Yen fixed deposit vs. cash exchange, which is more cost-effective?

In December 2025, the NT dollar against the Japanese Yen surged to 4.85, and suddenly more people are exchanging for Yen. Are you ready to exchange? Don’t rush to the bank—because choosing the wrong method could cost you an extra 1,500-2,000 NT dollars. We’ll explain four exchange channels once and for all, and tell you how to profit even after you’ve exchanged.

Why exchange Yen now?

First reason: Hedging. The Yen is one of the three major safe-haven currencies globally (along with USD and Swiss Franc). Last year, during the Russia-Ukraine war, the Yen appreciated by 8% in a week, while the stock market dropped 10%. Some people pre-exchanged Yen as a form of insurance for Taiwanese stocks.

Second reason: Appreciation. This year, the NT dollar against the Yen rose from 4.46 to 4.85, an 8.7% appreciation, allowing you to profit from the exchange difference. The Bank of Japan is about to raise interest rates to 0.75% (a 30-year high), leaving room for Yen to strengthen further.

Third reason: Interest rates. Yen fixed deposits offer an annual interest rate of 1.5-1.8%, which seems low but is higher than NT dollar deposits, providing steady interest income.

4 exchange methods, who saves the most?

Method 1: Bank counter cash exchange — the most expensive choice

Bring NT cash to the bank to exchange for Yen cash. It sounds simple, but it’s actually the biggest waste of money.

The reason is simple: banks use the “cash selling rate,” which is 1-2% worse than the spot rate. For example, Taiwan Bank’s cash selling rate on December 10, 2025, was about 0.2060 NT dollars per Yen (meaning 1 NT dollar = 4.85 Yen). The spread alone costs you less Yen. Some banks also charge an additional 100-200 NT dollars handling fee.

Exchanging 50,000 NT dollars could lose you 1,500-2,000 NT dollars.

✓ Advantages: Safe, quick, denominations available ✗ Disadvantages: Poor exchange rate, limited business hours, possible handling fees → Suitable only for urgent airport needs or small, temporary exchanges

Method 2: Online exchange, withdrawal at counter or ATM — moderate savings

Use bank app to convert NT dollars into Yen, stored in a foreign currency account, using “spot selling rate” (about 1% better than cash selling rate), then withdraw cash at ATM or bank.

The benefit is you can buy in installments. When the rate drops below 4.80, buy a little at a time, averaging your cost, instead of exchanging all at once.

The downside is that you pay a handling fee (5-100 NT dollars) when withdrawing cash, and foreign currency ATMs are limited (about 200 units nationwide).

Exchanging 50,000 NT dollars could lose you 500-1,000 NT dollars.

✓ Advantages: 24/7 access, installment buying, relatively good rates ✗ Disadvantages: Need a foreign currency account, withdrawal fees apply → Suitable for experienced forex investors or long-term holdings

Method 3: Online currency exchange, pick up at airport — the most cost-effective travel plan

This is the smartest way before traveling abroad. Reserve Yen on the bank’s website, fill in the amount and pick-up branch (e.g., Taoyuan Airport), then the next day, use ID + transaction notification to pick up cash directly.

Taiwan Bank’s “Easy Purchase” online exchange also waives handling fees (pay only 10 NT dollars via Taiwan Pay), with about 0.5% exchange rate advantage. There are 14 Taiwan Bank branches at the airport, including 2 open 24 hours.

Exchanging 50,000 NT dollars could lose you 300-800 NT dollars.

✓ Advantages: Favorable rates, often no handling fee, super convenient at the airport ✗ Disadvantages: Need to book 1-3 days in advance, cannot change branch → Best for travelers with detailed plans, before departure

Method 4: Foreign currency ATM withdrawal — the most flexible

Open 24/7, cross-bank fee only 5 NT dollars, directly debited from NT dollar account. E.SUN Bank’s foreign currency ATMs allow daily withdrawals of up to 150,000 NT dollars equivalent Yen, with no exchange fee.

The downside is limited ATM locations, cash often sold out during peak times (especially at airports and stations), and fixed denominations (1,000/5,000/10,000 Yen).

Exchanging 50,000 NT dollars could lose you 800-1,200 NT dollars.

✓ Advantages: Instant, flexible, cheap across banks ✗ Disadvantages: Limited locations, cash may run out → Suitable for urgent needs or when in a hurry

Cost comparison of the 4 methods (based on 50,000 NT dollars)

Conclusion: If you have time, online exchange is the most cost-effective. If you’re in a hurry, ATM withdrawal is a good second choice. Never go to the bank counter—it’s the most money-wasting option.

After exchanging Yen, don’t let your money sit idle

Many people just keep Yen after exchanging, waiting until they travel to use it, missing out on interest. Here are 4 options to make idle Yen productive:

1. Yen fixed deposit — conservative
The simplest way. E.SUN, Taiwan Bank offer online foreign currency accounts, deposit Yen with an annual interest rate of 1.5-1.8%, minimum 10,000 Yen. It’s like earning extra passively, ideal for short-term storage.

2. Yen insurance policy — medium-term holding
Cathay, Fubon life savings insurance, with guaranteed interest rates of 2-3%, for 3-5 years. If you don’t plan to use the Yen within 1-2 years, insurance is more cost-effective than fixed deposits.

3. Yen ETFs (00675U, 00703) — growth-oriented
Yuanta 00675U tracks Yen index, can buy fractional shares via brokerage app, suitable for regular investment. When Yen appreciates, you profit from the difference and receive dividends. Management fee is only 0.4% annually, low-cost.

4. Forex swing trading — high risk, high reward
If you’re confident in currency fluctuations, trade USD/JPY or EUR/JPY directly, 24/7 trading, long/short positions, with small capital. Not suitable for beginners, higher risk.

Advice for beginners: Fixed deposits are the most cost-effective. Deposit 10,000 Yen for 1 year, earning about 150-180 Yen interest. Not much, but steady, and keeps cash ready for travel.

Quick FAQ

Q: What’s the difference between cash exchange rate and spot rate?
Cash rate is the bank’s rate for physical banknotes, for immediate exchange and easy carrying, but worse (about 1-2% difference). Spot rate is the foreign exchange market’s T+2 settlement rate, used for non-cash transactions, more favorable but takes time.

Q: How much Yen can I get with 10,000 NT dollars?
Using Taiwan Bank’s cash selling rate of 4.85, about 48,500 Yen. Using online spot rate (~4.87), about 48,700 Yen, a difference of 200 Yen (roughly NT$40).

Q: What do I need to bring for counter exchange?
ID + passport (foreigners bring passport + residence permit). Under 20 needs parent’s accompaniment. Over NT$100,000 must declare source of funds. If pre-booked online, also bring transaction notification.

Q: What’s the daily limit for foreign currency ATM withdrawal?
Post-2025 regulations, most banks limit to 100,000-150,000 NT dollars equivalent Yen per day. CITIC, Taishin limit 120,000-150,000; E.SUN limit 50,000 per transaction. During peak times, cash may run out, so plan ahead or withdraw in parts.

Final advice

Yen is no longer just travel “pocket money,” but an asset with hedging and investment value.

If you plan to visit Japan next year, the most cost-effective way now is “online exchange + airport pickup.” If you want hedging or investment, gradually buy Yen fixed deposits, earning a steady 1.5-1.8% interest, more practical than NT dollar deposits.

The core principles are only two: buy in installments, and invest after exchange. This saves costs and prevents money from sitting idle without interest. Next time someone asks you how to get the best deal on Yen, you’ll know the answer.