How to buy Japanese Yen? Understand the 4 most cost-effective exchange methods for 2025 in one go

2025 has entered the end of the year, and the TWD to JPY exchange rate is about 4.85, up 8.7% from 4.46 at the beginning of the year. Whether you are a traveler planning a trip to Japan next year or an investor looking to hedge Taiwan stocks with JPY, now is a good time to pay attention to JPY allocation. But the key question is: how to exchange without losing out?

We have compiled the latest four major channels for obtaining JPY in 2025 to help you find the most cost-effective option among many choices.

Is JPY worth investing in? A comprehensive analysis from travel to hedging

Many people see currency exchange for JPY as a routine before going abroad, but in reality, JPY plays a more complex role in Taiwanese asset allocation.

Practical needs in daily life

Japan’s cash-based society is deeply ingrained, especially at tourist spots and small to medium-sized shops, where credit card penetration is only 60%. If you plan to shop in Tokyo, ski in Hokkaido, or vacation in Okinawa, pre-exchanging cash in JPY is almost a must. Additionally, for purchasing via proxy, online shopping in Japan, or planning to study and work in Japan, direct transactions in JPY are necessary.

Strategic value in global financial markets

From an investment perspective, JPY is one of the world’s three major safe-haven currencies, alongside USD and CHF. When geopolitical risks rise or stock markets fluctuate sharply, capital flows into JPY. During the Russia-Ukraine conflict in 2022, JPY appreciated by 8% in a week, successfully buffering a 10% decline in global stock markets. For Taiwanese investors, holding a moderate proportion of JPY assets can provide stability during Taiwan stock market volatility.

Even more important is the policy trend of the Bank of Japan. Governor Ueda recently made hawkish comments, and the market expects the December 19 meeting to raise interest rates by 0.25 bps to 0.75% (a 30-year high). The yield on 10-year Japanese government bonds has reached 1.93%, a 17-year high. This indicates that the interest rate environment for JPY is improving, making long-term deposits or interest income more attractive.

What will be your cost to acquire JPY? Four major options analyzed

Exchanging JPY is not just about going to a bank to exchange cash. Different channels can produce a 1-2% exchange rate spread, which can amount to NT$500-2,000 difference on NT$50,000. Here are the four most practical options in 2025.

Option 1: Traditional counter exchange — safest but most costly

Bring NT$ to a bank or airport counter to exchange for JPY cash. The advantage is safety, reliability, and full denominations (1,000, 5,000, 10,000 JPY), with bank staff assisting throughout.

The downside is using the “cash selling rate,” which is about 1-2% worse than the spot rate. For example, Taiwan Bank’s rate on December 10, 2025, is about 0.2060 TWD/JPY (NT$1 = 4.85 JPY), plus a handling fee of NT$100-200.

Calculating this, exchanging NT$50,000 yields a loss of NT$1,500-2,000. Suitable for those unfamiliar with online operations or needing small emergency exchanges.

Option 2: Online currency exchange into account — suitable for long-term rate observation

Use bank apps or online banking to convert NT$ into JPY and deposit into a foreign currency account. This uses the “spot sell rate,” about 1% better than cash exchange. If later you need to withdraw cash, you can do so at counters or foreign currency ATMs, but with additional exchange spread fees (from NT$100).

Advantages include 24-hour operation, allowing phased entry to average costs. If you believe the rate may still decline, you can buy in stages at lower points (e.g., when NT$ to JPY is below 4.80). Cost loss is about NT$500-1,000.

This option is most suitable for experienced forex investors, as after transferring to a foreign currency account, you can consider buying JPY time deposits (current annual interest 1.5-1.8%) or JPY savings insurance (guaranteed interest rate 2-3%), generating passive income.

Option 3: Pre-arranged online currency exchange with airport pickup — best before departure

No need to open a foreign currency account. Fill in currency, amount, pickup branch, and date on the bank’s website. After remittance, just bring ID and transaction notice to the designated branch for pickup. Taiwan Bank’s “Easy Purchase” online exchange has no handling fee (pay NT$10 via TaiwanPay), with about 0.5% exchange rate advantage.

Notably, Taiwan Bank has 14 service points at Taoyuan Airport, including 2 open 24 hours. If you plan to travel during Chinese New Year or summer next year, you can book 3-7 days in advance and pick up JPY cash at the airport before departure. Cost loss is NT$300-800.

This is most convenient for well-planned travelers, saving the hassle of last-minute bank visits.

Option 4: Foreign currency ATM cash withdrawal — most flexible emergency option

Use a chip-enabled debit card at foreign currency ATMs to withdraw JPY cash. Major banks like E.SUN Bank support this, with 24-hour operation, and a NT$5 cross-bank fee deducted from your NT$ account. Daily withdrawal limit is about NT$150,000 equivalent, with no exchange fee.

