ZENGIN SYSTEM

─ The Zengin Data
Telecommunication System ─Japanese Banks’ Payment Clearing Network
Issued: December 2019Japanese Banks’ Payment Clearing NetworkZENGIN SYSTEM

History and Role

Infrastructure for Japan’s Economic Transactions■ Table 2: Inter-bank Payment Systems in Japan
Operation Commencement
Zengin Data Telecommunication System(Zengin System)

Apr. 1973(Joint system)
Zenshinkin System
Data Transmission System for Credit Cooperatives
Central Network System for Labour Banks
Agricultural Cooperative Savings Network Service
Clearing Houses(operated by 107 local clearing houses)

Foreign Exchange Yen Clearing System(using BOJ-Net)

daytime on weekdays, is supplemented by the “MoreTime System,” which supports transfers at nighttime
on weekdays, weekends, and holidays, realizing
Zengin System operations on a 24/7 basis.
The 7th Generation Zengin System, launchedin November 2019, inherits the functions andconfiguration of the 6th Generation Zengin System(including the More Time System). Steps are being
taken to enhance safety and reliability by raising
capacity and processing performance, strengthening
cybersecurity measures, and reducing power
consumption (see page 14).
In addition, in December 2018 the Zengin EDI
System (ZEDI), which allows various type of EDI
information (payment notification numbers, invoice
numbers, etc.) to be attached to transfer messages
between companies, was built and launched.

The Zengin Data Telecommunication System (Zengin
System) is an online network that links financial
institutions nationwide through computers andtelecommunication lines and processes transfer
messages arising from remittances and othertransactions. The Zengin System also handles thedaily settlement of inter-bank credit/debt relationshipsthat result from these transactions.
The Zengin System was launched in April
1973 and now includes almost all deposit-taking
financial institutions in Japan (see Table 1). It plays
a crucial role as the basic infrastructure for Japan’s
economic transactions, processing a daily average ofapproximately 6.5 million transfer messages for credit
transfers and other transactions exceeding 12 trillion
yen (see Table 2).
Since October 2018, the “Core Time System,”
which supports fund transfer transactions during

Dec. 1879(Osaka Clearing House)
Dec. 1887(Tokyo Clearing House)

Clearing of bills,
checks and otherinter-bank receipts

Mar. 1989
Oct. 1988

CD/ATM Networks(Integrated ATM Switching Service)

Feb. 1990 (MICS)*Changeover to RTGS in Jan.
2001

*CD/ATM online network
services between banks
started in 1980

1943
Aug.

1958
Jun.

1968
Jul.

1973

Apr.

Feb.

Apr.

Commencement of the Chigin (regional banks)
Data Telecommunications System.
Revision of the fund transfers settlement system
In order to facilitate exchange of transfer notification slip, 27 Fund Transfer
Offices were established in the regionally-based bankers associations.
Implementation of the centralized settlement of domestic fund transfers at the Bank of Japan.

1

Aug.

11*1
0.3*1
1.6*1
20*1

303

(nationwide)261(Tokyo)124

Clearing of foreignexchange-related
yen funds

201

7

4,226

Fund transfers between
current accounts heldat the Bank of Japan

502

16

35,998(Tokyo)Cash withdrawals
Balance inquiries
Account verification
prior to credit transfersfrom ATMs

Upgrade of the Zengin System (6th generation)(1,371 financial institutions with about 32,515 branches participating in the system)

MICS (Multi Integrated Cash Service
inks the following networks.)
BANCS (city banks)
ACS (regional banks)
SOCS (trust banks)
LONGS (long-term credit banks andShoko Chukin Bank)SCS (member banks of the Second
Association of Regional Banks)
SNCS (shinkin banks)
SANCS (credit cooperatives)
ROCS (labour banks)
Agricultural Cooperative Net Service

757*2

11*2

Inplementation of Zengin EDI System(starting with 321 participating financial institutions)Operations were transferred to the Japanese Banks’ Payment Clearing Network.
Payment Services Act was enacted.
Implementation of same-day settlement.

Foreign banks operating in Japan joined
the Zengin System for the first time.

