Yen investment is popular! Master the 4 most cost-effective exchange methods at once

Is it really cost-effective to exchange for Japanese Yen now? Check the exchange rate first and then decide

As of December 10, 2025, the TWD to JPY exchange rate reached 4.85, appreciating about 8.7% since the beginning of the year. What does this mean? If you hold $300 USD, equivalent to about NT$9,400, during the same period, the USD/JPY also experienced significant fluctuations, dropping from 160 at the start of the year to 154.58 now. For Taiwanese investors, the current return on exchanging for JPY is quite attractive.

According to the latest market observations, Taiwan’s foreign exchange demand in the second half of the year grew by 25%, mainly driven by two factors: a recovery in Japanese tourism and increased hedging activities by institutional investors. The recent hawkish comments from Bank of Japan Governor Ueda Kazuo pushed the rate hike expectations to 80%, with a 0.25 bps increase expected at the December 19 meeting (a 30-year high), supporting the long-term appreciation of the yen.

Why are professional investors all positioning in JPY?

Many think the yen is just a travel currency, but from an investment perspective, the yen has long become a core asset in the global financial markets.

Strongest Hedging Function: The yen, along with the USD and Swiss Franc, ranks as one of the three major safe-haven currencies worldwide. During the Russia-Ukraine conflict in 2022, the yen appreciated by 8% in a single week, while the stock market fell by 10%, successfully hedging against risk assets. For Taiwanese investors, holding yen isn’t just for travel; it also helps hedge against Taiwan stock market volatility.

Preferred Financing Currency for Arbitrage: Japan maintains ultra-low interest rates (only 0.5%), making the yen the cheapest “financing currency.” Many fund managers borrow in low-interest yen to invest in higher-yield USD assets (USD/JPY interest rate differential of 4.0%), then close positions when risk increases to buy back yen for profit. This carry trade existence makes yen fluctuations more predictable.

Solid Economic Fundamentals: Despite high debt levels, Japan’s debt is manageable, and the central bank’s large balance sheet and stable economic growth underpin the yen’s creditworthiness.

Four comprehensive ways to exchange JPY

There are many channels to buy yen, but price differences could cost you an extra NT$1,500-2,000. We analyze each method’s costs and suitable scenarios.

Method 1: Bank Counter Cash Exchange — The most traditional but most expensive

This is the most common method: bringing cash in TWD to a bank or airport counter to buy yen cash. It’s simple but uses the “cash selling rate” (about 1-2% above the spot rate), resulting in higher costs.

For example, Taiwan Bank’s rate on December 10, 2025, at 9:18 AM was about NT$0.2060 per yen, so NT$50,000 can buy approximately 242,718 yen. Plus fixed handling fees (NT$50-200), total costs are around NT$1,500-2,000.

Advantages: Safe, full denominations, in-person assistance, suitable for first-time exchange or small amounts.
Disadvantages: Limited operating hours (weekday 9:00-15:30), worst exchange rate, requires bank procedures.
Suitable for: Travelers unfamiliar with online methods or urgent cash needs at the airport.

Major banks’ cash selling rates (2025/12/10):

• Taiwan Bank: 0.2060 (no fee)
• Mega Bank: 0.2062 (no fee)
• CTBC Bank: 0.2065 (no fee)
• E.SUN Bank: 0.2067 (NT$100 per transaction)
• Hua Nan Bank: 0.2061 (no fee)
• Taipei Fubon Bank: 0.2069 (NT$100 per transaction)

Method 2: Online FX Conversion + Foreign Currency ATM Withdrawal — Flexible and low-cost

Using bank app or online banking, convert TWD to JPY and deposit into a foreign currency account, then withdraw cash at bank foreign currency ATMs using “spot sell rate” (about 1% discount). The entire process is open 24 hours, costing NT$800-1,200.

E.SUN Bank’s foreign currency ATMs allow direct withdrawal of yen from TWD accounts, with a daily limit of NT$150,000, no FX conversion fee, and only NT$5 cross-bank withdrawal fee. Denominations are fixed at 1,000/5,000/10,000 yen, offering flexibility.

This method suits those monitoring exchange rates, entering in batches when the rate is low (e.g., TWD/JPY below 4.80), lowering average costs. Especially for experienced forex investors, it’s suitable to transfer yen into fixed deposits (annual interest 1.5-1.8%) or yen ETFs.

Advantages: 24/7 operation, allows dollar-cost averaging, better rates than banks.
Disadvantages: Limited locations (~200 nationwide), high peak-time cash shortages, need to pre-open foreign currency accounts.
Suitable for: Investors who watch the market regularly and frequently deal with foreign currencies.

