Transferring funds to IBKR cheaply? SMBC was VERY expensive

[kanpanela]

After having to pay too much for a single overseas fund transfer using SMBC, I would like to ask what is the cheapest Bank and/or cheapest method to transfer funds
to Interactive Brokers (IBKR)?

Below is an explanation of why with SMBC it cost 6,000 yen, and why in no way can it be
below 3,500 yen for me, according to what they told me in person and what their table
says.

My last fund transfer in June 2024 incurred the following fees:
- 6,000 yen fee on SMBC's side
- 15 USD on IBKR side

Settings for the transfer were
- 受取人負担
- Purpose of transfer: STOCK INVESTING MONEY or FOREIGN DEPOSIT

For some reason, I managed to do a transfer with only 800 yen fee in the past so I looked
around and found this chart online, 1st page of:
https://www.smbc.co.jp/kojin/fee/resour ... aikoku.pdf (its' explanation, below)

I was not sure I am making correct sense of it so I went to an SMBC branch office and sat
down for an explanation of how it came up 6,000 yen.

I would like to explain how it got to 6,000 yen so that maybe it will help other users
make sense of how their fee structure is decided. If you do not pay so much for SMBC
transfers, please let me know your method (assuming you did it recently, say less than a
year ago)

The table has 3 components:

1. 海外送金手数料
2. 関係銀行手数料
3. その他手数料


(1) is a fixed sum that you have to pay. And depends on whether or not you do it online
or in the office. It talks about EB/Global e-Trade which is not relevant for individuals,
only for organization, but I was explained that the 3,500 yen option of 海外他行あて+当日
受付 is the only and only option for individuals who use SMBC direct online. Since the
only other option is to do it in-person offline 7,500 yen, the 3,500 is the cheaper and
the bare minimum you have to pay for a transfer.

(2) is only relevant if you choose 依頼人負担 for your transfer. But since that costs at
least 2,500 yen, and IBKR only charges 15 USD if you choose 受取人負担, there is no reason
why not to go for the latter. So for (2) SMBC charges you nothing and IBKR charges 15
USD.

(3) is only relevant if you send and receive to accounts with the same currency on both
sides. In my case USD to USD, or JPY to JPY. It mentions 0.05% of transfer or a minimum
of 2,500JPY or 25USD, probably depends on from what account you decide to pay the fee,
USD-nominated account or JPY-nominated account. The 0.05% is irrelevant, at least for me,
as the service did not allow me to send more than 3 million yen at once, but even at 0.05%
of 3 million yen you are not even close to the minimum of 2500JPY/25USD. I was charged
2500 JPY for this item but it looks this charge can be avoided if you transfer JPY->USD or
USD->JPY, but then you have to pay currency exchange fees which I am not sure how much
they will turn out to be.

So there you have it my fee was made up of (numbering matches the above):
1. 3500 JPY
2. 15 USD from IBKR
3. 2500 JPY

Even if I were theoretically able to do currency exchange at 0 fees, I would still pay at
least 3500 JPY + 15 USD for a single transfer which seems very expensive to me.

What options do you guys use to transfer? Or do you just send once in a very long while
to combat the high fees? Or perhaps you're not attempting to send from Japan to IBKR due
to the high fees? Please let me know.

[YouMeWeThem]

One solution, if you switch over to IBKR Japan then you can make a domestic transfer from your bank which is generally free.

[smalldog]

Wise.

[kanpanela]

One solution, if you switch over to IBKR Japan then you can make a domestic transfer from your bank which is generally free.

Thank you for the suggestion!

I read around that people got moved automatically to IBKR Japan.
1. Since the transfer was not free for me does it mean I was not transferred?
2. Is it something I need to initiate deliberately?
3. Were you able to send USD to IBKR Japan for free from a Japanese bank account?

[kanpanela]

Wise.

Thank you for the suggestion!

I heard that word a couple of times before but was not sure how much will it cost after all the hassle is done.

