Comprehensive Guide to Yen Exchange: Cost Comparison of 4 Major Ways to Convert TWD to JPY

In December 2025, the exchange rate of the New Taiwan Dollar (NTD) against the Japanese Yen (JPY) reached 4.85, up approximately 8.7% from 4.46 at the beginning of the year. Whether preparing for travel abroad or considering small-scale hedging, the demand for exchanging to Yen continues to rise. But did you know? Choosing the wrong method to exchange Yen could cost you an extra NT$2,000 for the same amount. This guide will clarify the cost differences among Taiwan’s five major currency exchange channels and reveal mechanisms as cost-effective as exchanging NT$1,000 for VND.

Why is Yen the preferred currency for exchange?

When it comes to currency exchange, many people instinctively think of Yen. This is not only because Japan is a popular travel destination but also due to Yen’s dual identity.

Everyday use: Japanese cash usage remains high (credit card penetration about 60%), with most shops in Tokyo shopping districts, Hokkaido ski resorts, and Okinawa resorts only accepting cash. Taiwanese consumers buying Japanese cosmetics, fashion, or anime merchandise also need to transact directly in Yen. Those planning long-term stays or working holidays in Japan will also exchange currency in advance to avoid costs from sudden fluctuations.

Financial assets perspective: Yen ranks among the world’s three major safe-haven currencies (alongside USD and CHF). During the Russia-Ukraine conflict in 2022, Yen appreciated 8% in a single week, effectively hedging a 10% stock market decline. For Taiwanese investors, exchanging to Yen is not only convenient for travel but also a tool for asset allocation to hedge against Taiwan stock market volatility.

Additionally, Japan maintains ultra-low interest rates (only 0.5%), making Yen a primary financing currency for global arbitrage trading. Many institutions borrow Yen at low interest to invest in higher-yield USD assets (with a USD-JPY interest rate differential of up to 4.0%), which also explains why Yen fluctuations often trigger market volatility.

Is now a good time to exchange Yen? Timing analysis

Short-term exchange rate trend: USD/JPY has fallen from a high of 160 at the start of the year to 154.58, with a possible short-term rebound to around 155, but medium to long-term forecasts suggest below 150. The Bank of Japan’s Governor Ueda Kazuo recently made hawkish comments, raising market expectations of rate hikes to 80%, with a 0.25 basis point increase to 0.75% expected at the December 19 meeting (a 30-year high), and Japanese government bond yields reaching a 17-year high of 1.93%.

Investment judgment: It is indeed a good time to exchange Yen now, but must do so in installments. While Yen has safe-haven attributes, there is a short-term arbitrage closing risk of 2-5%. It’s recommended to enter gradually to average costs. Taiwan’s currency exchange demand increased by 25% in the second half of the year, mainly driven by travel recovery and hedging needs, reflecting genuine market demand for Yen.

Cost comparison of Taiwan’s 4 major Yen exchange channels

Many think exchanging Yen just involves going to a bank, but in reality, even the exchange rate difference can cost you the price of a lunch. Here’s a breakdown of the actual costs for each channel.

1. On-site cash exchange: Most conservative but highest cost

Carrying NT$ cash directly to a bank branch or airport counter to receive Yen cash. This traditional method uses the “cash selling rate” (about 1-2% worse than the spot rate), resulting in higher overall costs.

For example, Taiwan Bank’s rate on December 10, 2025, is about NT$0.2060 per Yen (meaning NT$1 exchanges for 4.85 Yen). Some banks also add a fixed handling fee of NT$100-200.

Comparison of cash selling rates and fees (as of December 10, 2025):

Suitable for: Urgent airport needs, small amounts, unfamiliar with online methods.

Cost estimate: Exchanging NT$50,000 results in a loss of about NT$1,500-2,000.

2. Online currency exchange with foreign currency account: Suitable for investors

Via online banking or app, using “spot selling rate” (about 1% better than cash rate) to buy Yen and deposit into a foreign currency account. If cash withdrawal is needed, on-site or ATM withdrawal incurs additional exchange spread fees (around NT$100+).

E.SUN Bank’s app allows observing exchange rates and making phased purchases at low points, ideal for long-term holdings. Many investors also buy Yen deposits (current annual interest 1.5-1.8%) to generate passive income.

Suitable for: Those with forex investment experience, long-term Yen holders, seeking to grow savings via deposits.

Cost estimate: NT$50,000 exchange results in a loss of NT$500-1,000.