1982

19*1
0.3*1
2.6*1
10*1

Inplementation of More Time System(realizing Zengin System operations on a 24/7 basis)(starting with 504 participating financial institutions)

Upgrade of the Zengin System (2nd generation)
Sogo (mutual) banks, shinkin banks, the Norinchukin
Bankand some other financial institutions joined(708 financial institutions with about 18,000 branches
participatingin the system).

1979

262
145
14
713

2,881

Notes
*1 Figures show the transaction volume and value within each joint system. These are not included in the figures for the Zengin System.
*2 Figures show both intra-group and inter-group transactions.
Source: Japanese Bankers Association, Settlement Statistics, etc.

Establishment of the Domestic Fund Transfer System
The Zengin System commenced its operation(87 banks and the Shoko Chukin Bank, with about 7,400 branches participating in the system).

1984

1,614

Value
(trillion yen)(nationwide)
51(Tokyo)16

Jan. 2004 (Integrated ATM
Switching Service)■ Table 1: History of the Japanese Domestic Fund Transfer System of ZenginTokyo Fund Transfer Office(This office was closed on April 18, 1973.)

Volume (million)

1,274
Fund transfers
such as credit
transfers,
remittancesand collections

Oct. 1976
Nov. 1982
Jan. 1984
Feb. 1984

BOJ-Net Funds Transfer System(BOJ-Net)

Transactions (2018)

Participants(as of December 31, 2018)

Types of Payment

1987

1993

1994

Mar.

Jan.

1995
Nov.

2001

2003
Nov.

2009
Jan.

2010
Apr.

2010
Oct.

2011
Nov.

2018

2018

Oct.

Jan.

Japan Post Bank joined the system.

Dec.

2019
Nov.

Upgrade of Zengin System (7thgeneration)(1,229 financial institutions with about
30,900 branches in the system)

Nov.

Upgrade of the Zengin
System (3rd generation)(5,304 financial institutions
with about 42,000 branches
participating in the system)
Credit cooperatives, labour banks, agricultural
cooperatives and some other financial institutions
joined(5,479 financial institutions with about 40,000
branches participating in the system).

Upgrade of the Zengin System (5th generation)(1,679 financial institutions with about 37,250 branches participating in the system)

Implementation of the New Domestic Fund Transfer System (ccp scheme).
Upgrade of the Zengin System (4th generation)
Trust banking subsidiaries of security companies joined the system(3,552 financial institutions with about 44,800 branches participating in the system).
Revision of the Sender Net Debit Cap Scheme, which was first implemented in July 1990.

The 7th Generation Zengin System initiation
ceremony is held (November 5, 2019)

2

ZENGIN SYSTEM

Characteristics of the Zengin System

Nationwide Fund Transfer Network
Almost all deposit-taking financial institutions in Japan,
including banks, shinkin banks, credit cooperatives,
labour banks, agricultural cooperatives and the Japan
Post Bank, currently participate in the Domestic FundTransfer System. The Zengin System was connected
to 1,229 member banks with 30,883 branches as ofthe end of November 2019 (see Table 3).
Shinkin banks, credit cooperatives, labour banks
and agricultural cooperatives are connected to the
Zengin System through their respective joint systems.
The Bank of Japan (BOJ) also participates in the
Zengin System as an associate member.

Management of the Zengin System
The Zengin System is managed by the Japanese Banks’
Payment Clearing Network (hereafter “ZenginNet”) and is developed and provided by NTT DATA
Corporation.
Procedures governing remittances and othertransactions processed through the Zengin System andthe clearing of inter-bank funds that results from thesetransactions are outlined in the rules of the Domestic
Fund Transfer System established by the Zengin-Net.

