OSAKA (Kyodo) — The recent bankruptcy of a Japanese credit-card transaction system provider has left tens of thousands of restaurants and shops without payment for their latest sales, raising concerns among business owners over the prospect of recovering the lost revenues.
Zentoshin filed for bankruptcy with the Osaka District Court on Monday, making it likely the country’s largest bankruptcy so far this year with 115.16 billion yen ($709 million) in liabilities, according to the corporate credit research firm Teikoku Databank Ltd.
A lawyer serving as a court-appointed receiver in the case said Wednesday that no new payments have been made to the Osaka-based company’s no less than 20,000 users for sales that have occurred since July 1.
Zentoshin provided quick payments to users — mostly restaurant operators — for the sales they made from credit card transactions, earning commissions from users in the process. Credit-card companies, meanwhile, had asked Zentoshin to help them sign up business users.
“I’ve already given up on recovering our (credit) sales for July,” said Jun Nojiri, 63, whose restaurant in Urayasu, Chiba Prefecture, makes roughly 60 percent of its sales through credit cards and relied on Zentoshin for payment.
A national trade group is calling on restaurant owners to discontinue any use of Zentoshin’s transaction system immediately and accept payment through other services or in cash.
As of 2018, Zentoshin had about 200,000 users. But its business suffered as its users were hit by the coronavirus pandemic, and recently it had been experiencing financial difficulties.