A spring downpour last week wasn’t enough to stop Norito Nagahama from heading to a central-Tokyo brokerage to study up on Japanese stocks.

“I’m here because I need to learn about investment,” said Nagahama, 39. “You get little out of bank savings.”

The biggest equity slump in the developed world isn’t putting Nagahama off either. When he gets his next bonus, Nagahama is signing up for a Nippon Individual Savings Account as one of the 8.65 million people in Japan projected to do so by year’s end. The program, which began Jan. 1 and gives temporary tax breaks on share gains, will draw as much as ¥5.5 trillion ($54 billion) into riskier assets this year, according to Nomura Research Institute Ltd.

The Topix index sank 7.6 percent last quarter, buffeted by a stronger yen, concern about the April sales tax increase and waning euphoria about Prime Minister Shinzo Abe’s policy program. With individual investors accounting for less than a quarter of trading on Japanese stocks in March, brokerages say they’re optimistic the NISA accounts will drive a change in attitudes to investment. The gauge fell 1.2 percent to a seven-month low at the trading break in Tokyo on Friday, heading for the biggest weekly slump since June.

Daiwa Securities Group Inc., SBI Securities Co. and Saison Asset Management Co. all reported a surge in NISA accounts in the program’s first quarter. The government is trying to get Japanese households to move some of their ¥874 trillion in cash and bank deposits into stocks to boost retirement savings and provide companies with capital to revive growth. That’s part of Abe’s strategy to beat deflation with a combination of fiscal stimulus, aggressive monetary easing and vows of structural reform.

For Sumiko Matsuoka, 37, looming inflation was one reason she attended a NISA seminar on April 3 at Nomura Holdings Inc., Japan’s biggest brokerage. A rise in prices enhances the allure of assets such as stocks while cutting the value of cash.

“I need to cope with inflation risk through investment,” said Matsuoka, who has put money in stocks with Nomura for about five years. “The world started saying NISA, NISA. I heard it won’t be taxed, so I thought maybe I should open an account.”

About 36 percent of NISA account holders began investing by March 19 at SBI Securities, Japan’s biggest online brokerage, which saw accounts jump 66 percent to 416,000 last quarter. Most of them were reportedly people who are already playing the stock market.

“It’s going really well,” said Hiroyuki Ogawa, Tokyo- based general manager at SBI. “While stocks are more popular, more clients are accumulating money in investment trusts. More people are going for long-term, diversified investment.”

About 6.5 million people probably applied for a NISA account through January and another 2.15 million will do so by the end of the year, according to a study published by Nomura Research Institute in February. The number of NISA accounts soared 29 percent to about 569,000 last quarter at Daiwa Securities, said Masatoshi Fukuyama, a spokesman for Japan’s No. 2 broker.

An average of ¥1.3 trillion is likely to flow into the Japanese share market via NISA each year over the next five years, said Hiromichi Tamura, Japan chief strategist at Nomura’s equity research department. That would lift the market by 5 percent a year, without taking other factors that influence stock prices into account, he said.

“Individuals’ money, which has hardly moved, is flowing into the market and that’s positive and provides a floor,” Tamura said. “Until now, people didn’t need to move their bank savings under deflation and that was the right choice. But that’s changing and they’re thinking about rocking the boat. NISA emerged as a way to entice them to invest.”

The NISA program allows individual investors to buy ¥1 million a year in stocks, exchange-traded funds, investment trusts and real estate investment trusts listed in Japan and abroad, with a five-year tax exemption on capital gains and dividends.

Bonds and currencies are not covered by the program, which runs through 2023. Such taxes on shares held outside NISA accounts doubled to 20 percent on Jan. 1.

Individual investors bought ¥1.51 trillion more Japanese shares than they sold last quarter, according to the Tokyo Stock Exchange. They recorded net sales of ¥4.36 trillion from October through December.

“I don’t think NISA has had much impact or will have enough power to lift the market,” said Akihiro Ohara, head of sales trading for Japan at Societe Generale Securities. “It’s pretty difficult for those who had little to do with stocks and have kept their money in banks to change.”

Individual investors accounted for 23.3 percent of stock transactions in March, the Tokyo exchange said, compared with 66.2 percent for overseas investors. Foreigners sold a net ¥1.83 trillion in Japanese stocks last quarter.

Japanese households held ¥1.645 quadrillion in financial assets as of the end of 2013, according to data from the Bank of Japan. Fifty-three percent of that, or ¥874 trillion, was in cash and bank deposits, while 9.4 percent was in stocks and 4.8 percent in investment trusts.

Abe is trying to boost the stock market as the BOJ continues its unprecedented monetary stimulus program to achieve a 2 percent inflation target. Abe’s supporters are urging the Government Pension Investment Fund to cut its reliance on domestic bonds and seek higher returns to cover rising pension payouts in the world’s oldest population.

While change won’t happen overnight, NISA is gradually prompting Japanese to invest their money rather than just save, said Haruhiro Nakano, president of Saison Asset, which sells investment trusts directly to clients. Saison had about 8,000 NISA accounts at the end of March, up 60 percent from the end of 2013, he said.

“The impact is small for now, but I think it’ll be huge if each individual starts using their ¥1 million to support growth,” he said. “That’s going to fundamentally change where Japanese people put their money.”

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