■ Table 3: Number of Financial Institutions Using the Zengin System(as of the end of November 2019)

Clearing Participants

Agency Participants

Number of Banks

Branches

Number of Banks

Branches

City banks

5

2,210

Regional banks

64

7,750

Trust banks

9466

Foreign banks
Member banks of the Second
Association of Regional Banks

7
39

20
2,868

Shinkin Central Bank

1

14

Shinkin banks

257

7,259

Shinkumi Federation Bank

1

9

Credit cooperatives

144

1,607

Rokinren Bank

1

1

13

606

Norinchukin Bank

1

20

Labour banks
Credit federations of agricultural
cooperatives

32

77

Credit federations of fisherycooperatives

32

140

Others

15

493

608

7,343

Subtotal

143

13,851

1,086

17,032Financial institutions

1,229

Branches

30,883

Total

Agricultural cooperatives

Note: Banks listed under “Others” are Japan Net Bank, Seven Bank, Sony Bank, Rakuten Bank, SBI Sumishin Net Bank, Jibun Bank, AEON Bank, Daiwa Next Bank, Lawson Bank, GMO Aozora Net
Bank, Shinsei Bank, Aozora Bank, Shinhan Bank Japan, Shoko Chukin Bank and Japan Post Bank.

■ Figure 1: Fund Transfer Transactions
Volume18(Unit: 100 million)

New file transfer facility
MT data file transmissions
Telegraphic transfers

Value (Unit: trillion yen)
3,500

New file transfer facility
MT data file transmissions
Telegraphic transfers

3,000

15

2,500
12
2,000
9
1,500
6
1,000

3

0

500

79 83 87 91 95 99 03 07 11 12 13 14 15 16 17 18
Fiscal year

3

0

79 83 87 91 95 99 03 07 11 12 13 14 15 16 17 18
Fiscal year

4

ZENGIN SYSTEM

Domestic Fund Transfer Transactions and the Zengin System

Credit Transfers, Remittances and Collections■ Figure 2: Flow of Domestic Fund Transfers

Bank of Japan(Sender bank)(Receiver bank)

Bank ABank B

Fund Transfer Operation Center/
Mother Branch (Check clearance)

Telegraphictransfers…①

New file transfer
facility…②

New file transfer
facility…②

Zengin Center
By post (Mail transfers)…③

Transfer slips

Bank B

Bank A

Computer Center

Telegraphictransfers…①

Computer Center
Fund Transfer Operation Center/
Mother Branch (Check clearance)

Transfer slips

Exchange transfers…④

Payer

What are domestic fund transfers?
Fund transfers include payments and receipts offunds between individuals and companies that do not
involve cash delivery, and they are intermediated byfinancial institutions.
Fund transfers can be categorized into three types:“Credit transfer,” where funds are credited to thepayee’s account, “Remittance,” where funds are paid
to a payee by means of a bank draft and “Collections,”
where bills and checks are collected on behalf of thepayee and the proceeds are credited to the payee’s
account. All these transactions are conducted bysending and receiving transfer messages between
financial institutions.
Transfer messages can be sent and/or received
through the Zengin System, i.e., by telegraphictransfer and a new file transfer facility; or by post or
check clearing, i.e., document-based transfers (seeFigure 2).
5

Branch Payer’s account xchange of transfer messages
Ethrough the Zengin System
Under the Domestic Fund Transfer System, a financial
institution will request another financial institution to
debit an amount into a client’s account by sending atransfer message. The Zengin System’s methods fortransmitting transfer messages can be divided into
two major categories; telegraphic transfers and new
file transfer facility.

● Telegraphic transfers (See ① in Figure 2)

In a telegraphic transfer, member banks can send and/or receive a transfer message for each transaction
through the Zengin System on an online, real-timebasis. There are several types of telegraphic transfer
messages, including credit transfer, remittance,collection and other forms of fund transfer between
financial institutions (see Table 4).

Clearing
House

Branch Payee’s accountPayee

In the case of a credit transfer or remittance,
a financial institution (sender bank) acting on the
instruction of its customer (payer) sends a transfer
message to the financial institution (receiver bank)designated by the customer. In the case of a collection,
the financial institution that has collected a bill/checksends a transfer message to the financial institutionthat has requested the collection.
A transfer message prepared by the sender bank’s
branch is sent to a Zengin Center via processing
computers and the Zengin RC (relaying computer)in the bank. The Zengin Center checks the content of
the message and the amount of the transaction, etc.,
then sends the transfer message to the receiver bank,which credits the amount to the payee’s account inaccordance with the content of the transfer message.

