Online money transfer providers typically offer the strongest exchange rates and lowest fees on money transfers to Japan. Some offer cash pickup in as little as a few minutes, while others seamlessly transfer to bank accounts. Sending money through PayPal or your bank is also an option, but you’ll typically face higher fees and weaker exchange rates when going that route.
Digital money transfer services
Companies like XE specialize in foreign currencies, making them some of the most cost-effective transfers. Most offer transfers directly to your recipient’s Japanese bank account, often in as little as a day or two.
Services like MoneyGram and Western Union allow you to transfer cash for pickup at a local branch in Japan — often in 15 minutes. While it’s a fast way to send money, you’ll pay for the convenience in weak exchange rates and high fees.
Japanese yen are a popular currency, so your local bank may be able to exchange them. If your bank supports Japanse yen, beware of high fees and wide margins on the exchange rate compared to digital and other options when sending a wire transfer to Japan.
Let’s crunch the numbers: Sending $1,000 to Japan
Let’s say you need to send $1,000 to family in Japan. Here’s what you might face as far as fees and exchange rates as of November 11, 2020.
Digital money transfer service
$50 + additional correspondent bank fees
1 CAD = 79.2808 JPY
1 CAD = 78.8613 JPY
1 CAD = 75.7642 JPY
Slowest and most expensive
The bank option ends up being both the slowest and gets the smallest amount of money to your recipient in Japan. If you go with the digital money transfer service, your recipient ends up with JPY 7,305 more than the bank offers. If speed is crucial, or your recipient wants to pick up cash, a cash transfer can typically have your transfer to Japan in as little as an hour. Confirm there is a cash pickup location near your recipient before sending.
How to send money to Japan online
Sign up and send money with a digital money transfer specialist in four steps:
Sign up for a free account. Pick a provider and sign up for a free online account using your contact information, proof of ID and preferred payment method.
Provide transfer details. Submit your recipient’s contact information and pick a delivery method. If transferring to a bank, you’ll need their Japanese bank account information.
Confirm transfer details. Double-check your payment method, expected fees and destination.
Save your receipt. Record your receipt’s confirmation number to track the progress of your transfer to Japan. Some money transfer providers send a text or email when your transfer is complete.
What are the ways that I can send money to Japan
Bank transfers. Many major Canadian banks will allow you to send money to Japan.
Money transfer providers. Providers like XE and Wise can help you quickly and easily transfer your money online.
Providers with cash pickup. Western Union and MoneyGram allow you to send funds for cash pickup at agent locations.
PayPal. Electronic payment giant PayPal allows you to send money from Canada to Japan.
Cheques and money orders. Although not a quick option, you could send an international cheque overseas, obtained from your bank or credit union.
How to get the most out of your money transfer to Japan
Weigh costs and fees against convenience to learn how to compare money transfer providers that send to Japan to best meet your needs:
Exchange rates. The CAD-JPY relationship fluctuates often, so using a service that allows you to lock-in exchange prices may help you save money down the line if the Japanese yen rises against the Canadian dollar.
Transfer fees. Transferring money overseas nearly always requires fees, but they might be hidden in the exchange rate. When sending large amounts, it may be cheaper to pay a flat fee to secure a stronger CAD-JPY exchange rate.
Transfer limits. How much you can send varies by company, and different amounts can attract higher or lower fees. Shop around for the best deal on the amount of Japanese yen you’re sending to Japan.
Turnaround. Transferring money through a local bank can take a business week or longer. If you need the funds delivered quickly, seek out a digital specialist that offers instant transfers to Japan.
Sending limits. Comparing prices for one large transfer instead of many small transfers is typically easier, so picking the service you use based on how much you’re sending is a valid strategy for saving money.
Transfer methods. Whether you want money sent to a Japanese bank account or picked up as cash at a local agent, narrow down a company that matches your preferred delivery method.
Emergency cash transfer to Japan
When urgency trumps cost to get your money to Japan quickly, look for money transfer companies that support cash pickup in minutes. You can pay with a credit or debit card for fast pickup, but fees are higher than other methods.
Cash transfer services can help you if you don’t have a bank account, look for a local company that supports storefronts for cash payments. These services include agent locations in other countries that allow your recipient to pick up cash without a bank account.
Japan’s exchange rates explained
The exchange rate determines how much one country’s currency is worth in another country’s currency. When a country’s currency is strong, it yields more money when exchanging it in a country with a weaker currency. Japan’s exchange rate is flexible compared to the Canadian dollar, but the CAD-JPY relationship typically doesn’t make sharp, drastic movements. Factors that influence the exchange rate include interest rates, economic stability and inflation.
Documents needed for sending to and receiving money in Japan
To send money to Japan from Canada, you’ll need government-issued ID and other documents, while documents needed to pick up money in Japan may differ by company.
Documents to send money from Canada
To send money from Canada to Japan, you’ll need documentation and details that include:
Identification. Most services require a driver’s license, passport or other government-issued ID. Some services allow you to send transfers without ID, but they may require your SIN.
Payment method. Your service may accept credit or debit cards, cash, bank accounts or personal cheques.
Recipient information. Submit your recipient’s name as it appears on their ID, along with their phone number and Japanese bank account information.
Documents to receive money in Japan
To pick up money in person, documentation can include:
Transfer number. The person sending you money can forward the transfer’s confirmation details — called a PIN, an MTCN, a reference number or a tracking number, depending on the company.
Government-issued ID. A Japanese Passport, Japanese ID or similar official ID may be required to pick up your transfer.
Amount sent. You may need to know how much was sent, usually within 10% of the total.
Sender’s information. Take along your sender’s full name, the sending country and their address, if known.
What to watch out for
Recipients should always exercise caution when receiving funds. Canadian authorities monitor large money transfers moving in and out of the country to prevent money laundering and terrorist financing. If you’re sending a large amount of money, you may be asked to provide additional personal information for security purposes.
Regarding income tax, Canadians are not charged taxes simply for sending money. However, money transfer recipients living in Japan may be subject to a gift tax or inheritance tax, depending on the amount sent and the circumstances of the receiver.
Sending your hard-earned money to Japan shouldn’t cost a fortune. Compare money transfer companies that specialize in foreign transactions for the strongest rates, lowest fees and flexible delivery. For transfers to other countries, rely on our country specific guides the next time you need to make a transfer.
Zak Killermann is a writer at Finder. He’s ghostwritten hundreds of articles on fintech, finding his love for publication at St. Cloud State University. Traveling internationally for nearly half his life — and getting burned once by an OTC money exchange — Zak's vowed not to settle for anything short of the mid-market rate again.
Read Finder’s BoC Interest Rate Forecast Report for forecasts from some of Canada’s brightest minds in economics and property as well as their thoughts on how recent rate hikes could affect Canada’s property market.
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