On July 6, 2026, Zentoshin Co., Ltd., a major credit card 支付 agency based in Osaka, filed for bankruptcy at the Osaka District Court and received an immediate order to begin bankruptcy proceedings. With total debts of approximately 125.9 billion 日圓, it is the largest bankruptcy of 2026. The collapse is having severe repercussions on both the food service industry and 地方 financial institutions.
Zentoshin’s Business Model
Founded in 1987 as the “Osaka Minami Food Business Cooperative” and incorporated in 2006, Zentoshin provided merchant acquisition services for credit card companies and offered early 支付 services by advancing merchant settlement funds. 餐廳 particularly valued receiving 支付 as quickly as four days after card use. At its peak in 2018, Zentoshin served over 200,000 merchants, generating approximately 8.2 billion 日圓 in revenue in fiscal 2020.
Path to Collapse
The COVID-19 pandemic dealt a severe blow as 餐廳 operating restrictions directly impacted Zentoshin’s business. Even after the pandemic subsided, the company struggled under past financial obligations. In January 2024, the company’s sales headquarters manager was arrested by the 東京 Metropolitan Police for fraudulently registering merchants using false identities. The company itself was later referred to prosecutors for violating organized crime laws.
This compliance failure triggered contract reviews by international card brands and domestic credit companies, followed by a coordinated halt of funding from lenders. The resulting 現金 shortage made business continuation impossible.
Impact on 餐廳
The bankruptcy has frozen 支付 settlements for affiliated 餐廳. Credit card terminals have stopped working, forcing many establishments to operate on a 現金-only basis. Small individually-owned 餐廳 face severe 現金 flow pressures, with some facing existential threats.
Zentoshin had particularly deep penetration in nightlife establishments—high-end clubs in Ginza and Kitashinchi, Philippine pubs, and similar venues—serving as a last-resort 支付 provider for businesses that mainstream agencies would not touch. Finding alternative 支付 processing is proving difficult, suggesting prolonged disruption.
Ripple Effects on 地方 Banks
Zentoshin’s outstanding loans include approximately 8 billion 日圓 at Towa Bank, 5 billion 日圓 at 33 Financial Group, and significant exposure at Yamaguchi Bank. On July 7, the Financial Services Agency launched an investigation into the impact on 地方 financial institutions. Concerns are mounting that loan recovery will be difficult for many lenders.
Outlook
Bankruptcy trustee Koji Inden has been appointed to oversee asset management and claims investigation. The Zentoshin case exposes the fragility of 支付 agency businesses with lax risk management and raises serious questions about 地方 banks’ lending practices.