■ Table 4: Types of Telegraphic Transfer Messages
Type
Credit transfer
Payroll transfer

Use
Credit transfers on the day
Post-dated credit transfers
Credit transfers of payrolls and bonuses

RemittanceOrdinary remittances

Remittances in general

Remittances of government payments

Remittances of government paymentsCollection

Payment advices of individual collections
and dishonored collections

Miscellaneous inter-bank transfer
Credit advice

Credit on the day
Post-dated credit

Claim advice

Claim on the day
Post-dated claim
Claim of dishonored collection

Ordinary communication

Communication between banks related todomestic fund transfers

Government transfer

Credit transfers for government payments

6

ZENGIN SYSTEM

Domestic Fund Transfer Transactions and the Zengin System● New file transfer facility(See ② in Figure 2)Document-based transfers
Document-based transfers are used for sending credit
transfers that are not urgent. Transfer methods include
mail transfers and exchange transfers.

● Mail transfers (See ③ in Figure 2)

A sender bank prepares a transfer slip, the standard
form for message transmission, and sends it to thereceiver bank by post. Upon receipt of the transfer
slip, the receiver bank credits the funds to thepayee’s account according to the instructions. Thesetransactions are settled through the Zengin System,
whereby the receiver bank claims the funds by sendinga transfer request to the sender bank via telegraphictransfer.
Mail transfers have been largely discontinued as
their use has declined due to the extra time involved
in sending and receiving transfer messages and thesignificant operational burden placed on financial
institutions in preparing transfer slips.

The operating hours of the Zengin System are shownin Figure 3. On days when traffic is expected to behigh, the operating hours of the Core Time System
may be extended. On the last business day of each

■ Figure 3: Zengin System Operating Schedule by Method of Transmission
7:00

Telegraphic Transfers

New file transfer facility is used for sending andreceiving multiple transfer messages at once.
In addition to document exchanges, post-dated
transfers, and payroll transfers, new file transfer
facility is also dealt with pensions, benefits, andstock dividend transfers, referred to as “transfer agent
operations,” with the focus on transfers that need to beprocessed in bulk on a specific date (Table 5).
Transfer message files sent from financial
institutions are first edited and processed by the
Zengin Center in accordance with transaction types
and receiver banks, and then distributed to the receiverbanks. The receiver banks then credit the funds to thepayee’s account on the designated day.
Due to the mass migration to the new file transfer
facility along with the growth in transaction volumes,
the handling of MT data file transmissions under the
7th Generation Zengin System has been discontinued.

month (excluding the year-end business day), it isextended by one hour.
In addition, in the telegraphic transfer business,
the More Time System is in operation on weekdaynights, weekends, and holidays in order to support
24/7 operations (see Figure 4 for a year trend in fundtransfer transactions).

 perating hours of the Zengin
O
System

8:00 8:30 9:00

Core Time
System *1

More Time
System *2

10:00

11:00

12:00

13:00

14:00

15:00

16:00

start
▼
(30)

end
▼
(30)

end
▼
(30)

start
▼
(30)

17:00

18:00

19:00

20:00

● Exchange transfers (See ④ in Figure 2)■ Table 5: Types of Data for New File Transfer
FacilityType

Use

Document-based transfer

Document-based transfers

Post-dated transfer

Post-dated credit transfers

Payroll transfer
Transfers of payrolls/bonuses
Bonus transfer
Stock dividend transfer

Transfers of dividends to shareholders

Loan-trust dividend transfer

Transfers of loan-trust dividends tobeneficiaries

Benefit transfer frompension trust fund
Benefit transfer from public
pension fundTransfers of benefits to beneficiaries

Benefit transfer from healthinsurance fundStatement for pension
transfer

Statement for transfers of public
pensionStatement for state tax
refund transfer

Statement for transfers of state tax
refundNote
New file transfer facility also deal with data files that do not accompany fund settlements,
such as a list of payments using a bulk payment system and a payee’s account verification.

