History of the foreign exchange (Forex) in Japan

Where is the forex coming from? Looking up the former days, it started from the word, "Kae-zeni" or "Kae-sen" in Kamakura, Muromachi era. It meant to make loans to poor farmers who were not able to pay full taxes, and the lenders were always some riches. Especially the alcohol makers played a roll of the main cast in the economy in those days.

Coming down to Edo era, they developed their business and expanded the financial service to the reimbursement. In Edo, the economy grew by increase of consumption, and many merchants needed to purchase the food and materials from Osaka which had the biggest market. As a result, Japanese exchange style, 'Kawashi' was born out. Those activities brought about a lot of fund transfer between Edo and Osaka for the sake of purchase and sales. It follows that some capital merchants began to settle only on the bookkeeping without the actual fund transfer. The money to be payable was called as 'Kawashi-gin'. This is just the prototype of remittance, so called, the domestic exchange the modern banks operates every day.

Before long, they became banks, which means transportation of silver in Japanese. For your information, the Japanese authority does not allow the exchange operation besides banks.