JICA adopts Loan IQ to boost private sector lending in Japan
Finastra has announced that the Japan International Cooperation Agency (JICA) has successfully gone live with the Loan IQ platform for its private-sector investment finance operations.
The project represents the first implementation of Loan IQ in Japan, with the deployment undertaken by IBM Japan. JICA is aiming to modernise its core system to support an expanding initiative that provides loans to private sector projects in developing countries.
JICA is Japan's main agency responsible for Official Development Assistance, offering long-term concessional financing to infrastructure and social projects in developing countries. As challenges in these markets have become more complex, JICA has sought to strengthen its systems to better accommodate the growing demand for private-sector investment finance schemes.
The new platform enables end-to-end management of international private sector loan transactions and supports multiple currencies, including Japanese yen, US dollars, euros, and local currencies. The expectation is that the system will enhance operational efficiency and accuracy while preparing JICA for future expansion of its private-sector investment operations.
"We expect that this transformation will strengthen our ability to mobilize private capital for development, and to support increasingly diverse financial structures, enhancing the foundation of JICA's private sector operations," said TAKETSURU Eiko, Director of Information System Division 2, Information System Department at JICA.
Loan IQ brings a unified management approach to the lifecycle of loan products, covering transaction setup and approval, disbursement, interest and fee calculation, and final repayment. The system is used by commercial and development banks around the world, aligning with global standards for compliance and scalability.
Finastra indicated that this latest deployment in Asia-Pacific is a reflection of Loan IQ's capabilities and its adoption by development finance institutions globally. The company also highlighted the partnership with IBM Japan, who took on the role of implementation partner by providing development, data migration, user training, and ongoing operational support.
A spokesperson from Finastra said the system would contribute directly to JICA's core operations.
"JICA plays a critical role in advancing sustainable development in emerging market. We're proud that Loan IQ now powers JICA's private sector lending operations, enabling it to streamline processes and scale impact in line with its mission," said Andrew Bateman, EVP for Lending at Finastra.
IBM Japan's expertise in public-private finance was cited as a factor in the successful rollout. The company worked closely with JICA to ensure that the transition to the new platform met operational requirements and regulatory standards.
Key benefits identified with the new system include streamlined operations, reducing manual workloads through a unified platform, flexible product design that caters to diverse and changing lending structures, and compliance with global standards for financial operations.
The implementation of Loan IQ is expected to equip JICA with scalable and adaptable lending management capabilities. This aligns with its goal of attracting greater volumes of private capital to aid development projects in emerging economies.
