Activating ¥29 Billion: How Japan’s Dormant Account Law is Reshaping Social Enterprise
Japan's long-dormant bank accounts—those untouched for over a decade—are now being activated as a powerful new source of capital. Since 2019, the government-backed dormant deposit scheme has redirected funds to nonprofits and social enterprises, totaling over **¥29 billion (approx. $193 million USD)**. This systemic shift is pivoting Japan’s social sector from traditional grant-making to scalable impact investing.
From Savings to Social Impact: The Dormant Account Mechanism
The Dormant Deposit Utilization Law is designed to break the structural constraints that have historically kept Japan’s philanthropy sector small. Instead of purely relying on private charity, this public capital is being deployed strategically. Initially used for traditional grants, the focus has recently shifted toward using the funds as **investment capital** to support early-stage social enterprises.
This marks a critical conceptual transformation. The funds are no longer static aid but are intended to **catalyze scalable ventures** that deliver measurable social value alongside financial performance, aligning with global impact investing principles. This new model is accelerating the solution of long-standing social issues from child welfare to regional revitalization.
Target Areas for Impact Investment in Japan
- **Catalytic Capital:** Direct investment into early-stage social enterprises that cannot access conventional private funding.
- **Regional Revitalization:** Funding projects that address issues like aging populations and economic decline in rural areas.
- **Youth & Welfare:** Supporting NPOs focused on child poverty, mental health, and educational opportunities for marginalized youth.
- **Ecosystem Building:** Grants to develop market infrastructure and promote best practices for impact finance across the country.
Hope Collective's Role in Japan’s New Philanthropic Era
Hope Collective is committed to supporting this innovative movement by fostering the growth and sustainability of impact-driven organizations across Japan. We focus on building capacity and connecting capital with credible social ventures:
Capacity Building Workshops
Training for NPOs on financial literacy, developing robust business models, and measuring impact.
Direct Social Investment
Providing seed funding and patient capital to mission-aligned Japanese startups focused on scaling solutions.
Cross-Sector Partnerships
Connecting local social enterprises with large corporations for mentorship, resources, and sustainability.
Invest in Japan’s Future: Support Scalable Social Change.
Help us deploy capital effectively to enterprises tackling poverty, mental health, and environmental challenges across the archipelago.