The downside is limited locations (about 200 nationwide), fixed denominations (usually 1,000, 5,000, 10,000 JPY), and possible cash shortages during peak times. Note that Japan’s ATM withdrawal service will be adjusted by the end of 2025, requiring international cards (Mastercard/Cirrus).

Cost is about NT$800-1,200 loss, best for urgent needs or last-minute withdrawals.

Comparison of the four major options

Is it really cost-effective to exchange JPY now?

By the end of 2025, the TWD to JPY rate is about 4.85, up 8.7% from the start of the year. This is a relatively favorable level.

Looking at market trends, forex demand in Taiwan has increased by 25% in the second half of the year compared to the beginning, driven mainly by two factors: the recovery of travel to Japan (returning to pre-pandemic levels) and diversification of assets (hedging against TWD depreciation).

Short-term volatility vs. long-term allocation

The BOJ’s rate hike expectations support JPY, but global arbitrage unwinding and geopolitical risks may cause short-term fluctuations. USD/JPY has fallen from a high of 160 at the start of the year to around 154.58, with a short-term test of 155 possible, but medium to long-term forecasts suggest below 150.

For investment purposes, JPY is suitable for hedging Taiwan stock market fluctuations. However, note that short-term arbitrage unwinding can cause 2-5% volatility. It’s recommended to adopt a “phased entry, diversify timing” strategy to avoid chasing high prices with a one-time exchange.

After exchanging for JPY, how to utilize it?

Don’t let your JPY sit idle after exchange. Based on your investment goals and risk tolerance, four common allocations are:

Option 1: JPY time deposit — conservative and stable Open a foreign currency account at E.SUN Bank or Taiwan Bank, deposit JPY online. Minimum NT$10,000, annual interest 1.5-1.8%. Suitable for those with no immediate use plans who want steady interest income.

Option 2: JPY savings insurance — medium-term capital preservation Buy savings insurance products from Cathay or Fubon Life, with guaranteed interest rates of 2-3%. Usually 3-5 years, combining principal protection and interest earnings.

Option 3: JPY ETF — growth-oriented Purchase ETFs tracking the JPY index, such as Yuanta 00675U. Can buy fractional shares via brokerage apps, suitable for regular investment. Management fee 0.4% annually, with higher risk and return than deposits.

Option 4: Forex trading — swing trading Trade JPY currency pairs directly on forex platforms, such as USD/JPY or EUR/JPY. Advantages include two-way trading, 24-hour operation, and small capital requirements, suitable for experienced traders.

Regardless of the chosen method, remember that JPY, while a hedge, also has two-way volatility. BOJ rate hikes are positive, but arbitrage unwinding and geopolitical risks can also depress the exchange rate. Diversification remains a long-term strategy.

Common questions about exchanging JPY

Q: What’s the difference between cash exchange rate and spot rate?

Cash rate refers to buying and selling physical cash (bills/coins), with the advantage of immediate delivery but usually 1-2% worse than the spot rate. Spot rate is the foreign exchange market rate for settlement within two business days, used for electronic transfers and account transactions, closer to international market prices but requires T+2 settlement.

Q: How much JPY can I get with NT$10,000?

Based on Taiwan Bank’s rate on December 10, 2025, cash selling rate is about 4.85 (NT$1 = 4.85 JPY), so NT$10,000 can exchange for about 48,500 JPY. Using the spot selling rate (about 4.87), it’s approximately 48,700 JPY.

Q: Are there limits on foreign currency ATM withdrawals?

ATM withdrawal limits vary by bank after the 2025 regulation update. For example: CTBC Bank NT$120,000 per transaction/day; Taishin Bank NT$150,000 per transaction/day; E.SUN Bank NT$50,000 per transaction, NT$150,000 per day (including card swipe). Using other bank cards usually results in lower limits. During peak times (like airports), cash may run out; plan ahead.

Q: What documents are needed for large exchanges?

For counter cash exchange, Taiwanese citizens need ID + passport; foreigners need passport + residence permit. For company exchanges, business registration proof is required. Minors under 20 need parental consent and ID. For amounts over NT$100,000, a source of funds declaration may be required.

Final advice

In 2025, JPY is no longer just “travel pocket money,” but an asset with practical and investment value. By following the two principles of “phased exchange” and “not leaving funds idle after exchange,” you can minimize costs and maximize returns.

The simplest entry options for beginners are “Taiwan Bank online exchange + airport pickup” or “urgent foreign currency ATM withdrawal.” After acquiring JPY, you can then allocate into deposits, ETFs, or forex trading based on your needs. This way, you can enjoy more cost-effective travel and add a layer of protection during global market fluctuations.