Let us begin our results briefing for the second quarter for the fiscal year ending in June 2023. Our Senior Vice President of Corporate and CFO, Sayaka Eda, will take us through the results.
Thank you. Good afternoon, everyone. Thank you for taking part in the FY2023 second quarter results briefing. I am the CFO of Mercari, Eda. I will take you through the results of this quarter. Here is the agenda for today. First, let us introduce the financial summary. Here are the progress and highlights of this quarter. With respect to our consolidated results, we have started investing in our credit card business since November last year to maximize our group synergy. We have continued to focus on our...
In relation to that, we have been investing in the new customer acquisitions, but we have also continued to focus on our existing marketplace, fintech business, and U.S. business, thereby booking the group's highest ever sales, as well as third consecutive profitable quarter. On the third quarter onward, we will be making greater investments than the second quarter as a group, but we will continue to operate our existing businesses while balancing growth with profit. The growth of the marketplace GMV in Q2 was 10% year-on-year, and we are, for the most part, on track. As a result of disciplined investment and establishment of a lean business foundation, the Adjusted operating margin increased to 42%. On the other hand, especially in the first quarter, we had a major update to the Mercari app, and we injected a lot of engineering resources for this update.
There was a delay in the product updates and POCs that we have implemented in the first half of the year. These POCs will start contributing to the second half of the year. In order to actually make sure that these POCs will work, we want to continue with the examination with our experiments. Our target of 10%–15% GMV for the full year, that we will be facing higher hurdles. We will continue to strive towards hitting our target. With regards to fintech, we launched our credit card business on November 8th to achieve further growth in the promising credit business.
We will continue. We have rolled out this service gradually, and we have invested in acquiring new credit card users as well, the existing credit business is providing a profit base, we booked unadjusted operating profits in Q2 as well for the fintech business. Although we expect to invest more in Q3 than Q2, we will continue to make disciplined investments. Moreover, over the mid- to long-term, we expect top line growth for this business and intend to further strengthen our profit base. In the U.S., due partially to our continuous marketing and branding efforts to drive awareness, the MAU increased 1% year-on-year. Against our full-year target of 0%-10% GMV growth, we are underachieving due to the long-term impact from inflation. Thus, the business environment will continue to be harsh in the second half as well.
We would like to revise the initial targets. We will be revising our full-year target while keeping an eye on the business environment, and we will be announcing these targets after the third quarter. We will continue to focus on product initiatives that deliver mid- to long-term growth, review costs, and balance growth and profitability to minimize losses in the second half. Here are the KPIs for each segment. The GMV of our marketplace grew by 10% year-on-year to JPY 254.8 billion. The Adjusted OP was up 16 points year-on-year to 42%, thus our profitability has improved drastically. With regards to fintech, Mercari users grew to 14.58 million. We have disclosed the credit balance and loan collection rate for the credit service Merpay is providing.
Merpay provides lump-sum payments and fixed-amount payments as well as Smart Money, so these all three services are included in the credit balance. Due to steady growth, the credit balance was JPY 92.3 billion, and the loan collection rate was 98%. The MAU for the U.S. business grew by 1% year-on-year to 5.16 million, and the GMV decreased by 12% year-on-year to $270 million. This is the consolidated net sales and operating income by segment, so please take a look. Next, moving on to the financial highlights. The consolidated net sales in Q2 has increased to a record level due to steady growth focused on marketplace. It grew by 18% year-on-year to JPY 44.2 billion. We booked operating profits for three consecutive quarters by prioritizing and disciplining our investments.
For this quarter, it was JPY 2.7 billion. We have made steady progress in Q2 with regards to fraud countermeasures, and as explained previously, we expect the impact to return to normal levels in the second half of the fiscal year. Next, the number of employees decreased by 64 QoQ to 3,184. Taking into consideration external conditions, we have implemented a more selective hiring policy as a group. Thus, the number of employees has decreased. However, we will continue to selectively hire mainly engineers to establish a main business foundation. For the marketplace, this is the progress for Q2. For the marketplace, we have set increasing the number of listings through strengthened collaboration between C2C and B2C businesses as our business policy this fiscal year.