7

In a similar manner to mail transfers, a sender bankprepares a transfer slip and sends it to the receiverbank through a clearing house. In this case, both thesending and receiving of transfer messages and fundsettlements between banks are processed without
using the Zengin System. For fund settlements
between banks, the payee’s bank claims the funds
against the payer’s bank through the clearing house.
Exchange transfers are used between the branches ofmember banks located within the same district of theclearing house.
Transaction volume of credit transfers by type isshown in Table 6.

■ Table 6: T ransaction Volume of Credit Transfer by
Type
VolumeValue(Unit: ten thousand)(Unit: 100 million yen)

Telegraphic transfer

10,6002,361,727

Core Time System

9,988

2,350,818

More Time System612

10,909New file transfer facility

155

11,513Mail transfer

32

2,622

Exchange transfer

25

2,576

10,813

2,378,438

Type of Fund Transfer

Total
Note
Figures are for December 2018.

start
▼
(30)

New File Transfer
Facility *3

end
▼
(40)

Request/Retrieve administrative documents(00)

Information Server
System(00)

Notes*1 The operating hours for telegraphic transfers (Core Time System) on the last business day of each month (excluding the year-end business day in December) is extended by one hour.
*2 The operating hours for telegraphic transfers (More Time System) is set to overlap with the Core Time System 10 minutes before the start of operations and 10 minutes after the endof communication each business day (weekdays). On Saturdays, Sundays, and holidays, only telegraphic transfers under the More Time System are in operation all day.
*3 The time required for editing and distributing transfer messages of the new file transfer facility varies depending on the amount of data.

■ Figure 4: Fund Transfer Transactions (Telegraphic Transfers / More Time System) (settlement datebase)
Volume (Unit: 10,000)
1,200

Value (Unit: 100 million yen)
18,000Volume (left scale)

Value (right scale)

16,0001,000

14,00012,000800

10,000

600

8,000
6,000

400

4,000

200
0

2,000
October
2018

November December

January
2019

February

March

April

May

June

July

AugustSeptember

08

ZENGIN SYSTEM

Fund Settlement and Risk Management

Settlement at the Bank of Japan and Real-Time Settleme nts for Transactions of 100 Million Yen and Above unds clearing (transactions underF
100 million yen)
Following a remittance transaction, the sender bankpays the funds to the receiver bank.
In the case of transfer messages for transactionsof funds under 100 million yen, the Zengin Center
calculates the net balance of transfers between themember banks and informs the banks as well as theBOJ. The BOJ debits or credits the net balance from/to the current accounts of the Zengin-Net and themember banks at 4:15 pm of the same day.
Settlements for financial institutions such as
shinkin banks, which are indirectly connected to
Zengin Centers through respective joint centers, aremade by the group’s parent financial institution, forinstance, the Shinkin Central Bank for shinkin banks,
which aggregates debits and credits of all its member
financial institutions. Settlements between theaffiliated financial institutions of the parent financial
institution are processed in the group by each intragroup system.
Through this mechanism, the balance of eachcredit/debt relationship that results from a remittancetransaction under 100 million yen between a senderbank and a receiver bank is replaced by a relationshipbetween individual financial institutions and the
Zengin-Net as a central counterparty (see Figure 5).
This limits the settlements of accounts to individual

financial institutions and the Zengin-Net and prevents
impact on other financial institutions in the event of asettlement risk. This method corresponds with “funds
clearing” as laid out by the Payment Services Act, andthe Zengin-Net is licensed by the Prime Minister toundertake a funds clearing business.

 anaging settlement risk in funds
M
clearing
Settlement risk must be controlled to maintain a soundand stable centralized settlement system. Settlement
risk is the risk of a member bank failing to pay thenet balance to other member banks as scheduled, evenafter the amounts have been debited to the payees’
accounts.

● Covering for credit risk

As a settlement risk mitigation measure under the
Zengin System, each member financial institution
posts with the Zengin-Net collateral such as Japanese
government bonds, etc., to provide for the case of a
default on cash settlement.