1. Did you try doing a similar transfer? Or have you heard of someone doing such a transfer? How much did it cost?
2. Is opening an account and doing a transfer relatively simple? The website says it is but that does not mean much

[YouMeWeThem]

1. Since the transfer was not free for me does it mean I was not transferred?
2. Is it something I need to initiate deliberately?
3. Were you able to send USD to IBKR Japan for free from a Japanese bank account?

1. I suppose that's a sign you haven't been transferred yet. When I go to the "Deposit funds" screen I have the option of "Domestic transfer" or "International Bank Transfer".
2. I signed up last year so I've been on the Japan version the whole time. I'm not sure if you can have them switch you over manually rather than waiting, but it might be worth asking.
3. I've never tried sending USD, I send JPY into the account from my Japanese bank, and then IBKR automatically converts to USD at the current rate when I purchase a USD-denominated asset.

[Telebroker]

Hi Kanpanela,

I use IBKR LLC and frequently transfer JPY->JPY from SMBC [Olive] to IBKR's Citibank Account in Japan with 10 digit account number (=non-resident account) for a fee of JPY 800.

There is a whole thread on transferring to IBKR: https://www.retirejapan.com/forum/viewt ... 8&start=40
where I have also described alternative means and fees - which I believe are still current.

At the time my starting point was: https://kabu-yutai.com/2019/07/29/post-8845/
which guides you through the online transfer setup for the transfer to IBKR LLC.

Hope that helps!

[kanpanela]

Hi Kanpanela,

I use IBKR LLC and frequently transfer JPY->JPY from SMBC [Olive] to IBKR's Citibank Account in Japan with 10 digit account number (=non-resident account) for a fee of JPY 800.

There is a whole thread on transferring to IBKR: https://www.retirejapan.com/forum/viewt ... 8&start=40
where I have also described alternative means and fees - which I believe are still current.

At the time my starting point was: https://kabu-yutai.com/2019/07/29/post-8845/
which guides you through the online transfer setup for the transfer to IBKR LLC.

Hope that helps!

Thanks for the help @Telebroker !

You might have noticed but I actually participated in that conversation!
The thing is you transferred JPY from SMBC to IB, whereas I transferred USD.
I am guessing that due to that difference, IB gave you and me DIFFERENT accounts to transfer to. In your case it was a Japanese account which allowed for a domestic transfer, whereas in my case it was an American account which required an international transfer.

So I understand from this that I can avoid a 6000 fee and have a 800 yen fee instead if I opt for that option. In that case the question becomes how much I would pay in fees to convert the USD I have in SMBC to JPY and then convert them back to USD on IB’s side.

That still leaves the question of how to transfer USD to IB cheaply, however.

[Telebroker]

In your case it was a Japanese account which allowed for a domestic transfer, whereas in my case it was an American account which required an international transfer.

I am not sure I fully concur with your conclusions. Please note that the above assumption is false. While I do transfer JPY->JPY it is NOT a domestic transfer! As stipulated earlier, IBKR gives me a 10 digit account number with Citibank, N.A., Tokyo Branch (!) which is a non-resident account.
Thus most Mega-banks treat this as a cross boarder transfer i their fee schemes !

Please be aware of the important difference: Japanese domestic accounts in the zengin system have 7 digit account numbers (+3 digit branch codes) whereas non-Japanese accounts which require SWIFT transfers have different lengths, here 10 digits!

As I do the conversion to USD/EUR/... only once arrived at IBKR for their small FX fee (ca JPY 2xx), which is clearly the cheaper option when JPY is your starting point.
I am not sure on the fees for USD->USD transfers on the same track, but why don't you enquire with SMBC directly or read your way through the fee list, it all needs to be spelled out in details and you can then adapt accordingly to the cheapest niche. (I for example chose sender pays fees and was "un"pleased with a hefty JPY 2500 in addition to the JPY800 fee; once I switched to recipient pays, this JPY2500 just didn't occur anyway).

Not sure why your starting point is USD in Japan??, but have you ventured into transferring these to another bank like Shinsei, Sony Bank, Prestia, Rakuten or perhaps Wise and/or Revolut before sending off to IBKR? [Haven't operated with USD in Japan myself].

