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FinTech and PaymentsFrom diagramming the flow of funds and determining regulatory applicability to reviewing payment service provider contracts, our attorneys handle every step.

Free consultation Why LegalAgent
Response time
1 business day*
First consultation
30 min free
Scope
Prepaid instruments · Funds transfer · Payment collection · Points

* As a rule, for contract reviews and routine legal questions. For complex or urgent matters we propose a schedule that fits the matter.

Client companies served*

150+

Selected clients shown, in no particular order. * Clients and partners. Not limited to FinTech and Payments matters.

KADOKAWA FRONTEO YAMAP ACROVE LAPRAS AVA Intelligence OPTIEUM Biotechnologies ReDelta Concrew LINEA Innovations TECHSUITE YStory

Diagramming the flow of funds to sort out which regulations apply

Whether a payment, remittance or point service is regulated can depend not on what the service is called but on the receipt of funds, the retention period, whether funds are remitted and whether refunds are available. We diagram the flow of funds and then determine whether the service may fall under prepaid payment instruments, funds transfer or payment collection agency. We also review payment service provider contracts in light of which party actually bears the risk of retained funds and chargebacks in practice.

  • You cannot tell whether top-up points are prepaid payment instruments
  • You want to confirm whether user-to-user transfers are funds transfer business
  • What you set up as payment collection agency may go beyond its scope
  • You adopted a payment service without checking the provider contract's terms

Why LegalAgent

With LegalAgent, you can work through regulatory issues at the business planning stage

We support the launch of payment and remittance services in three ways: fast answers, fees you know before we start, and analysis that weighs both registration or notification and scheme changes.

  1. 01Speed

    Typical law firms3–5 business days

    LegalAgent1 business day, as a rule

    Applicability checked before development gets far

    We answer contract reviews and routine legal questions within one business day as a rule. Because the design can change whether regulation applies, you can consult us before the specifications are fixed.

  2. 02Fees

    Hourly billingTotal unknown at the start

    LegalAgentScope and fee set before we start

    The fund flows in scope and the fee, decided first

    We ask about the types and number of fund flows to review and whether the review should cover the need for registration or notification, and give you an estimate before we start. Matter-based work is generally on a fixed fee.

  3. 03Options

    • Regulatory applicability table
    • Scheme comparison table
    • Response policy memo

    Both paths shown: registration or notification, and scheme changes

    Even where regulation may apply, we do not assume registration or notification is the only path; we also consider whether changing part of the scheme can avoid it.

* Response times are for contract reviews and routine legal questions; they vary by matter.

How it works

The AI Agent maps the flow of funds; attorneys decide what applies

The AI Agent maps the flow of funds from specifications and flow diagrams and prepares drafts; attorneys decide whether the service may fall under prepaid payment instruments, funds transfer or payment collection agency.

AI Agentdoes the work

  • Maps top-up, holding, transfer and settlement flows from specifications
  • Draws on past analyses and templates
  • Drafts revisions to terms of use and contract clauses

Attorneysmake the judgment

  • Decide whether prepaid payment instrument, funds transfer or payment collection agency rules apply
  • Decide whether a scheme change can avoid applicability
  • Take responsibility for the final memo and response policy
ConsultationMemo and revisions delivered
  1. STEP 01Reviewing the flow of funds and the business scheme

    We review the receipt of funds, the retention period, whether funds are remitted and whether refunds are available, and organize the issues needed to consider regulatory applicability

    Policy for considering regulatory applicability

  2. STEP 02Organizing regulatory applicability and scheme change options

    We analyze which of prepaid payment instruments, funds transfer, payment collection agency and points may apply, and consider this together with scheme change options to avoid applicability

    Regulatory applicability memo and issues for comparing schemes

  3. STEP 03Considering a response policy for registration and notification or scheme changes

    We consider the response policy where registration or notification is required, or the feasibility of avoiding applicability through scheme changes, collaborating with outside experts well versed in financial regulation where necessary

    Response policy memo and draft expected schedule

  4. STEP 04Reflecting results in contracts and terms of use

    We review the contract terms (retained funds, chargebacks, handling upon termination and the like) and the content of the terms of use, and identify points that need revision

    Contract review comments and draft revisions to the terms of use

  • Attorneys make the final callAn attorney checks every deliverable and takes responsibility for it.
  • Your inputs are not used to train AIOn top of attorneys' statutory duty of confidentiality, we work in an environment where your inputs are not used to train AI.
  • An AI Agent built in-houseOur own engineers develop it. Information Security Policy

Use cases

Common requests and what you receive

From the design stage of the flow of funds to the review of contract terms, we set out our support and deliverables for each starting point of a consultation.