● Establishment of a system for providing
liquidity

Bank B● Sender Net Debit Cap Scheme

The Zengin System employs the Sender Net Debit
Cap Scheme to control the level of unsettled balance.
Under this scheme, a Zengin Center monitors andmanages the member banks’ net debit amount (theirgross payment minus their gross receipt) to ensurethat it does not exceed the limit declared by each bank.
The net debit cap set for each financial institution
cannot exceed estimated collateral value posted with
the Zengin-Net.
When a member bank sends a transfer message
through the Zengin System, the bank’s debit amountincreases. And when the bank’s net debit resulting
from a transfer is expected to exceed the limit, thetransaction is rejected by the system and returned tothe bank as an error. However, once the bank receives
credits from other member banks and its net debit
decreases, the bank can resend the message.

Bank ABank B
Zengin Center
Small Value
Under 100 million yen

80

50
Transfermessage60

50

Zengin-Net
CCP

30

70

Bank C20

A different process from that previously described
applies to the clearing of large-value domestic
fund transfers of 100 million yen and above (withthe exception of remittances of salary and bonus
payments). Each time a large-value payment is made,a transfer message is sent to the receiver bank after thetransaction has been settled between the sender bankand receiver bank.
The transfer message is kept at a Zengin Center
until each transaction is settled. Funds are clearedfor each transfer message by the BOJ-NET through
RTGS (real-time gross settlement) with liquidity
saving features (see Figure 6).
RTGS does not entail any settlement risks sincefunds are cleared before the transfer message is sent
to the receiver bank. While domestic fund transfers of
100 million yen and above account for less than 0.2
percent of total fund transfers handled by the Zengin
System in terms of the number of transactions, they
nevertheless account for about 70 percent of the total
in terms of amount (as of December 2018).

■ Figure 6: Transaction Flow (RTGS for large-value payments / DNS for small-value payments)40

10 eal-time gross settlements forRfund transfers of 100 million yen andabove

In the event of default, “liquidity providing banks”
contracted with the Zengin-Net provide funds to cover
the net balance(s) of the defaulted bank(s) during the■ Figure 5: F und Settlements through the Zengin-Net as a Central Counterparty (CCP)
Bank A

day and provide final settlement by the end of the day.
The liquidity providing bank is later reimbursed using
the funds recovered from the disposal proceeds of thecollateral posted by the bank in default on the ZenginNet.

Sender bank

60

Relay transfer message
and calculate amounts

Allocation

Large Value
100 million yen and above

TransfermessageTransfer message queued
until after settlement

Receiver bank

Settlement request

Settlement request

RTGS
on a transaction-by-transaction
basis

Funds Clearing
Designated-time net settlement (DNS)
at the end of each day

Bank of Japan (BOJ-NET)

Bank D

Bank CBank D

Notes
1. Figures in the diagram indicate the debtor-creditor (debt and credit) relationships between banks accompanying credit transfers.
2. Debts and credits between banks may be replaced by a debtor-creditor relationship between each bank and the Zengin-Net (CCP).

910

ZENGIN SYSTEM

Configuration of the Zengin System

Solid Security and Reliability
The Zengin System consists of the host computersat the Zengin Centers that comprise the hub of thesystem, the Zengin relaying computers (RCs) installedin the computer centers of the member banks (in thecase of agency participation, the Zengin RCs are
installed in the joint center), and the communicationlines that connect these computers.
To assure the Zengin System’s security andreliability, duplicate computer systems back up every
aspect of the system.
The Zengin Centers are located in Tokyo andOsaka and both have adopted a multiple host computer
structure. Each member bank has at least two sets of
Zengin RCs installed. Moreover, the Zengin Centers
are equipped with a backbone network and a backup
network that are connected to each other (Figure 7).
Communication between the Zengin Centers andZengin RCs is encrypted.

Zengin Centers
The Zengin Centers in Tokyo and Osaka are both
equipped with three sets of host computers that
operate simultaneously. The separately installed hostcomputers in Tokyo and Osaka enable member banks
to continue transactions through the Osaka Centereven in the event the Tokyo Center fails due to anatural disaster or other reasons. The configurationof the system equipment of the Tokyo and Osaka
centers is the same. Two sets of host computers areused for online processing and another set is used foroffline processing and backup. We have adopted a hotstandby method to ensure that when online processing
fails due to a damaged computer, this computer canbe immediately replaced by the backup. In addition,
power supplies, data storages and other control
peripherals are duplicated.
The Zengin Centers in Tokyo and Osaka mutually
synchronize data at all times. As such, the Zengin
System provides comprehensive redundancy.

