Overseas remittances from Japan top ¥1 trillion for the first time

Japan’s overseas remittances topped ¥1 trillion for the first time in fiscal 2025, which ended in March, as the country sees a rise in foreign workers.

The latest Finance Ministry data showed that remittances increased by 11.5% from the previous year to ¥1.004 trillion, which is more than double the ¥464.8 billion recorded in fiscal 2015.

One factor that may have contributed to the rise is the weakness of the yen. A weaker yen means an individual sending a set amount of money back home would need to wire a larger figure in yen to account for the difference in exchange rates.

However, an increase in international wire transfers, which means selling the yen for a foreign currency, also weakens the yen.

Vietnam was the top destination for remittances, at ¥288.8 billion, followed by Indonesia at ¥89.8 billion and the Philippines at ¥67.2 billion, ministry data showed.

Hui En Lam, a 28-year-old who works at nonprofit Japan-Vietnam Cultural Association, said she sends about 20% of her income every month to her parents and younger sister in Vietnam to help pay for her sister’s tuition.

“Because of the weaker yen, I need to send more money,” she said.

According to a 2024 survey conducted by the Japan Payment Service Association on foreign workers in Japan, around 95% of those from Asia send funds to their families to support them, while 13.5% make wire transfers to buy products or send money into their own domestic accounts.

The survey had 1,270 respondents in total from Indonesia, the Philippines, Vietnam, Myanmar, Cambodia and Nepal. Most of them are in their 20s living in Japan as technical trainees or with specified skill visas.

As of October, there were 2.57 million foreign workers in Japan, up 11.7 % from the year before, according to the health ministry. Vietnam was at the top of the list with 606,000 workers, followed by China (about 432,000) and the Philippines (about 261,000). The government predicts the country’s foreign population will increase to around 5.86 million by 2040.

But the weak yen is making Japan a less competitive labor market.

A Mynavi Global survey released earlier this month showed that fewer foreign nationals want to work in Japan for five years or more.

The plunge was especially prominent for those from Vietnam. The survey showed that some 63.3% wanted to continue working in Japan for five years or longer, down from last year’s 81.7%, due in part to the weakening yen and rising wages at home.