  1. 01

    You want to add a top-up point feature to your service but do not know whether it is a prepaid payment instrument

    If left aloneDevelopment proceeds on a mistaken judgment of applicability, and just before release it is too late to deposit the issuance security deposit or meet display obligations

    What we doWe review how points are issued, whether they are issued for consideration, their validity period and whether refunds are available, and assess whether they constitute prepaid payment instruments

    What you receive
    • Regulatory applicability memo
    • Draft scheme revision
    • List of response policies if regulation applies

  2. 02

    You want to confirm whether a feature that intermediates money between users constitutes funds transfer business

    If left aloneThe service launches without knowing that the mechanism requires funds transfer business registration, and the user base grows while carrying the risk of operating without registration

    What we doWe review the design of receipt of funds, applicability as exchange transactions and the retention period, and organize the applicability of funds transfer business and scheme change options

    What you receive
    • Applicability memo
    • Draft scheme changes (including avoidance of applicability)
    • Points to reflect in the business plan

  3. 03

    You want to design a new payment collection agency or escrow scheme

    If left aloneManaging funds beyond the scope of payment collection agency brings the scheme under funds transfer business or prepaid payment instrument regulation

    What we doWe review the purpose of collection, the period for which funds are held and the contractual relationship with users, and consider the extent to which the scheme can be structured as payment collection agency

    What you receive
    • Scheme memo
    • Draft provisions for the terms of use and outsourcing agreement
    • Internal explanatory materials

  4. 04

    You want to review contract terms with a payment service provider (retained funds, chargebacks and handling upon termination)

    If left aloneStarting operations without reviewing the contract terms leads to unfavorable treatment regarding the return of funds upon termination or the burden of chargebacks

    What we doWe review the contract's terms on how retained funds are managed, fees, who bears chargebacks and the settlement of funds upon termination

    What you receive
    • Contract review comments
    • Summary of negotiation priorities
    • Internal explanatory materials

  5. 05

    You want to confirm at the business planning stage whether notification to or registration with the Financial Services Agency is required

    If left aloneThe need for a regulatory response becomes clear only after the business plan is finalized, and revisions to the release date and the required internal structure fall behind

    What we doWe review the flow of funds in the business plan and the relationship with users, and organize the likely direction of the regulatory response

    What you receive
    • Regulatory issue memo
    • Points to reflect in the business plan
    • Draft expected schedule

Scope of our FinTech and payments support

We cover everything from diagramming the flow of funds to determining regulatory applicability, considering a response policy and reflecting it in contracts and terms.

Reviewing the flow of funds and regulatory applicability
We look not at the name of the service but at how funds are actually received, held and remitted.
  • Diagramming the flow of funds
  • Assessing applicability for prepaid payment instruments, funds transfer, payment collection agency and points
Scheme design and considering a response policy
We consider both the response policy if regulation applies and scheme change options to avoid falling under regulation.
  • Considering scheme change options to avoid falling under regulation
  • Organizing a response policy where registration or notification is required
Developing contracts and terms
We review contracts with payment service providers and merchants and the terms for users against the actual flow of funds.
  • Reviewing contract terms with payment service providers and merchants
  • Developing terms of use and user-facing explanations

Our approach

What we focus on in FinTech and Payments

In FinTech and payments legal matters, we focus on the following perspectives.

  1. 01

    Reviewing from the actual flow of funds rather than the service name

    We think that the regulatory applicability of payment, remittance and point services can change not according to their name or the look of their UI, but according to the actual flow of funds: the receipt of funds, the retention period, whether funds are remitted and whether refunds are available. We review not only business description materials but also a diagram of the flow of funds.

  2. 02

    Presenting both a registration and notification response and scheme changes to avoid applicability as options

    Even where we find that regulation may apply, we do not assume registration or notification is the only path; we also consider whether changing part of the scheme can avoid applicability, and present options suited to your business plan.

