In the era of NT dollar depreciation, what's the smartest way to exchange Japanese Yen? A practical comparison of 4 major currency exchange channels

Article Summary
The Japanese Yen is becoming an investment option for Taiwanese people beyond travel. This year, it has appreciated by 8.7%, with exchange rates reaching 4.85. Coupled with gradually rising interest rates in Japan, more and more people are seriously considering: how to exchange, when to exchange, and how to invest after exchanging. We have summarized four practical currency exchange methods and used real data to show you the cost differences.

Why is this wave of the Japanese Yen worth paying attention to?

When it comes to foreign currency investment, many people only think of the US dollar. But the Yen can offer different opportunities.

Travel demand rebounds
Japan has always been the top choice for Taiwanese traveling abroad, with cash still accounting for a large portion (credit card penetration is only 60%). This means every trip requires cash reserves.

Financial asset attributes
The Yen is one of the world’s three major safe-haven currencies (alongside the US dollar and Swiss franc). Japan’s economy is stable, with low debt levels, and during market volatility, funds often flow into the Yen for safety. During the Russia-Ukraine conflict in 2022, the Yen appreciated by 8% in a week, while the stock market fell by 10%, providing effective hedging. For Taiwanese investors, holding some Yen can offset the risk of fluctuations in the Taiwan stock market.

Interest rate optimization opportunities
The Bank of Japan is gradually raising interest rates. The Yen interest rate is rising from historically low levels. Currently, Japanese fixed deposit annual interest rates are around 1.5%-1.8%. Compared to short-term risks of arbitrage in USD, fixed deposits offer more stable returns. Meanwhile, the Governor of the Bank of Japan, Ueda Kazuo, has recently expressed hawkish signals, and the market expects the December meeting to raise rates to 0.75% (a 30-year high), indicating room for further Yen rate increases.

Four channels for Taiwanese to exchange Yen, with significant cost differences

Many think exchanging Yen is just going to the bank, but the handling fees and exchange rate differences of each method can significantly impact the overall cost. We analyze each one.

Method 1: Bank counter cash exchange
The most traditional way: bring cash NT$ to a bank or airport counter and exchange directly for Yen cash. It seems simple but has hidden costs. Banks use the “cash selling rate,” which is about 1-2% worse than the spot rate. For example, as of December 10, 2025, Taiwan Bank’s cash selling rate was about 0.2060 NT$/Yen (1 NT$ = 4.85 Yen). Different banks may charge an additional handling fee of NT$100-200.

Exchanging NT$50,000 costs about NT$1,500-2,000 in fees. Unless it’s urgent or for small amounts (like at the airport), it’s not cost-effective.

Advantages: Safe, full denominations, staff assistance on-site.
Disadvantages: Exchange rate spread, limited business hours, possible fees.
Suitable for: People unfamiliar with online operations or needing small, temporary exchanges.

Method 2: Online exchange + cash withdrawal
Log into bank app or online banking, convert NT$ to Yen in a foreign currency account, enjoying the “spot selling rate” (about 1% better than cash selling rate). If cash is needed, go to the counter or foreign currency ATM to withdraw, but additional exchange fee applies (minimum NT$100).

This method suits those who want to observe exchange rates and buy in batches at lower points. For example, E.SUN Bank charges a fee of NT$100-200, which is the difference between spot and cash rates.

Exchanging NT$50,000 costs about NT$500-1,000, saving 40-50% compared to Method 1.

Advantages: Operable 24/7, allows averaging over time, better rates.
Disadvantages: Need to open a foreign currency account, withdrawal fees apply.
Suitable for: Those experienced in forex, planning long-term holding or investment in Yen.

Method 3: Online currency conversion + airport pickup (most recommended for travelers)
No need for a foreign currency account. Fill in the amount online, choose the pickup branch, complete the transfer, then bring ID and transaction notice to pick up in person. Taiwan Bank’s “Easy Purchase” online currency exchange even waives handling fees (if paid via TaiwanPay, only NT$10). The exchange rate is about 0.5% better.

The biggest advantage is the ability to reserve airport branches for pickup. Taoyuan Airport has 14 Taiwan Bank outlets, 2 of which operate 24 hours. Book the day before departure, and pick up cash before boarding, saving queue time.

Exchanging NT$50,000 costs about NT$300-800, making it the most cost-effective choice for travelers.

Advantages: Better exchange rates, often no fees, airport pickup, time-saving.
Disadvantages: Need to book 1-3 days in advance, limited pickup times.
Suitable for: Planned travelers who want quick airport cash.