By focusing on new user acquisition and strengthening listings, the MAU has increased, and as a result, the GMV grew by 10%. Furthermore, by making disciplined investments and building a lean business foundation, our adjusted OP increased to 42%. In Q1, we nearly completed major updates to the Mercari app. We have been able to make quick improvements to our service. Thus, we have begun POCs of various initiatives that will contribute to growth over the mid- to long-term. By strengthening listings and improving personalization capabilities, we are focusing on initiatives and investments that will consistently produce results over the mid- to long-term. We will also continue to focus on improving features of our B2C business.
Murasaki Sports and other outlet items are doing well, we have begun expanding our merchant base to include large-scale businesses that have a high affinity with Mercari Shops. This is the GMV and MAU for the marketplace. We have began acquiring new users through referral campaigns, and we have also strengthened listings through offline initiatives such as Mercari Workshops. As a result, we marked record high MAU, which grew by 780,000 to 21.53 million. GMV has grown by 10% year-on-year, as per our expectations, as I mentioned earlier. With respect to net sales, the second quarter tends to be our high season for our C2C business, and net sales has grown in line with the increase in GMV. We grew by 90% year-on-year to JPY 26.3 billion.
I will explain the adjusted OP on the next page more in detail, but as you can see, it is growing steadily. The cost structure for each quarter is shown here. The cost structure for Q2 has changed since from the latter half of last year. We have began making investments selectively, focusing on areas that provide sustainable impact. By focusing on these areas, year-on-year, the promotion cost ratio has decreased significantly. Furthermore, because fraud-related expenses has decreased as we expected, commission fees have decreased or improved, and the adjusted OP increased to 42%. Regarding Fintech, we have focused on promoting circular finance by strengthening group synergy, and these efforts are progressing smoothly. In order to further accelerate the well-performing credit business, we announced our entry into the credit card business and began gradually rolling out our Mercard from November 8th.
We have phased our service provision, but it is now available 100%, and the number of members, which is an important KPI, has grown strongly from the onset. We are off to a great start. In time with the launch of our service, we have began investing to acquire new users and encourage usage. The credit business that we have been promoting since two years ago is providing a solid profit base. Thus, we have booked unadjusted operating profit in Q2 as well. We believe that by growing this business, we will be able to create and maximize group synergy over the mid- to long-term, and that we can further strengthen our profit base.
To do so, it is important that more people utilize the Mercard, so we will keep an eye on user trends and reexamine our service and investment plans with flexibility and continue to acquire new users by making appropriate investments. Furthermore, as I mentioned before, Merpay's credit service has been growing steadily, and thus, the credit balance has surpassed JPY 90 billion in total. By utilizing unique criteria for setting the credit limit, such as behavior on Mercari and Merpay, our loan collection rate is 98%. Hence, the business is experiencing healthy growth. In the field of crypto, we are promoting the development of services utilizing blockchain technology, and we plan to release a new service that will enable users to purchase Bitcoin using their sales proceeds this coming spring.
The payment and credit businesses are growing steadily, net sales and also sales outside of Mercari have both increased. As mentioned earlier, investments have increased in relation to the launch of Mercard. The adjusted OP decreased QoQ, but we booked profits in Q2 as well. We do plan to further increase investment in Q3 when in comparison to Q2. Here is a list of services Merpay provides. Regarding payment, we had enabled iD and code payments and provided virtual cards, we have also launched a new credit card. Moreover, with respect to credit, we offer Smart Payments such as fixed amount payment and lump sum payment and Smart Money, which is a small- sum consumer loan service that allows people to borrow small amounts.
From FY2021, two years ago, Merpay has been focusing on the credit business and on strengthening our profitability and building a profit base that focuses on the credit business. Responding to the needs of Merpay users to make payments in installments, our credit balance, mainly for fixed amount payments, is growing steadily, and our loan collection rate as of FY2023 Q2 is high at 98%. We have gradually rolled out the Mercard from November, and going forward, we will maintain and improve our loan collection rate while further growing our credit business. With the help of TV commercials and customer acquisition campaigns, the number of users are growing at a good pace. Since we have just rolled out the service and are implementing various campaigns, we would like to refrain from sharing detailed KPIs.
