible app ahead of the industry, and released an Android version the following year (both announced by the company). At the same time, however, the idea of positioning the call center as a "core function for building trust rather than a cost department" is, I think, a translation of the value of "relationships with customers" that Kokunai Shinpan had cherished for many years into the digital age. The precise design of the point program is similar. The simple structure of "100 yen = 1 point" embodies the transparency and clarity typical of Rakuten. On the other hand, the accumulation of complex point multipliers in the SPU (Super Point Up Program) is a precise design based on risk and return calculations unique to financial services. This combination could not have been born from a simple technology company or a simple financial institution alone.
The depth of being simple
I would like to point out one more thing that is often overlooked. The "simplicity" that Rakuten Card has consistently pursued sounds like a matter of course at first glance. However, in reality, I feel it is extremely difficult for a large company to "remain simple." This is because the larger an organization becomes, the more the dynamics of wanting to make things complex work. The sales department wants to increase benefits. The marketing department seeks differentiation. The risk management department wants to make conditions more detailed. Even though each is acting from correct motives, before you know it, a complex product is born where "you don't know who the card is for." This is a pattern of failure that has been repeated in every industry, not just the Japanese financial industry. In contrast, the fact that Rakuten Card has continued to protect "permanent annual fee free" and "simple point returns" must have been a quite willful choice. Perhaps they did not waver because they had an axis of protecting the core part of the product even while different cultures were mixing. What created that axis? Perhaps it was the answer to the simple question of "what do customers really need?" that the two organizations shared through crises.
Thinking in the context of Japanese society
I would like to broaden my perspective a little here. The meaning of Rakuten Card's insistence on "simplicity" and "ease of access" can be seen more deeply when read in the context of Japanese society. Back in 2005, the credit card ownership rate in Japan was already at a reasonably high level. However, "owning" and "using daily" are different things. The ratio of cashless payments was still low, and in my personal experience, when I tried to use a card, the existence of annual fees and complex benefit systems were hurdles. For me, it was an era of "I have it, but I don't use it for some reason." Rakuten Card may have created an "entry point that is easy to use" there. It is not just a market development strategy. It has a greater meaning of rooting credit cards in daily life as a more familiar payment method. What Kokunai Shinpan had been facing for many years was precisely "people who are not used to mastering financial services." When that business sense, the sense of "making something that ordinary people can use naturally," was combined with Rakuten's digital reach, I think the "door that anyone can enter" called Rakuten Card was born.
What is the view beyond overcoming it?
Ultimately, what I see as the view beyond overcoming the clash of cultures is the following: the birth of a new identity that cannot be reduced to either culture. Rakuten Card is now neither "Rakuten's card division" nor "Kokunai Shinpan's successor." It is a single completed entity with its own brand, its own philosophy, and its own customer base. The character Rakuten Cardman symbolizes exactly that, and it has become an entity recognized as an independent brand regardless of whether it is inside or outside the ecosystem. And the expansion into Taiwan. The expansion in Taiwan, where they established a local subsidiary in 2014 and started applications and issuance in 2015, is also one of the views beyond overcoming it. Organizations with experience in cross-cultural integration may also have high adaptability to new environments. The fact that Rakuten Card has established a position in Taiwan with high cashback rates and convenience for travel to Japan as its strengths is perhaps because the stance of asking "what do local customers really need?" was engraved in the organization's DNA.
Clash is an asset
A "clash of cultures" is often spoken of as a problem. However, when looking back on Rakuten Card's 20 years, couldn't it be said that the clash was the greatest asset? Without the clash, there would have been no questioning. Without questioning, there would have been no opportunity to face the core question of "what is a truly simple card that anyone can use?" The answer to that question created a credit card that stands at the top of Japan in terms of self-issued shopping transaction volume. Different things meet, collide, and mix. The process is painful, but beyond overcoming it, a view that could never have been seen by either alone is spreading. Rakuten Card's 20 years is a story that proved the beauty of that view with numbers.
Japan’s favorite credit card turns 20
https://rakuten.today/blog/japans-favorite-credit-card-turns-20.html