■ Figure 7: Configuration of the Zengin System (Core Time System)

The processing performance of telegraphictransfer of the Zengin System is currently 30 million
transactions per business day (6 million transactions
per hour during peak hours).

Relaying computers
The banks communicate with the Zengin Centersthrough the Zengin relaying computers (RCs) installedin their computer centers.
The transmission protocols and data formats ofthese member banks vary and therefore have to beconverted so that the Zengin Centers can accept them.
Zengin RCs convert the various transmission protocols
and data formats and then transmit the data to the
Zengin Centers. These RCs also serve as a backup
system when a member bank’s computer system fails,
by sending and receiving transfer messages directly
to/from the Zengin Centers on behalf of the bank’s
host computers.

Backbone network
Backup network

File transmission network
RC: relaying computer

With regard to the following joint systems, theRCs are installed in the joint centers of each group.
•Zenshinkin System: Shinkin Central Bank andshinkin banks• Data Transmission System for Credit Cooperatives:
The Shinkumi Federation Bank and credit cooperatives• Central Network System for Labour Banks:
The Rokinren Bank and labour banks•
Agricultural Cooperative Savings Network Service:
The Norinchukin Bank, credit federations of agricultural
cooperatives, credit federations of fishery cooperatives,and agricultural cooperatives• System Banking Kyushu:
The Fukuoka Chuo Bank, The Saga Kyoei Bank, The
Bank of Nagasaki, The Howa Bank, The Miyazaki
Taiyo Bank and The Minami-Nippon Bank

Communication lines
In addition to the backbone network, a backup
network exists between the Zengin Centers and the
Zengin RCs. If the backbone network is disconnected,
communication can be continued by using the backup
network.

Information server system
Zengin Center (Osaka)
System 1
host

System 2
host

The information servers form a separate system fromthe fund transfer system. This system is used by the
Zengin Centers to transmit statistical information andother data to member banks and by member banks
to send online requests and registration to a Zengin
Center.

Zengin Center (Tokyo)

System 3
host

System 1
host

System 2
host(backup)

System 3
host

Host (RTGS)(backup)RC

RC

Host (funds transfer)

Backup network

Backbone network, file transmission network
Bank of Japan

RC

RC

RC

Host
Bank hosting center(individual connection method)

11

RC

RC

Host
Branch offices

Bank hosting center(individual connection method)

RC
Host

Branch offices

Joint center(agency participation)

Regional centers

Financial institutions

12

ZENGIN SYSTEM

History of the Zengin System

Performing a Leading Role in the Centralized Settlement System between Financial Institutions
The Zengin System began operations on April 9, 1973, under the
management of the Organization for the Management of Domestic
Fund Transfers established by the then Tokyo Bankers Association (nowJapanese Bankers Association). Following implementation of the Payment
Services Act in April 2010, which defines the fund clearing business underlicense, the Zengin-Net was established that same month to take over theoperations of the Zengin System from the Tokyo Bankers Association. The
Zengin-Net began operations of the Zengin System in October of that year
upon issuance of the relevant license by the Prime Minister.
The computer systems used for the Zengin System are developedand supplied by NTT DATA Corporation. Since the system’s inception,
the company has maintained the system at a high level of security andreliability.
The system constitutes an infrastructure for retail funds transfer inJapan and is now commonly known as “Zengin” throughout the global
financial industry.

The 7th Generation Zengin System
The 7th Generation Zengin System, which started operations in November
2019, inherits the functions and configuration of the 6th Generation
Zengin System. By introducing the latest equipment, steps are being taken
to enhance safety and reliability by increasing capacity and processing
performance, strengthening cybersecurity measures, and reducing power
consumption.
In addition to the “Core Time System,” which supports fund transfer
transactions during daytime on weekdays, since October 2018, the “MoreTime System” has been in operation, which supports transfers at nighttime
on weekdays, weekends, and holidays, realizing Zengin System operations
on a 24/7 basis. However, the “More Time System” is available only for
telegraphic transfers (less than 100 million yen per transaction).