In your USD back to JPY scenario, you may want to also check what exchange rate SMBC would give you. Expectation would be that it is disadvantageous and will apply on top of the respective conversion fee anyway.

Lessons I learned in Japan are that conversions are better done elsewhere/ with a foreign bank/broker/transfer service. Thus move JPY first.

[kanpanela]

In your case it was a Japanese account which allowed for a domestic transfer, whereas in my case it was an American account which required an international transfer.

I am not sure I fully concur with your conclusions. Please note that the above assumption is false. While I do transfer JPY->JPY it is NOT a domestic transfer! As stipulated earlier, IBKR gives me a 10 digit account number with Citibank, N.A., Tokyo Branch (!) which is a non-resident account.
Thus most Mega-banks treat this as a cross boarder transfer i their fee schemes !

Sorry I got confused due to:

1. Mistaking the meaning of non-resident account in "I use IBKR LLC and frequently transfer JPY->JPY from SMBC [Olive] to IBKR's Citibank Account in Japan with 10 digit account number (=non-resident account) for a fee of JPY 800."
2. Having being told by SMBC staff (as I did went to talk with them) that non-domestic transfers would incur at least 3500 JPY fee (but actually 6,000 JPY like I had), as also is written in the PDF I linked to in the main thread https://www.smbc.co.jp/kojin/fee/resour ... aikoku.pdf on the first page's table. Perhaps I misunderstood something that they told me, but in that case I wonder how a transfer that only incurs 800 JPY fee sits with that table

Also in this wise blog post when they compare ways to send money, SMBC is listed with a 6,000 JPY fee.
https://wise.com/jp/blog/what-is-outbound-remittance
(Wise is listed with a 1,083 JPY fee which is very close to the JPY 800, so I'm tempted to try that)

Perhaps sending to such non-resident accounts is not considered an international transfer for the purposes of calculating fees?

The only difference I see between your transfer and mine are the currencies used, and the destination account which was probably chosen according to the currency used for the transfer.

Please be aware of the important difference: Japanese domestic accounts in the zengin system have 7 digit account numbers (+3 digit branch codes) whereas non-Japanese accounts which require SWIFT transfers have different lengths, here 10 digits!

Thanks! I will keep that in-mind!

As I do the conversion to USD/EUR/... only once arrived at IBKR for their small FX fee (ca JPY 2xx), which is clearly the cheaper option when JPY is your starting point.

Indeed that is what I would do as well if I had JPY to send.

I am not sure on the fees for USD->USD transfers on the same track, but why don't you enquire with SMBC directly or read your way through the fee list, it all needs to be spelled out in details and you can then adapt accordingly to the cheapest niche.

That is exactly what I did. After going to SMBC directly and having the table in the aforementioend PDF explained to me, I wrote this post to explain to other people what was explained to me. And that was mainly for two reasons:

1. Explain why according to SMBC (both website and the staff that spoke to me), their international transfer can not be, for us individual customers, less than 3,500 JPY
2. Ask the community how they were able to send overseas for less, in case they did recently, considering the above.

(I for example chose sender pays fees and was "un"pleased with a hefty JPY 2500 in addition to the JPY800 fee; once I switched to recipient pays, this JPY2500 just didn't occur anyway).

Indeed I had a similar experience. With the "recipient pays" option IBKR took 15 USD.

have you ventured into transferring these to another bank like Shinsei, Sony Bank, Prestia, Rakuten or perhaps Wise and/or Revolut before sending off to IBKR? [Haven't operated with USD in Japan myself].

That is what I'm tempted to try next. Wise sounds like the simplest option, but you listed at the tail of your list of suggesetions after a "or perhaps". Is there any gotcha I'm missing here or is there no deep meaning behind the phrasing?

Lessons I learned in Japan are that conversions are better done elsewhere/ with a foreign bank/broker/transfer service. Thus move JPY first.

Thanks! I will keep that in-mind as well!