3. Online remittance for airport pickup: Best pre-departure plan

No need for a foreign currency account. Fill in amount, branch, date online, transfer, then bring ID and transaction notice to pick up cash at the counter. Taiwan Bank’s “Easy Purchase” online remittance is fee-free (using Taiwan Pay costs NT$10), with about 0.5% exchange rate advantage.

Taoyuan Airport has 14 Taiwan Bank outlets (including 2 24-hour), making it a convenient choice before departure. Mega Bank offers similar service.

Suitable for: Planned travelers, those who want to pick up cash at the airport, need funds within a week before departure.

Cost estimate: NT$50,000 exchange results in a loss of NT$300-800.

4. Foreign currency ATM withdrawal: Most flexible timing

Using chip-enabled debit cards at foreign currency ATMs to withdraw Yen cash, open 24 hours, cross-bank fee only NT$5. With Fubon Bank’s foreign currency ATM, withdrawal from NT$ account, daily limit NT$150,000, no exchange fee.

However, there are about 200 ATMs nationwide, with fixed denominations (1,000, 5,000, 10,000 Yen). During peak times, cash may run out. It’s advised not to wait until the last minute before travel.

Suitable for: Urgent needs, no time to visit bank, requiring 24-hour flexibility.

Cost estimate: NT$50,000 exchange results in a loss of NT$800-1,200.

Summary table of the four methods:

Difference between cash rate and spot rate

Cash Rate: The bank’s buy/sell rate for physical cash, settled immediately. It’s convenient but usually 1-2% worse than the spot rate, plus possible fees, making it the most costly.

Spot Rate: The foreign exchange market’s T+2 settlement rate, used for electronic transfers and non-cash transactions. Closer to international market price but involves waiting for settlement.

Example: NT$50,000 cash exchange at 4.85 yields about 242,500 Yen; using spot rate 4.87 yields about 243,500 Yen, a difference of roughly 1,000 Yen (NT$200).

Financial options after exchanging Yen

Once you have Yen, don’t let the money sit idle without interest. Here are four suitable options for small-scale beginners.

Yen fixed deposit: Stable, open with E.SUN or Taiwan Bank, online deposit from as low as 10,000 Yen, annual interest 1.5-1.8%.

Yen insurance policies: Cathay, Fubon life savings insurance, with guaranteed interest rates of 2-3%.

Yen ETFs: Such as Yuanta 00675U, 00703, tracking Yen index, can be bought in fractional shares via broker apps, management fee 0.4% annually.

Forex trading: Directly trade USD/JPY or EUR/JPY pairs, 24/7, long/short, low spreads, no commission, suitable for capturing exchange rate swings.

While Yen is a safe-haven, it also involves two-way volatility risk. The BOJ’s rate hikes support, but global arbitrage unwinding or geopolitical conflicts could depress the Yen. Diversify assets to avoid over-concentration.

FAQs

Q: How much Yen can NT$10,000 buy?

Using formula: Yen amount = NT$ amount × current rate

At Taiwan Bank’s cash rate 4.85, NT$10,000 ≈ 48,500 Yen; at spot rate 4.87, ≈ 48,700 Yen. Difference about 200 Yen (NT$40).

Q: What ID to bring for on-site exchange?

Taiwanese: ID card + passport; foreigners: passport + residence permit; companies: business registration. For online booking, also bring transaction notice. Under 20 need parent’s consent; amounts over NT$100,000 may require source declaration.

Q: Is there a limit for foreign currency ATM withdrawal?

Limits vary by bank. CTBC: NT$120,000 equivalent/day; Taishin: NT$150,000; E.SUN: NT$150,000 (including card spending). Others depend on issuing bank. Post-2025 regulations, daily limits often reduced to NT$100,000-150,000. To avoid fees, consider splitting withdrawals or using your own bank card.

Q: When is the best time to exchange Yen at the lowest cost?

Observe USD/JPY trend: currently 154-155, medium-long term below 150. Expect fluctuations around BOJ rate hikes. It’s best to buy in installments to average costs rather than all at once. During peak airport times (holidays), cash may run out, so plan ahead to avoid high-cost emergency exchanges.

Final recommendations

Yen is no longer just travel pocket money but also an asset with hedging and investment value. Now is a good time to exchange, but the key is gradual exchange + continuous value growth.

Beginners can start with “Taiwan Bank online remittance + airport pickup” or “foreign currency ATM,” then move into deposits, ETFs, or forex trading based on needs. This way, you can enjoy cost-effective travel and asset protection amid global market turbulence. The goal is to minimize exchange costs and maximize returns.