How to exchange Japanese Yen to get the best value? The exchange rate trap that Taiwanese people most easily overlook

In December 2025, the NT dollar to Japanese Yen has risen to 4.85, and many people are preparing to travel abroad or invest in Yen. But do you know? Just choosing the wrong currency exchange channel can cost you over 2,000 NT dollars unnecessarily. This article breaks down the most common currency exchange methods on the market to help you avoid detours.

Why is exchanging Yen now worth paying attention to?

When it comes to foreign currency exchange, many people first think of Yen. This is not only because Japan travel is popular, but more importantly, because the Yen holds a special position in the global financial markets.

Everyday needs: travel and shopping

Traveling in Japan, most department stores in Tokyo and shopping districts in Osaka still only accept cash (credit card penetration is only 60%). Shopping and anime merchandise enthusiasts often need to pay directly in Yen. Students studying abroad or working holidaymakers also need to lock in exchange rates in advance to hedge risks.

Investment aspect: one of the three major safe-haven currencies

The Yen, along with the US dollar and Swiss franc, is one of the world’s three major safe-haven assets. When the Russia-Ukraine war broke out in 2022, the Yen appreciated 8% in a week while the stock market fell 10%, demonstrating its safe-haven effect. For Taiwanese investors, holding Yen is like buying insurance for Taiwan stocks.

Even more interesting is Japan’s ultra-low interest rate (only 0.5%), which creates arbitrage opportunities. Many funds borrow Yen at low interest, convert to high-yield USD investments (USD-JPY interest rate differential of 4%), profit from the spread when the market is good, and buy Yen when risks increase, forming a complete trading logic.

How big is the cost difference when exchanging Yen?

This is a question most people haven’t considered. Exchanging 50,000 NT dollars can have a cost difference of 1,500 to 2,000 NT dollars depending on the method. In other words, you might be wasting a meal’s worth of money.

Where is the problem? The key lies in the “exchange rate difference.” The “cash selling rate” used at bank counters is 1-2% worse than the market rate, plus different handling fees policies, which ultimately disadvantages consumers the most.

For example, Taiwan Bank’s December 10th rate is about 0.2060 (meaning 1 NT dollar = 4.85 Yen), but online spot selling rates can reach 4.87. The difference seems small, but exchanging 50,000 NT dollars results in a 200 Yen, or about 40 NT dollars, gap. When multiplied by other fees, the cost difference becomes immediately apparent.

The 4 most common currency exchange methods used by Taiwanese people, with real cost comparisons

Method 1: Bank counter, most convenient but most expensive

Exchange NT dollars for Yen cash directly at bank or airport counters. Simple process, suitable for those unfamiliar with online operations or urgent needs.

But this method has the highest cost. Besides the exchange rate difference (cash selling vs. spot), you also need to consider handling fees charged by banks. E.g., E.SUN and Taipei Fubon charge 100-200 NT per transaction, Yongfeng also charges 100 NT, only major banks like Taiwan Bank, Mega, and CITIC are free.

Test result: exchanging 50,000 NT dollars costs about 1,500-2,000 NT dollars in losses. Suitable for only two types of people—elderly who do not use the internet at all, or those who need cash urgently at the airport.

Current bank status (December 2025):

• Taiwan Bank: cash selling rate 0.2060, no handling fee
• E.SUN Bank: cash selling rate 0.2067, handling fee 100 NT/transaction
• Cathay United Bank: cash selling rate 0.2063, handling fee 200 NT/transaction

Method 2: Online currency exchange + foreign currency account, requires pre-preparation

Open a foreign currency account via bank app, convert NT dollars to Yen online, and store in the foreign currency account. This uses the “spot selling rate,” which is about 1% better than counter rates.

If you want to withdraw cash, you can do so via counters or foreign currency ATMs, but this incurs an additional withdrawal fee (usually starting at 100 NT).

Advantages include the ability to buy in installments and time your purchases. When the rate drops below 4.80, buy more; when above 4.90, buy less, using periodic or band trading to lower average costs. Coupled with Yen fixed deposits (current annual interest rate 1.5-1.8%), you can earn interest while exchanging.

Disadvantages: the threshold is higher—requires opening an account, familiarizing with the app interface, and has a learning curve for beginners.

Real cost: about 500-1,000 NT loss (50% better than counter).

Method 3: Online currency exchange + airport pickup, a must for office workers

Pre-arrange currency exchange via bank website, no need for a foreign currency account. Enter amount, pickup time, and branch, then complete remittance and bring ID and notification to pick up cash at the counter. Taiwan Bank’s “Easy Purchase” special offer: pay with TaiwanPay for only 10 NT, and no exchange handling fee, with a 0.5% better rate.

The biggest advantage is the ability to reserve airport branch pickup. Taoyuan Airport has 14 Taiwan Bank outlets, including 2 open 24 hours. Picking up cash the day before or on the morning of departure is very convenient.

Disadvantage: requires advance planning, usually 1-3 days reservation.

Real cost: about 300-800 NT loss (most cost-effective).

Method 4: Foreign currency ATM, fastest for urgent needs

Use a chip-enabled bank card at foreign currency ATMs to withdraw Yen cash directly, operable 24/7. Yongfeng Bank allows withdrawal of Yen from NT account, with a daily limit of 150,000 NT, no currency exchange fee, and only 5 NT cross-bank fee.

