Efforts to abolish the use of name seals, called hanko, are accelerating in the financial sector amid the spread of the novel coronavirus.
Such moves have gained speed as customers have begun to realize the convenience of an electronic signature system, which allows them to complete procedures for loans and other contracts from home.
Sumitomo Mitsui Banking Corp. saw the number of loan contracts signed electronically reach about 2,000 in April this year. The electronic service was introduced in 2016, but the number of such contracts stood at about 1,000 in April 2019. The figure doubled over the past year. People, such as corporate teleworkers in charge of financial transactions, appear to have increasingly used the system amid the pandemic.
Since April, Mitsui Sumitomo Insurance Co. has made it possible for corporate policyholders to use the signatures of their representatives instead of hanko seals when they claim insurance money. Currently, this is temporary, but the company is considering making it permanent.
Financial institutions have taken the lead in doing away with hanko seals since before the coronavirus outbreak. Major banks, in particular, have allowed the use of electronic signatures and introduced a system that allows individual customers to open new accounts without seals. Joyo Bank based in Mito also launched a new system this month in which hanko seals are not necessary to confirm the identity of customers for some account transfers.
On the other hand, regional banks have lagged behind in efforts to allow the use of electronic signatures, which require systems that take time and expense to build.
A person familiar with the sector also said, "Demand for contracts and procedures using hanko seals remains strong among companies and elderly customers."
On Tuesday, the Financial Services Agency set up a study group with the financial industry to discuss ways to remove the hanko system. The agency intends to clarify problems in business practices and systems and move to revise a relevant law if necessary.
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