What happened to restaurants when Zentoshin went bankrupt? The Business Safety Mutual Aid that guards against chain-reaction bankruptcy
On July 6, 2026, Zentoshin Co., Ltd. (Osaka City), a payment-processing agent for credit card sales, filed for self-bankruptcy and received a decision to commence bankruptcy proceedings. With liabilities of about ¥125.9 billion, it is the largest bankruptcy of 2026, and a serious impact is spreading to restaurants and others that received their card sales through the company: "the sales are not being paid to us." This article organizes what happened, the immediate steps for affected businesses, and the mechanism and cautions of the Business Safety Mutual Aid (Small Enterprise Mutual Relief System for the Prevention of Bankruptcies), the system that prepares for exactly this kind of "sudden bankruptcy of a business partner," all based on primary sources.
・For businesses that were Zentoshin member stores, the immediate three-piece set is tallying the unpaid amount, filing a claim with the bankruptcy trustee, and switching payment methods
・If you are enrolled in the Business Safety Mutual Aid, when a business partner goes bankrupt you can borrow 10 times your paid-in premiums, up to ¥80 million, with no collateral and no guarantor (provided you have been enrolled for 6 months or more)
・The mutual aid cannot help if you enroll after a bankruptcy has already happened. You can only prepare in peacetime
Zentoshin's bankruptcy: what happened
Founded in 1987, Zentoshin was a company known for a payment-processing service that paid card sales proceeds to member stores, mainly restaurants, on an early schedule of twice a week, six times a month. On July 6, 2026, it filed for self-bankruptcy with the Osaka District Court and received a decision to commence bankruptcy proceedings the same day. Total liabilities are about ¥125,929 million[Teikoku Databank (in Japanese)][Nikkei (in Japanese)].
According to reports, business performance deteriorated as its main customers, restaurants, faced operating restrictions during the COVID-19 pandemic; carried-over financial debt from prior years was also heavy, and it was unable to rebuild its finances. In addition, in 2024 there was an incident in which employees were arrested for misconduct related to member-store contracts and the company was referred to prosecutors on documents, and problems on the credit side had also been pointed out.
The money customers paid by card flowed from the card company through Zentoshin to the member store. Because Zentoshin went bankrupt, the card sales proceeds that had not yet been paid became "bankruptcy claims," and full recovery is extremely difficult. Sales are recorded but no cash comes in, so businesses get stuck paying rent and supplier costs — this is the classic gateway to chain-reaction bankruptcy.
What affected businesses should do now
The industry group Shokudanren (Japan Foodservice Organizations Council) has also issued a warning[Shokudanren (in Japanese)]. The immediate responses are the following three.
- Stop and switch the payment terminal — halt the Zentoshin-routed terminal and switch quickly to cash handling or another company's payment service to secure a receptacle for your sales
- Tally and record the unpaid amount — total the card settlement amounts since the last payment date, preserve supporting documents (sales data and statements), and fix the amount of your loss
- File a claim with the bankruptcy trustee — within the period set by the court, file the unpaid portion as a bankruptcy claim (this is the prerequisite for receiving any distribution)
If your cash flow is also tight, you may be able to use support menus aimed at the bankruptcy of a business partner, such as loans from the Japan Finance Corporation and the guarantee system of the Credit Guarantee Association. Because national and local government support measures may be added depending on the situation, please check announcements from the Chamber of Commerce and Industry, your transacting financial institution, and the Small and Medium Enterprise Agency.
What is the "Business Safety Mutual Aid"? A national system that prepares for a business partner's bankruptcy
The system that prepares for a situation like this is the Business Safety Mutual Aid (Small Enterprise Mutual Relief System for the Prevention of Bankruptcies), operated by the Organization for Small & Medium Enterprises and Regional Innovation, JAPAN (a national incorporated administrative agency)[SMRJ (in Japanese)].
| Premium | ¥5,000 to ¥200,000 per month (freely set and increased/decreased in increments of ¥5,000). The cap on the accumulated total is ¥8 million |
|---|---|
| Tax treatment | The premium can be fully recorded as a loss (for corporations) or a necessary expense (for sole proprietors) |
| In case of trouble | If a business partner goes bankrupt, you can borrow up to 10 times the total premiums paid (maximum ¥80 million), up to the amount of accounts receivable and similar claims that have become difficult to recover, with no collateral, no guarantor, and no interest |
| If you cancel | If you have paid premiums for 40 months or more, the cancellation refund is 100% of the premiums (below 40 months it is reduced; below 12 months it is forfeited) |
The overall picture of the system and how to use it for tax saving are covered in detail in the explainer on the Business Safety Mutual Aid. This article digs into the conditions that take effect "when a business partner actually goes bankrupt."
