Zentoshin Co., an Osaka-based credit card payment processor, filed for voluntary bankruptcy on July 6 and received same-day approval from the Osaka District Court, reporting liabilities of about ¥125.9 billion. The failure ranks as Japan’s largest corporate bankruptcy of 2026 and has put roughly 200,000 merchants, mainly small restaurants and retailers, at risk of cash-flow disruption because the company advanced funds against future card settlements through its early-payment service. The collapse followed prolonged pressure after the COVID-19 pandemic and deepening creditor distrust after employees were arrested in January 2024 over fraudulent merchant contracts, undermining the company’s ability to refinance. Several regional banks have disclosed exposure, including Towa Bank at roughly ¥8 billion, Taiko Bank at about ¥1.5 billion, Bank of Kochi at approximately ¥1.2 billion and Shimane Bank at around ¥800 million, with some institutions already announcing writedowns or loan-loss provisions.