■ History of the Zengin Data Teleco
Generation

1st

2nd

3rd

4th

Start of Operations

April 9, 1973

February 13, 1979

November 16, 1987

November 13, 1995

mmunication System
Number ofParticipating BanksContent of Service

Processing Capacity

Telegraphic transfers• Remittances• Credit transfers• Collections• Other transfers (fund transfers, billing, etc.)

Telegraphic transfers
Per hour: 160,000 transactions
Per day: 1 million transactions
Daily average in 1973: 170,000 transactions

708

Telegraphic transfers
Addition of credit transfer for payrolls

Telegraphic transfers
Per hour: 440,000 transactions (final capacity: 800,000 transactions)
Per day: 1.4 million transactions (final capacity: 2.3 million
transactions)
Daily average in 1979: 590,000 transactions

5,304

Telegraphic transfers
Addition of MT data file transmission (from October 7, 1988)
Document-based transfers, post-dated transfers, credit transfers for
payrolls, bonuses, pensions, benefits, loan-trust dividend transfers andstock dividend transfers

Telegraphic transfers
Per hour: 1.25 million transactions (final capacity: 2.5 million
transactions)
Per day: 5 million transactions (final capacity: 10 million transactions)
Daily average in 1987: 1.6 million transactions

3,552

Telegraphic transfers
MT data file transmissions
Addition of itemized accounts of centralized government payments,
statements for bulk payment systems and confirmation of receiveraccount

88

Telegraphic transfers
Addition of credit transfer for government payments

5thNovember 17, 2003

1,679

Zengin EDI System (ZEDI)On the Zengin-Net, the Zengin EDI System (ZEDI) was built andlaunched in December 2018 (development and maintenance by
NTT DATA Corporation). The system moves transfer messages
between companies transitioned to XML messages (ISO20022)
and allows for various EDI information (payment notification
number, invoice number, etc.) to be attached when transfers are
made from the paying company to the receiving company. This is
expected to improve the efficiency of clearing accounts receivable
at the receiving company while the paying company will be able
to reduce the number of inquiries regarding payment verification.
ZEDI services are provided through a total of 333 financial
institutions comprised of 101 banks, Shinkin Central Bankand 231 Shinkin Banks (as of the end of November 2019).

Telegraphic transfers
MT data file transmissions

6th

November 14, 2011

1,371

(Core Time System)
1,229

7th

November 4, 2019
(More Time System)
1,200** As of the end of
November 201913

MT data file transmissions
Addition of information server system
Faster information delivery and paperless operations throughdigitization of transaction statements

Telegraphic transfers
Per hour: 3.4 million transactions (no upgrades implemented)
Per day: 13.5 million transactions (no upgrades implemented)
Daily average in 1995: 3.54 million transactions
MT data file transmissions
Per day: 4 million transactions
Telegraphic transfers
Per hour: 3.8 million transactions (initial facility)
Per day: 15 million transactions (initial facility)
Daily average in 2003: 4.91 million transactions
MT data file transmissions
Per day: 4 million transactions (expandable up to 12 million
transactions)
Telegraphic transfers
Per hour: 5 million transactions (initial facility)
Per day: 20 million transactions (initial facility)
Daily average in 2011: 6.06 million transactions

Information server system
Confirmation of settlement status, etc., for large-value domestictransfers, introduction of online submission for branch registration, fundof collateral amount and sender net debit cap

MT data file transmissions(to be discontinued after shift to new file transfer facility)
Per day: 4 million transactions

Telegraphic transfers
New file transfer facility
Information server system
MT data file transmissions discontinued (complete migration to new
file transfer facility)

Telegraphic transfers
Per hour: 6 million transactions
Per day: 30 million transactions

Telegraphic transfers

Telegraphic transfers
Per settlement day: 5.4 million transactions (both centers)

New file transfer facility
Per day: 26 million transactions

New file transfer facility
Per day: 31 million transactions

14