Bank foreign currency ATM daily withdrawal limits (2025 new regulation):

• CTBC Bank: equivalent to NT$120,000
• Taishin Bank: NT$150,000 equivalent
• E.SUN Bank: NT$150,000 equivalent (including debit card)

Method 3: Online FX Settlement + Branch Pickup — The best pre-departure reservation method

No need for a foreign currency account, just fill in currency, amount, pickup branch, and date on the bank’s website. After remittance, bring ID and transaction notice to the designated branch to pick up cash. Taiwan Bank’s “Easy Purchase” online FX settlement is fee-free (pay NT$10 via Taiwan Pay), with about 0.5% exchange rate advantage, costing NT$300-800.

Its biggest advantage is reservation for airport branch pickup. Taoyuan Airport has 14 Taiwan Bank branches, 2 of which operate 24 hours, allowing last-minute pickup before departure. Mega Bank also offers this service.

Ideal for planned travelers, but requires 1-3 days advance booking, with pickup during bank hours, and branch changes are not allowed.

Advantages: Better exchange rates, often fee-free or low-cost, airport pickup avoids hassle.
Disadvantages: Needs advance reservation, less flexible, cannot change branch at short notice.
Suitable for: Travelers with confirmed plans who want seamless airport pickup.

Method 4: Bank Counter Online FX — A compromise

Some banks offer hybrid service: online FX exchange followed by in-branch cash pickup, combining 24-hour convenience with in-person confirmation. Costs are between methods two and three.

Cost calculation for exchanging NT$50,000 to JPY

To clarify, here’s a breakdown of actual costs for NT$50,000 exchanged to yen via each method:

Data based on the rate on 2025/12/10, including fees, spreads, withdrawal costs.

How should beginners choose?

If it’s your first time exchanging yen, we recommend:

Step 1: Assess your amount and timing. If your trip is confirmed more than 2 weeks ahead, choose “Online FX + Airport Pickup” for lowest cost. For last-minute needs, use “Foreign Currency ATM” to solve urgent cash needs.

Step 2: Prefer batch exchanges over one-time. Enter in 3-4 installments based on market fluctuations to lower average costs. Currently, JPY is fluctuating between 150-155 in the short term.

Step 3: After exchange, don’t let the money sit idle. Transfer yen into fixed deposits (interest 1.5-1.8%), yen ETFs (e.g., Yuanta 00675U, 00703L), or small forex trades (USD/JPY) to increase returns.

Quick FAQs

Q: How much is the difference between cash rate and spot rate?
A: About 1-2%. Cash rate applies to physical cash transactions, with higher costs but immediate delivery. Spot rate is used for electronic transfers, settled T+2, closer to international market price. For example, spot 4.87 vs cash 4.85, about NT$40 difference per NT$10,000.

Q: How much yen can I get with NT$10,000?
A: At current cash sell rate 4.85, about 48,500 yen. Using spot rate 4.87, about 48,700 yen.

Q: What to bring for in-branch exchange?
A: Taiwanese nationals: ID + passport; foreigners: passport + residence permit. Pre-booking requires transaction notice. Under 20 need parental consent. Over NT$100,000 may require source of funds declaration.

Q: Why do some mention $300 USD equivalent?
A: Because USD/JPY also fluctuates. When yen appreciates, $300 USD can buy more yen. That’s why batching helps capture different exchange rates over time.

Next steps for yen investment

After exchanging for yen, how to grow it is key. We recommend four beginner-friendly allocation methods:

1. Yen Fixed Deposit: Most stable, deposit online into E.SUN/Taiwan Bank foreign currency accounts, starting from 10,000 yen, with 1.5-1.8% annual interest, suitable for 3-6 months term.

2. Yen Insurance Policy: Medium-term holding, Cathay/Fubon savings insurance, guaranteed interest 2-3%, combining protection and returns.

3. Yen ETFs: Growth-oriented, Yuanta 00675U tracks yen index, can buy fractional shares via broker, management fee 0.4%, suitable for dollar-cost averaging.

4. Forex Swing Trading: Advanced, trade USD/JPY or EUR/JPY directly, capturing short-term fluctuations, offering long/short and 24-hour trading, with risk assessment needed.

Summary

The yen has evolved from a purely travel currency to a core asset with hedging and investment value. Whether traveling or asset allocation, follow the principles of “batch exchange + don’t leave money idle” to minimize costs and maximize returns. Beginners should start with “online FX settlement + airport pickup” or “foreign currency ATM,” then transition into fixed deposits, ETFs, or swing trading based on needs. This way, you can enjoy more cost-effective trips and add a layer of protection during global market fluctuations. Now, it’s not about “whether to exchange,” but “how to exchange smartly.”