Method 4: Foreign currency ATM (24-hour emergency option)
Use a chip-enabled debit/credit card at foreign currency ATMs to withdraw Yen. Supports 24-hour operation. Deducts only NT$5 cross-bank fee from your NT$ account, avoiding exchange spread costs. Some banks like E.SUN Bank have a daily limit of NT$150,000 and no exchange fee.

Disadvantages: Limited locations (~200 nationwide), fixed denominations (1,000/5,000/10,000 Yen), risk of cash shortages during peak times.

Exchanging NT$50,000 costs about NT$800-1,200, suitable for last-minute needs.

Advantages: 24/7 instant access, low cross-bank fee, flexible.
Disadvantages: Limited locations, fixed denominations, potential cash shortages.
Suitable for: People who can’t visit banks or need urgent cash.

Cost comparison table of the 4 methods

Is now the right time to exchange Yen? Timing analysis

Current exchange rate
The NT$ to Yen rate has hit 4.85, up from 4.46 at the start of the year, appreciating 8.7%. In percentage terms, NT$1 million at the start of the year could buy about 22.4 million Yen; now it can buy 24.6 million Yen, an extra nearly 2.2 million Yen in gains.

Central bank signals pushing Yen higher
The Bank of Japan is expected to raise interest rates, with market expectations reaching 80%. Governor Ueda Kazuo has recently signaled hawkish stance, hinting at a rate hike of 0.25 basis points to 0.75% at the December 19 meeting, a 17-year high. Japanese bond yields have hit 1.93%, the highest since 2006. The US-Japan yield spread has narrowed from 4% at the start of the year. USD/JPY has fallen from 160 to 154.58, with long-term forecasts below 150.

Investment advice
Yes, there is an opportunity to exchange Yen now, but it’s not recommended to invest all at once. Short-term arbitrage risks could cause 2-5% fluctuations. It’s better to buy in installments monthly or quarterly, averaging the cost and reducing timing risks.

Post-exchange winning strategies: don’t let your money sit idle

After obtaining Yen cash or depositing into an account, don’t let it sit idle without interest. Based on your risk appetite, here are some options.

Conservative: Yen fixed deposit
Deposit Yen into a foreign currency account. Banks like E.SUN and Taiwan Bank offer fixed deposits starting from NT$10,000 Yen, with annual interest rates of 1.5%-1.8%, much higher than NT$ savings accounts. With Yen rates rising, this is a stable choice.

Mid-term: Yen insurance savings
Cathay, Fubon Life, and others offer Yen savings insurance with guaranteed interest rates of 2-3%, plus additional protection features, suitable for 3-5 years holding.

Growth: Yen ETFs
For example, Yuanta 00675U tracks Yen index, available as fractional shares via broker apps, suitable for regular investment. Management fee is only 0.4%, helping diversify currency risk over the long term.

Advanced: Forex swing trading
Experienced investors can trade USD/JPY or EUR/JPY directly on forex platforms. Mitrade and others offer commission-free, low-spread trading, supporting 24-hour trading to capture exchange rate fluctuations.

Quick FAQ

Q: What’s the difference between cash rate and spot rate?
Cash rate is the buy/sell rate banks offer for physical cash (banknotes and coins), used for travel exchanges, and is 1-2% worse than the spot rate. The spot rate is the FX market rate settled T+2, used for electronic transfers, offering better rates but requiring settlement time.

Q: How much Yen can NT$10,000 buy?
Based on December 2025 cash selling rate of 4.85, NT$10,000 ≈ 48,500 Yen. Using the spot rate (~4.87), about 48,700 Yen. The difference is about 200 Yen (~NT$40).

Q: What ID do I need for counter exchange?
Taiwanese need to bring ID card + passport. If pre-booked online, also bring transaction notice. For amounts over NT$100,000, may need to declare source of funds. Under 20 years old must be accompanied by a parent.

Q: What’s the daily withdrawal limit at foreign currency ATMs?
Varies by bank. CTBC, Taishin Bank limit around NT$120,000-150,000 daily; E.SUN Bank limit is NT$150,000. Consider splitting withdrawals or using your bank card to avoid cross-bank fees.

Final advice

The Yen has evolved from a simple “travel pocket money” to an asset allocation tool with hedging and yield potential. Year-end and start-of-year are peak exchange periods, but rather than blindly following the trend, choose the method that best suits your needs.

Beginners are recommended to start with “Taiwan Bank online currency exchange + airport pickup” or “foreign currency ATM.” Once the cash part is settled, transfer Yen into fixed deposits or ETFs based on amount and duration to earn Yen interest. This way, you can enjoy cost-effective travel and add a layer of protection during market turbulence. The depreciation of the NT$ is a crisis but also an opportunity for asset diversification.