Financial Instruments (Tables)

12 Months Ended

Mar. 31, 2026

Disclosure of detailed information about financial instruments [abstract]

The main indicators used by the Group in capital management are as follows:


	(In millions of yen)
	March 31, 2025			March 31, 2026
Total shareholders’ equity		223,731			430,761
Equity capital ratio (1) (%)		5.54	%		8.32	%

(1)

Equity capital ratio is calculated as total shareholders’ equity divided by total liabilities and shareholders' equity.

Schedule of Capital Adequacy Ratio, Core Capital, Total Capital and Risk-Weighted Assets

The table below presents PayPay Bank Corporation's capital adequacy ratio, core capital, total capital and risk-weighted assets under Japanese GAAP.


	(In millions of yen)
	March 31, 2025			March 31, 2026
Capital adequacy ratio		16.76	%		14.04	%
Core capital		145,215			157,147
Total capital		132,575			144,202
Risk-weighted assets		790,957			1,026,786

Schedule of Gross Carrying Amounts of Financial Assets Measured at Amortized Cost by Due Date

The following table details the gross carrying amounts of financial assets for the businesses other than banking business subsequently measured at amortized cost (1) by due date:

As of March 31, 2025


									(In millions of yen)
			Financial assets with loss allowance measured at lifetime ECL
	Financial assets with loss allowance measured at 12-month ECL		Accounts receivables for which simplified approach is applied		Financial assets with significant increase in credit risk since initial recognition		Credit- impaired financial assets		Financial assets that are purchased or originated credit- impaired		Total
Not past due		1,479,394		1,914		—		—		—		1,481,308
Within 30 days		66,830		28		2,781		948		95		70,682
Within 31 to 90 days		—		3		4,486		3,250		1,383		9,122
Over 90 days		—		494		—		36,389		10,103		46,986
Total		1,546,224		2,439		7,267		40,587		11,581		1,608,098

As of March 31, 2026


									(In millions of yen)
			Financial assets with loss allowance measured at lifetime ECL
	Financial assets with loss allowance measured at 12-month ECL		Accounts receivables for which simplified approach is applied		Financial assets with significant increase in credit risk since initial recognition		Credit- impaired financial assets		Financial assets that are purchased or originated credit- impaired		Total
Not past due		1,522,485		2,789		—		—		—		1,525,274
Within 30 days		86,713		74		3,128		1,159		82		91,156
Within 31 to 90 days		—		28		5,944		3,519		1,673		11,164
Over 90 days		—		378		—		37,277		13,210		50,865
Total		1,609,198		3,269		9,072		41,955		14,965		1,678,459

(1)

These assets include cash and cash equivalents, guarantee deposits, accounts receivable, loans and advances to customers, securities and other financial assets on the Group’s Consolidated Statements of Financial Position. All of the loss allowance for the financial assets other than credit card receivables and settlement receivables in the tables are measured at 12-month ECL as of March 31, 2025 and 2026. In addition, all of those financial assets except for credit card receivables and settlement receivables were not past due as of March 31, 2025 and 2026.

Schedule of Financial Assets Segregated into Credit Qualities Based on Internal Risk Assessments

For the banking business, financial assets are segregated into following credit qualities based on internal risk assessments by debtors.


Classification of debtors		Basis of classification
Performing		Account not classified as either
Credit Watch		Account designated for elevated attention
At Risk or Default		Account where there is an increased likelihood that default may exist based on qualitative and quantitative factors

As of March 31, 2025


					(In millions of yen)
			Financial assets with loss allowance measured at lifetime ECL
	Financial assets with loss allowance measured at 12-month ECL		Financial assets with significant increase in credit risk since initial recognition		Credit- impaired financial assets		Total
Performing		2,143,066		—		—		2,143,066
Credit Watch		—		1,849		—		1,849
At Risk or Default		—		—		1,680		1,680
Total		2,143,066		1,849		1,680		2,146,595

As of March 31, 2026


					(In millions of yen)
			Financial assets with loss allowance measured at lifetime ECL
	Financial assets with loss allowance measured at 12-month ECL		Financial assets with significant increase in credit risk since initial recognition		Credit- impaired financial assets		Total
Performing		3,065,985		—		—		3,065,985
Credit Watch		—		2,279		—		2,279
At Risk or Default		—		—		3,023		3,023
Total		3,065,985		2,279		3,023		3,071,287

Schedule of Movements in Loss Allowances for Financial Assets

The movements in loss allowances for the financial assets are as follows:

For the year ended March 31, 2025


										(In millions of yen)
				Financial assets with loss allowance measured at lifetime ECL
	Financial assets with loss allowance measured at 12-month ECL			Accounts receivables for which simplified approach is applied			Financial assets with significant increase in credit risk since initial recognition			Credit-impaired financial assets			Total
Balance as of April 1, 2024		8,822			589			1,308			22,190			32,909
Provision for loss allowance, net of reversal		3,851			(84	)		81			—			3,848
Write-offs		(1,621	)		(1	)		(709	)		(13,622	)		(15,953	)
Transfer between stages		(205	)		—			(647	)		852			—
Changes in risk variables		(142	)		—			1,539			23,661			25,058
Other		(45	)		—			—			29			(16	)
Balance as of March 31, 2025		10,660			504			1,572			33,110			45,846

For the year ended March 31, 2026


										(In millions of yen)
				Financial assets with loss allowance measured at lifetime ECL
	Financial assets with loss allowance measured at 12-month ECL			Accounts receivables for which simplified approach is applied			Financial assets with significant increase in credit risk since initial recognition			Credit-impaired financial assets			Total
Balance as of April 1, 2025		10,660			504			1,572			33,110			45,846
Provision for loss allowance, net of reversal		4,838			(69	)		27			2			4,798
Write-offs		(1,679	)		(12	)		(696	)		(12,661	)		(15,048	)
Transfer between stages		(126	)		—			(782	)		908			—
Changes in risk variables		(448	)		—			1,864			22,006			23,422
Derecognition of receivables upon sale		—			—			—			(10,598	)		(10,598	)
Other		6			—			—			(47	)		(41	)
Balance as of March 31, 2026		13,251			423			1,985			32,720			48,379

Schedule of Balance of Financial Liabilities by Repayment Date

The following table details the balance of financial liabilities by repayment date. The contractual cash flow amount below reflects cash flow presented on an undiscounted cash flow basis, including interest expense.

As of March 31, 2025


													(In millions of yen)
	Book value		Contractual cash flow		Within 1 year		Within 1-2 years		Within 2-3 years		Within 3-4 years		Within 4-5 years		More than 5 years
Non-derivative financial liabilities
Deposits		2,385,939		2,386,132		2,371,106		3,531		4,065		695		1,761		4,974
Accounts payable		949,397		949,397		949,396		1		—		—		—		—
Borrowings		399,578		401,819		202,992		59,136		37,083		91,446		11,012		150
Other financial liabilities		33,021		33,021		33,017		4		—		—		—		—
Lease liabilities		12,097		12,661		2,933		2,373		2,288		2,247		1,805		1,015
Derivative financial liabilities
Other financial liabilities		1,186		1,186		1,186		—		—		—		—		—
Total liabilities		3,781,218		3,784,216		3,560,630		65,045		43,436		94,388		14,578		6,139

Off-balance sheet item
Undrawn loan commitments		—		9,954,633		9,954,633		—		—		—		—		—

As of March 31, 2026


													(In millions of yen)
	Book value		Contractual cash flow		Within 1 year		Within 1-2 years		Within 2-3 years		Within 3-4 years		Within 4-5 years		More than 5 years
Non-derivative financial liabilities
Deposits		2,952,495		2,952,536		2,935,149		5,118		4,540		1,204		2,222		4,303
Accounts payable		1,122,338		1,122,338		1,122,338		—		—		—		—		—
Borrowings		564,956		566,243		392,273		67,883		92,747		11,813		1,376		151
Other financial liabilities		46,748		46,748		46,430		106		106		106		—		—
Lease liabilities		9,549		9,924		2,475		2,353		2,257		1,823		770		246
Derivative financial liabilities
Other financial liabilities		1,368		1,368		1,368		—		—		—		—		—
Total liabilities		4,697,454		4,699,157		4,500,033		75,460		99,650		14,946		4,368		4,700

Off-balance sheet item
Undrawn loan commitments		—		10,622,322		10,622,322		—		—		—		—		—

Schedule of Remaining Lines of Credit Available

The Group has lines of credit with financial institutions for borrowing arrangements and liquidation arrangements of credit card receivables. The remaining lines of credit available are as follows:


	(In millions of yen)
	March 31, 2025			March 31, 2026
Committed lines of credit
Total		3,673			5,124
Used		—			—
Remaining		3,673			5,124

Uncommitted lines of credit
Total		910,200			1,024,200
Used		(109,900	)		(205,600	)
Remaining		800,300			818,600

Total remaining lines of credit available		803,973			823,724

Schedule of Impact on Profit or Loss Before Tax and Shareholders's Equity from Net Financial Assets of Interest Rate Fluctuations

The table below presents the impact of a 1% increase in market interest rates, which would reduce profit or loss before tax and shareholders’ equity. A corresponding 1% decrease in market interest rates would result in an equal and opposite impact.