  3. 03

    Reviewing contract terms with payment service providers and merchants against actual operations

    We review how retained funds are managed, who bears chargebacks and the terms for settling funds upon termination not only on the wording of the contract but also in light of which party will actually bear the risk in practice.

  4. 04

    Collaborating with outside experts well versed in financial regulation where necessary

    Where detailed confirmation of registration and notification requirements or dealings with the authorities are needed, we collaborate with outside experts well versed in financial regulation, depending on the nature of the matter, in a way that does not stall the business.

Pricing

FinTech and payments fees

Regulatory applicability checks and contract reviews for payment, remittance and prepaid schemes are estimated after hearing about the complexity of the flow of funds and the scope of review.

How fees are set

Scope and fee agreed before we start

Matter-based work is generally on a fixed fee. For complex or urgent matters, we propose a schedule and an estimate that fit the matter.

First consultation

A free 30-minute online meeting.

You can come to us before your documents are in order. Tell us what you know so far.

Free consultation

What we check before quoting

  • The types and number of flows of funds to be reviewed (payments, remittances, points, payment collection agency and the like)
  • Whether the review covers only contracts or also related materials such as business plans and specifications
  • Whether to include consideration of the need for registration or notification, or to stop at analyzing regulatory applicability
  • Whether collaboration with outside experts well versed in financial regulation is needed
  • The expected number of negotiation rounds on contracts with payment service providers and merchants

The required scope of work differs depending on the types of flows of funds reviewed and the complexity of the scheme, so we present an individual estimate after hearing about your matter.

Team & Record

Attorneys who know business practice handle your matters

Contract reviews and drafts
2,000+
Client companies
150+
Startup legal matters
200+
Financing matters
65Since 2024, issuer and investor side

* Approximate figures based on matters handled by our firm; actual figures vary by matter.

Engineers

Shinya Makita and Sota Miya build our product on the same team as the attorneys.

Practical guides to FinTech and payments law

Prepaid payment instrumentsDo Your Company's Points or Coins Fall Under the Payment Services Act? What to Decide Before Designing Them

This column examines the conditions under which your company's points or coins constitute prepaid payment instruments, looking at the distinction between paid and free issuance, validity periods, places of use, unused balances, and the design of refunds and transfers.

Related practice areas

FAQ

Frequently asked questions

Can we consult you just on whether our service is a prepaid payment instrument?

We also handle consultations limited to confirming applicability. Based on materials showing the specifications of the point or top-up feature, we review whether value is issued for consideration, the validity period and whether refunds are available.

Can we consult you from the business planning stage on whether funds transfer business registration is required?

You can consult us from the early stage of business planning. Because the conclusion can change depending on the design of the receipt of funds and applicability as exchange transactions, confirming at an early stage is likely to be effective.

Can we also consult you about scheme changes to avoid registration or notification?

Even where we find that regulation may apply, we consider not only a response through registration or notification but also whether changing part of the scheme can avoid applicability.

Can we engage you only to review a contract with a payment service provider?

We also handle consultations limited to contracts. We focus on how retained funds are managed, who bears chargebacks and the terms for settling funds upon termination.

Do you also handle services relating to Web3 and crypto-assets?

Consultations centered on designs specific to web3, such as tokens, NFTs and DAOs, are handled on the Web3 page. This page focuses on Payment Services Act issues for payments, remittances, prepaid instruments and the like premised on fiat currency.

Can we also ask you to collaborate with financial regulation experts?

Depending on the nature of the matter, where detailed confirmation of registration and notification requirements or dealings with the authorities are needed, we collaborate with outside experts well versed in financial regulation.

Can we consult you if all we have is a business plan?

We can begin with only a business plan. If you also provide materials showing the flow of funds (flow diagrams, specifications and the like), a more precise review becomes possible.

Can we also consult you about personal information protection or SaaS terms of use?

Our focus here is on confirming regulatory applicability for payments and remittances and reviewing contracts. For personal information protection in general, please also see the Data Privacy page, and for general SaaS terms of use and development contracts, the IT, SaaS and System Development page.

Contact

Talk to us about your payment or remittance scheme

Whether you are still considering the service or have not yet fully mapped the flow of funds, you can consult us based on the information you have at this point.

  • A free 30-minute online first meeting
  • You can consult us before the flow of funds is fully mapped
  • We can check prepaid payment instrument applicability alone