When we compare the behavior before and after users sign up for the Mercard, the ARPU tends to be higher after they sign up. By providing Mercard, we aim to strengthen the profitability of Merpay in the future, contribute to the growth of Mercari's GMV, and reduce processing fees for payments. In order to do so, it is essential to acquire even more users and encourage usage. We will make disciplined investments and aim to make larger contributions to the business next fiscal year and beyond so that we can realize a circular economy. We have made steady efforts to verify users to ensure a safe and secure environment, and 87.5% of our users are now verified, 0.4-point increase QoQ. This is important to realize the safe and secure environment we envision and to provide an excellent user experience.
We believe that this can provide a smooth user experience when the users are verified for our credit service. We believe this is also contributing to the steady growth of our credit business as well. In the U.S., the MAU and the number of listings have grown. Our recognition as the easiest and safest selling app has also improved. The GMV fell below our expectations. The external and business environments remain uncertain, impacted by inflation and other factors, thus we will be revising our financial year target of 0%-10% GMV growth. We are currently setting the new targets whilst keeping an eye on the business environment which we will announce in the second half of the fiscal year. In order to reactivate purchase behavior, we have updated our product and implemented measures to promote purchases.
You will see how effective these measures that we implemented in the second quarter are, and further strengthen our efforts going forward. We will continue to focus on product initiatives and review expenses to minimize losses. Here are the GMV and MAU for the U.S. With respect to the MAU, we have gained a certain level of awareness, and by acquiring new users through targeted campaigns, the number of users has grown to 5.16 million, increasing 1% year-on-year. On the other hand, we are facing higher hurdles this quarter since our GMV grew by 17% same quarter last fiscal year. Combining that with the rise in prices due to inflation, prioritization of consumer spending on necessities and discounts offered by retailers with surplus inventory, we continue to see declining trends in purchasing, thus the GMV decreased by 12%.
To address our key challenge of reactivating purchase behavior, we are promoting purchases and mitigating the burden on buyers. Some of these measures have already been implemented. During the latter half of the year, we will update these measures and fully roll out point reward systems to encourage repeat purchases and improve convenience with bulk delivery options to promote purchases so that we may optimally balance listings and purchases. As the GMV growth rate declined, this is the net sales and Adjusted Operating Income. As the GMV growth rate declined, the net sales also decreased 12% year-on-year. We have continued to make disciplined investment, prioritizing mid- to long-term growth. The environment will remain difficult in the second half of the fiscal year, so we will further review our costs to minimize losses.
Lastly, with respect to our ESG activities, we would like to give you a progress update. We aspire to be Planet Positive to help solve environmental issues through our business, help people share Earth's limited resources across generations, and enable people to create new value. Through our businesses, we want to be involved in creating values that contribute to solving social and environmental issues, and also to establish a management foundation necessary for sustainable growth. To this end, we have identified five material topics. As you can see here. We will aim to achieve sustainable business growth by maximizing opportunities and mitigating risks for each topic. As part of the action plan to become Planet Positive, we are focusing on local empowerment.
We are accelerating our efforts, working with local governments across the country, mainly on easy usage, promoting reuse, education, and donations. As an example of our undertaking in Q2, on October 24, Mercari and Souzoh announced a partnership with Nishinomiya City, Hyogo Prefecture, to conduct a pilot test where City of Nishinomiya will sell reusable items collected as trash—big or small—or items brought in by its citizens on Mercari Shops. There is hope that this will reduce the cost required to dispose of such trash, and enable the city to use the proceeds from Mercari Shops for its activities. In January this year, we received the FY2022 award for being a great example of regional revitalization SDGs public-private collaboration. Our activities have been praised by the national government. We will continue to become Planet Positive by executing a wide range of action plans.
This concludes our results briefing session for FY2023 Q2. Thank you very much.