In March Toyota Finance plans to issue a Japanese digital bond on the Progmat tokenization platform. While digital bond issuance is growing in Europe, so far most security tokens in Japan have been linked to real estate. Not only is Toyota one of the few corporates to issue one, but it is targeting retail investors, which is unusual.
Reaching consumers appears to be a key goal – making customers investors and getting them to download the Toyota Wallet. Japan has a tradition of offering product linked perks to investors.
Bonuses of up to 1% in cash value will be offered for Toyota bond purchases, but only via the wallet. The wallet can be used to get tips on how to extend a car’s life.
Looking at the Toyota Wallet website, it offers a rich set of other features. These include the ability to apply for car loans, using it for general smartphone payments, car navigation, EV charging and parking reservation.
The planned issuance will have a small denomination of Yen 100,000 ($658) with a total of Yen 1 billion ($6.6m), indicating its experimental nature.
Daiwa Securities is the underwriter, MUFG the bond administrator and MUFG Trust will act as bond registry administrator.
The tokenization platform Progmat was founded by MUFG. While it remains the largest shareholder, other investors include the country’s second and third largest banks, SMBC and Mizuho.
Meanwhile, the vast majority of large digital bonds are issued by financial institutions, with a few exceptions such as Siemens and Hitachi. Technically this is not Toyota’s first digital bond – Toyota Leasing issued one in Thailand back in 2020.
