Welcome Relief for Foreign Residents
Wiring money abroad in Japan through "normal" channels has been an expensive and time-consuming chore. The choices were either postal money orders or bank branch offices, but only at select postal or bank branch offices. The paper work was a hassle and the exchange rates were a rip-off.
But don't rush down to your local post office or bank branch just yet. Changes in Japan's fund settlement law was enacted in June, but won't be in effect for some time.
The legal change will end the banks' and post office oligopoly on fund transfers in different currencies overseas. It can cost nearly JPY5,000 to wire JPY10,000, and costs more than the amount being sent if the amount is smaller. The new law will allow "anyone who registers" to provide wire transfer services. As always detailed regulations will be decided by government ordinances, i.e., the bureaucrats, but the new fund transfer services will be able to handle amounts up to JPY1 million.
Who Benefits?
Foreign and domestic firms are positioning themselves to capture demand from foreign and Japanese residents. Western Union Co., is considering expanding into Japan, while convenience stores, should benefit the most, as will credit card companies.
Since last year, foreign banks in Japan have been allowed since last year to offer the same services they do abroad at their Japanese branches. This includes wire transfers.