	(In millions of yen)
	For the year ended
	March 31, 2025	March 31, 2026
Impact on profit or loss before tax	18,085	23,111
Impact on shareholders' equity	12,500	15,947

The fluctuation is based on the assumption that risk variables other than interest rates remain constant, and does not take into account the correlation between interest rates and other risk variables. In general, an increase in market interest rates results in a decrease in the fair value of debt instruments, while a decrease in market interest rates results in an increase in their fair value. The following table presents the sensitivity of the fair value to the fluctuation of interest by 100 basis points.


	(In millions of yen)
	As the date of
	March 31, 2025	March 31, 2026
Change of fair value	9,225	11,155

Summary of Financial Instruments Measured at Fair Value on A Recurring Basis

The following table presents financial instruments measured at fair value on a recurring basis by level within the fair value hierarchy.

As of March 31, 2025


					(In millions of yen)
	Fair value
	Level 1		Level 2		Level 3		Total
Securities
Financial assets measured at FVTPL
Debt instruments
Exchange traded funds		132,509		—		—		132,509
Equity instruments
Equity securities		184		—		—		184
Financial assets measured at FVTOCI
Debt instruments
Japanese government bonds and municipal bonds		4,639		6,786		—		11,425
Corporate and other debt securities		—		87,492		8,200		95,692
Asset backed securities		—		—		279,442		279,442
Other financial assets
Financial assets measured at FVTPL
Derivative assets		228		2,006		—		2,234
Total		137,560		96,284		287,642		521,486

Other financial liabilities
Financial liabilities measured at FVTPL
Derivative liabilities		102		1,084		—		1,186
Total		102		1,084		—		1,186

As of March 31, 2026


					(In millions of yen)
	Fair value
	Level 1		Level 2		Level 3		Total
Securities
Financial assets measured at FVTPL
Debt instruments
Exchange traded funds		202,879		—		—		202,879
Equity instruments
Equity securities		306		24		964		1,294
Financial assets measured at FVTOCI
Debt instruments
Japanese government bonds and municipal bonds		55,949		2,725		—		58,674
Corporate and other debt securities		3,118		77,736		6,732		87,586
Asset backed securities		—		—		335,214		335,214
Other financial assets
Financial assets measured at FVTPL
Derivative assets		203		2,107		—		2,310
Total		262,455		82,592		342,910		687,957

Other financial liabilities
Financial liabilities measured at FVTPL
Derivative liabilities		100		1,268		—		1,368
Total		100		1,268		—		1,368

Schedule of Fair Value and Carrying Amount of Financial Assets and Financial Liabilities

The following table compares the fair value and carrying amount of the financial assets and financial liabilities. These are not measured at fair values in the Group’s Consolidated Statements of Financial Position, but for which fair values are disclosed. Certain financial instruments with short-term maturities are not included as their carrying amounts approximate their fair value.

As of March 31, 2025


							(In millions of yen)
	Book value		Fair value
			Level 1		Level 2		Level 3		Total
Financial assets measured at amortized cost
Loan and advances
Mortgage loans		664,594		—		—		673,236		673,236
Overdraft		261,943		—		—		327,971		327,971
Other		383		—		—		383		383
Securities
Debt instruments
Japanese government bonds and municipal bonds		353,590		126,188		220,256		—		346,444
Corporate and other debt securities		200,015		—		195,886		—		195,886
Asset backed securities		2,891		—		—		2,866		2,866
Total		1,483,416		126,188		416,142		1,004,456		1,546,786
Financial liabilities measured at amortized cost
Deposits
Demand deposits		1,688,643		—		1,688,643		—		1,688,643
Time deposits		152,393		—		152,222		—		152,222
Borrowings
Loan payables		315,578		—		99,354		210,907		310,261
Total		2,156,614		—		1,940,219		210,907		2,151,126

As of March 31, 2026


							(In millions of yen)
			Fair value
	Book value		Level 1		Level 2		Level 3		Total
Financial assets measured at amortized cost
Loan and advances
Mortgage loans		909,483		—		—		908,513		908,513
Overdraft		312,255		—		—		337,479		337,479
Other		16,879		—		—		16,841		16,841
Securities
Debt instruments
Japanese government bonds and municipal bonds		720,182		264,985		439,089		—		704,074
Corporate and other debt securities		328,535		—		319,545		—		319,545
Asset backed securities		2,471		—		—		2,480		2,480
Total		2,289,805		264,985		758,634		1,265,313		2,288,932
Financial liabilities measured at amortized cost
Deposits
Demand deposits		2,090,486		—		2,090,486		—		2,090,486
Time deposits		178,594		—		178,319		—		178,319
Borrowings
Loan payables		491,956		—		208,150		278,056		486,206
Total		2,761,036		—		2,476,955		278,056		2,755,011