Looks very convenient, but the devil is in the details. There are about 200 foreign currency ATMs nationwide, far fewer than regular ATMs, and cash may run out during peak times (like airports). Denominations are fixed at 1,000, 5,000, and 10,000 Yen, no customization.

Latest reminder: Japan’s ATM withdrawal service will be adjusted by the end of 2025, and Taiwan financial cards will no longer be supported; you will need to use international cards like Mastercard or Cirrus.

Real cost: about 800-1,200 NT loss.

Which method should I choose? Categorized by budget and time

Budget 50,000-100,000 NT, ample time → Online exchange + airport pickup (lowest cost, save 300-800 NT)

Budget 50,000-100,000 NT, urgent need → Foreign currency ATM or counter exchange (costs more but saves time)

Long-term Yen investment, over 200,000 NT → Online exchange + foreign currency account, staggered entry (reduces risk, can also earn interest via fixed deposits)

Urgent cash needs abroad → International card at Japanese ATM, but note new regulations may not support Taiwanese cards

Is now the right time to act?

At the start of the year, the NT dollar to Yen was about 4.46; now in December, it’s 4.85, appreciating 8.7%. This indicates Yen is strengthening.

But just because it’s strong now doesn’t mean you should buy all at once. The Bank of Japan Governor Ueda Haruhiko recently signaled a hawkish stance, and the market expects a rate hike to 0.75% on December 19 (a 30-year high), with Japanese bond yields reaching a 17-year high of 1.93%. USD/JPY has fallen from 160 to 154.58 since the start of the year, and may return to 155 in the short term, but medium to long-term forecasts suggest below 150.

In other words, Yen’s short-term volatility still has 2-5%. Don’t exchange all at once; staggered purchases are the best strategy.

Example: planning to exchange 100,000 NT, split into 4 transactions of 25,000 each, spaced one week apart. This can average out exchange rate risks and observe market trends.

After exchanging Yen, what’s next? Don’t let your money sit idle

Once you get Yen, don’t just leave it there, or it will lose value with no interest. Here are some common ways to grow your Yen:

Yen fixed deposit — annual interest rate 1.5-1.8%, E.SUN and Taiwan Bank require at least 10,000 Yen, safest option.

Yen ETFs — Yuanta 00675U tracks Yen index, can buy fractional shares, suitable for dollar-cost averaging. Management fee 0.4%.

Yen insurance policies — Cathay and Fubon life savings insurance, guaranteed interest 2-3%, suitable for medium-term allocation.

Forex trading — operate USD/JPY or EUR/JPY directly on trading platforms to catch swing opportunities. Both long and short positions, 24/7, but higher risk.

Choosing depends on your risk appetite. Conservative: fixed deposits or insurance; aggressive: ETFs or forex. A mix is best—60% stable income from deposits, 30% growth from ETFs, 10% flexible forex trading.

Common misconceptions about currency exchange

Misconception 1: Is the cash rate the same as the spot rate?

No. The cash rate is the bank’s price for physical cash, usually 1-2% worse than the market rate. The spot rate is used for electronic transfers, close to international market prices, settled T+2. Simply put, cash is more expensive, electronic transfers are cheaper.

Misconception 2: How much Yen do I get for 10,000 NT?

At the current 4.85 rate, 10,000 NT equals about 48,500 Yen. But if using counter cash selling rate (about 4.83), you only get 48,300 Yen, a difference of 2,200 Yen (about 440 NT).

Misconception 3: What documents are needed for currency exchange?

For counters, ID + passport. If pre-arranged online exchange, also bring transaction notification. Large amounts (over 100,000 NT) may require source of funds declaration. Under 20, need parental accompaniment.

Misconception 4: Are there withdrawal limits at ATMs?

Yes. After the 2025 regulation, daily Yen withdrawal limits at many banks are reduced to 100,000-150,000 NT. During peak times (airports, tourist spots), cash may run out, so plan ahead.

Misconception 5: Can I still use Taiwanese cards at Japan ATMs?

Until the end of 2025, yes. After that, you need to use international cards like Mastercard or Cirrus. Plan accordingly if traveling soon.

Currency exchange and global fluctuations, think one more layer

Yen is a safe-haven, but also fluctuates bidirectionally. Rate hikes benefit Yen, but global arbitrage unwinding or geopolitical conflicts (Taiwan Strait, Middle East) may suppress it.

If for investment, don’t just look at the exchange rate; consider the overall environment. Factors like Fed rate cuts, Bank of Japan rate hikes, and Taiwan dollar depreciation combine to make Yen’s short-term movements unpredictable. Staggered trading remains the best approach.

Also, don’t forget other currencies like HKD/USD, KRW, which also fluctuate. Some diversify holdings across multiple currencies to reduce single-currency risk, which is another strategy.

Summary: 2 key points for exchanging Yen

Exchanging Yen isn’t complicated, but requires strategy. Remember two points:

First, choose the right channel to save costs — online exchange + airport pickup is most cost-effective, saving 300-800 NT.

Second, don’t buy all at once; stagger your purchases — Yen still has short-term volatility, and multiple entries can spread risk.

Whether for travel, shopping, or asset allocation, mastering these principles can elevate Yen from “travel pocket money” to “hedging + asset growth.” Good luck with your currency exchange.