Loan conditions and 5 points you'll regret not knowing
① Enrollment of 6 months or more and payment of 6 months' worth of premiums or more are conditions — enrolling at the last minute after a bankruptcy happens cannot be used for that bankruptcy
② The scope of "bankruptcy" is defined — legal reorganizations such as bankruptcy and civil rehabilitation, and suspension-of-transactions dispositions by a bill clearing house, are covered. A so-called "moonlight flit" is not covered
③ The eligible claims are "accounts receivable claims and advance-payment refund claims" — loan receivables, real estate lease claims, and claims against general consumers are not covered[SMRJ loan conditions (in Japanese)]
④ It is interest-free, but not free — the right to premiums equivalent to one-tenth of the borrowed amount is extinguished (an effective cost)
⑤ The repayment period is 5 to 7 years depending on the borrowed amount (including a 6-month grace period)
Even without a business partner's bankruptcy, there is also a temporary loan system that lets you borrow business funds within the range of the cancellation refund (generally within 95%). It's reassuring to keep in mind as an option for sudden cash-flow needs.
Can the mutual aid be used in the Zentoshin case?
Because Zentoshin has received a decision to commence bankruptcy proceedings, it is considered to fall under a "business partner's bankruptcy (legal reorganization)" under the mutual aid system. However, what to watch out for is the nature of the claim. The target of a mutual aid loan is "accounts receivable claims and advance-payment refund claims," and an unpaid amount owed by a payment-processing agent is structurally different from "accounts receivable owed by a party to whom you sold goods or services," so whether it qualifies is an individual judgment.
Enrollees who have an unpaid amount from Zentoshin should not give up or count on a loan on their own judgment; please check early with your enrollment counter (Chamber of Commerce and Industry or financial institution) or with SMRJ. Even if it turns out to be outside the scope of a mutual aid loan, there are other options such as the temporary loan mentioned above and Japan Finance Corporation loans.
The 2024 revision that even those who enroll for tax saving should know
The Business Safety Mutual Aid is a system that many enroll in for tax-saving purposes because "premiums are fully recorded as a loss, and everything comes back at 40 months." However, if you cancel on or after October 2024, even if you re-enroll, you cannot record premiums as a loss or a necessary expense for two years from cancellation. Because the usage of repeatedly canceling and re-enrolling has been blocked, plan the exit (the timing of cancellation) deliberately by looking at your profit situation. For details, see the explainer on the Business Safety Mutual Aid.
Summary
FAQ
What is the problem in Zentoshin's bankruptcy?
Zentoshin was a payment-processing agent that paid card sales proceeds early for restaurants and others, and it received a decision to commence bankruptcy proceedings on July 6, 2026. The biggest problem is that the card sales proceeds not yet paid to member stores became bankruptcy claims, making full recovery difficult. Liabilities amount to about ¥125.9 billion.
What should I do about unpaid card sales?
Tally and record the card settlement amounts since the last payment date, and within the period set by the court, file them with the bankruptcy trustee as bankruptcy claims. At the same time, secure a receptacle for your sales by switching payment terminals, and if your cash flow is tight, consult the Japan Finance Corporation, the Credit Guarantee Association, and your transacting financial institution early.
If I enroll in the Business Safety Mutual Aid now, can I borrow for the Zentoshin loss too?
No. Borrowing mutual aid funds requires "enrollment of 6 months or more and payment of 6 months' worth of premiums or more," and it cannot be used for a bankruptcy that has already happened. It is a system to consider enrolling in as preparation for a future business partner's bankruptcy, taking this event as a lesson.
How much can I borrow with the Business Safety Mutual Aid?
You can borrow up to ¥80 million with no collateral, no guarantor, and no interest, within the range of whichever is smaller: the amount of accounts receivable and similar claims that have become difficult to recover, or 10 times the total premiums paid. However, the right to premiums equivalent to one-tenth of the borrowed amount is extinguished, and the repayment period is 5 to 7 years.
Do premiums become an expense?
Yes. Premiums of ¥5,000 to ¥200,000 per month can be fully recorded as a loss for corporations and a necessary expense for sole proprietors. However, a revision has been made so that if you cancel on or after October 2024, you cannot record premiums as a loss or a necessary expense for two years from cancellation even if you re-enroll.
Reference links (sources)
This article was prepared based on the following materials (as of July 8, 2026). Because bankruptcy proceedings and support measures may be updated going forward, please confirm the latest information with each official source.
- Teikoku Databank — Bankruptcy Flash Report, Zentoshin Co., Ltd. (in Japanese)
- Nikkei — "Credit card payment processor Zentoshin goes bankrupt, liabilities ¥125.9 billion" (in Japanese)
- Shokudanren (Japan Foodservice Organizations Council) warning (first report) (in Japanese)
- SMRJ — Business Safety Mutual Aid, system overview (in Japanese)
- SMRJ — Business Safety Mutual Aid, mutual aid loan conditions (in Japanese)
- Small and Medium Enterprise Agency — About the Mutual Relief System for the Prevention of Bankruptcies of Small and Medium Enterprises (in Japanese)
* This article is general information, not legal or tax advice. For individual judgments such as filing claims or whether a mutual aid loan is available, please confirm with a lawyer, tax accountant, SMRJ, or your enrollment counter.