A Japanese banker based in Washington has launched a mobile phone-based financial service to help immigrants in the U.S. without bank accounts send money to their home countries.
Hoping to help poor immigrants escape poverty, Atsumasa Tochisako, who operates Washington-based lender Microfinance International Corp., began the service in cooperation with major Japanese telecom carrier KDDI Corp., with an eye to expanding its reach to Hispanic immigrants in Japan in the future.
“Financial services should be offered for the sake of society,” Tochisako, 57, said. “We want to offer finance, the blood of the economy, to every corner of society. One tool to this end is an international remittance service using mobile phones.”
Migrants are estimated to transfer about ¥30 trillion globally each year.
But many immigrants have trouble opening banking accounts due to their unstable status and usually send money through agencies, which charge high commissions. Noting, however, that the immigrants often have mobile phones, Tochisako embarked on the service.
After forming a capital and business alliance with KDDI in December, MFIC launched its service, which allows customers to transfer up to $200 at a time internationally for $4 to $5.
Customers must buy a prepaid card and register with a designated call center. Money can be sent to participating banks without the need for either sender or receiver to have an account.
Tochisako set up MFIC to offer microfinance after quitting Bank of Tokyo-Mitsubishi, a predecessor of Bank of Tokyo-Mitsubishi UFJ, in 2003. Its latest service allows customers to send a small amount of money at low cost by utilizing an Internet-based system.
Tochisako got the inspiration for his business at age 26 while in Mexico, where he had been sent by his employer to study.
Invited by a family in northern Mexico into their mud house and treated to a cup of soup, Tochisako was shocked to see a 4-year-old boy named Jose overjoyed to eat a tiny piece of meat in the soup. He learned it was the first time the family had eaten meat in half a year.
Tochisako promised Jose he would become a financial professional in the future and give the boy a chance to escape from poverty. Jose died two years later from high fever, but Tochisako stuck to his goal.
Tochisako believes banks nowadays do not look to fulfill their primary task.
“They were crazy about the money game and let the rich gamble,” he said of the industry, referring to the subprime mortgage crisis that brought global financial upheaval in 2008.
“If you turn your eyes to the bottom, there is unlimited demand (for financial services),” he said.
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