TOKYO: Japan Post Bank will abolish its “mijica” cashless payment card service due to many security flaws and launch a new service around spring 2022, its President Norito Ikeda said Friday.

Ikeda also announced that he will voluntarily return 10 pct of his monthly pay for three months to take responsibility for fraudulent transfers of customer deposits using the mijica service.

“We apologize to our customers for causing inconvenience and trouble as we failed to conduct customer-oriented operations, including those related to compensation payment,” he said.

To clarify the management team’s responsibility, four other executives of the Japan Post Holdings Co. unit will also return their remuneration.

Until the launch of the new service, the bank will offer the mijica service with available card functions limited to ones that have proved safe, including as a debit card.

In addition, it will resume customers’ money transfers to “Merpay” of online flea market operator Mercari Inc. and “Line Pay” of free messaging app provider Line Corp. on Wednesday. It will also enable money transfers to other partnered payment service systems, such as “Docomo Koza” of major mobile phone carrier NTT Docomo Inc., in stages.

The bank noticed the first fraudulent money transfer in summer 2017. It did not, however, start making proper responses, such as taking full-fledged security measures and offering compensation, until autumn 2019.

“I was informed of individual cases but I wasn’t able to grasp the whole picture,” Ikeda said.

Then he revealed plans to start building a one-stop system to receive complaints and inquiries this month and to strengthen its senior officials’ commitment to work to pay compensation and respond to complaints.

The bank had compensated for confirmed losses totaling 52.77 million yen for 230 cases as of Thursday.

JIJI Press