Schedule of Changes in Financial Instruments Categorized as Level 3

The changes in financial instruments categorized as Level 3 are as follows:

For the year ended March 31, 2025


				(in millions of yen)
	Financial assets measured at FVTOCI
	Asset backed securities			Corporate and other debt securities			Total
Fair value as of April 1, 2024		204,271			9,663			213,934
Purchases		138,261			—			138,261
Total gains (losses) for the year:
Included in other comprehensive income (loss)		(1,964	)		(63	)		(2,027	)
Sales and settlements		(61,126	)		(1,400	)		(62,526	)
Fair value as of March 31, 2025		279,442			8,200			287,642

For the year ended March 31, 2026


						(in millions of yen)
	Financial assets measured at FVTPL		Financial assets measured at FVTOCI
	Equity Securities		Asset backed securities			Corporate and other debt securities			Total
Fair value as of April 1, 2025	-			279,442			8,200			287,642
Purchases		964		135,968		-				136,932
Total gains (losses) for the year:
Included in other comprehensive income (loss)	-			(192	)		(68	)		(260	)
Sales and settlements	-			(80,004	)		(1,400	)		(81,404	)
Fair value as of March 31, 2026		964		335,214			6,732			342,910

Valuation Techniques Used to Measure Fair Value of Major Assets Classified as Level 3 Significant Unobservable Inputs

The valuation techniques used to measure the fair value of major assets classified as Level 3 and significant unobservable inputs are as follows:


Financial assets	Valuation technique	Significant unobservable inputs
Asset backed securities	Discounted cash flows	Discount margin/spreads Constant prepayment rate Constant default rate
Equity securities	Discounted cash flows	Real estate risk premium
Loan and advances Debt instruments	Discounted cash flows	Credit spread

Schedule of Carrying Amount of Assets Pledged as Collateral

The carrying amounts of assets pledged as collateral are as follows:


	(In millions of yen)
	March 31, 2025		March 31, 2026
Guarantee deposits (1)		2,133		1,980
Loans and advances to customers (2)		30,982		30,999
Securities (1)(3)		249,056		605,904
Other (1)		3,713		5,162
Total		285,884		644,045

(1)

Financial institutions have the right to dispose of the assets pledged as collateral and apply the proceeds to satisfy the outstanding debt or offset the amount due in the event of a default.

(2)

The Group does not derecognize credit card receivables that are transferred to securitization trusts. The amounts of borrowings from securitization backed by pledged loans and advances to customers was 55,000 million yen as of March 31, 2025 and 2026. The transfers of credit card receivables that do not meet the requirements for derecognition are shown in (ii) Transfers of receivables arising from the credit card business above.

(3)

PayPay Bank Corporation pledges securities as collateral with the Bank of Japan and the Japanese Banks' Payment Clearing Network for funding and for settlement purposes.

Schedule of Offsetting Financial Assets and Financial Liabilities

The offsetting information regarding financial assets and financial liabilities is as follows:

As of March 31, 2025


						(In millions of yen)
	Gross amounts of recognized financial assets and financial liabilities		Amounts offset in Consolidated Statements of Financial Position			Net amounts presented in Consolidated Statements of Financial Position		Net amounts
Financial assets
Accounts receivable
Settlement receivables		54,611		(21,904	)		32,707		32,707
Other receivables		15,396		(15,396	)		—		—
Loans and advances to customers
Credit card receivables		1		(1	)		—		—
Other financial assets
Receivables from third party operators of deposit machines		21,418		(16,075	)		5,343		5,343
Financial liabilities
Accounts payable
Settlement payables		934,212		(36,473	)		897,739		897,739
Credit card payables		27,742		(373	)		27,369		27,369
Other payables		545		(1	)		544		544
Other financial liabilities
Accrued expenses		454		(454	)		—		—
Suspense receipts		19,496		(16,075	)		3,421		3,421

As of March 31, 2026


						(In millions of yen)
	Gross amounts of recognized financial assets and financial liabilities		Amounts offset in Consolidated Statements of Financial Position			Net amounts presented in Consolidated Statements of Financial Position		Net amounts
Financial assets
Accounts receivable
Settlement receivables		55,361		(25,674	)		29,687		29,687
Other receivables		18,676		(18,676	)		—		—
Loans and advances to customers
Credit card receivables		1		(1	)		—		—
Other financial assets
Receivables from third party operators of deposit machines		22,201		(17,547	)		4,654		4,654
Financial liabilities
Accounts payable
Settlement payables		1,108,070		(43,533	)		1,064,537		1,064,537
Credit card payables		30,684		(404	)		30,280		30,280
Other payables		589		(2	)		587		587
Other financial liabilities
Accrued expenses		412		(412	)		—		—
Suspense receipts		20,681		(17,547	)		3,134		3,134