Where is the most cost-effective place to exchange Japanese Yen? An article covering 4 major channels and the current exchange rate trend

December 2025, the TWD/JPY exchange rate has surpassed the 4.85 threshold, appreciating by a total of 8.7% since the beginning of the year. As the Bank of Japan (BOJ) signals a hawkish stance and global risk aversion increases, many Taiwanese are starting to seriously consider: Is now a good time to exchange for yen? How can they find the lowest-cost method among various channels?

This article provides a comprehensive guide to JPY exchange, including 4 exchange channels, real-time rate comparisons, risk tips, and asset allocation suggestions after exchange. Whether you’re traveling abroad or making small investments, you can quickly find the most suitable option.

Why is it worth paying attention to exchanging yen now?

The yen is not just pocket money for travel abroad; it is also one of the world’s three major safe-haven currencies (alongside USD and Swiss Franc). For Taiwanese investors, holding yen has two main attractions:

Hedging role: When global markets are turbulent, funds flow into yen. For example, during the Russia-Ukraine conflict in 2022, the yen appreciated by 8% within a week, buffering stock market declines. In the face of TWD depreciation pressure, moderate yen holdings can effectively diversify risk.

Arbitrage opportunity: Japan maintains ultra-low interest rates (only 0.5%), allowing investors to borrow yen at low interest and invest in higher-yield USD, enjoying a 4.0% interest rate differential. When market risks rise, closing positions may cause short-term volatility.

According to the latest market observations, Taiwan’s forex demand increased by 25% in the second half of the year, mainly driven by travel recovery and institutional hedging. With BOJ rate hike expectations heating up, short-term JPY may fluctuate 2-5%, but medium to long-term forecasts suggest support below 150.

Comparison of 4 major JPY exchange channels

Many think exchanging yen only requires going to a bank once, but even the rate difference alone could cost you several cups of bubble tea. We analyze the latest four methods one by one:

1. In-person exchange: Traditional but highest cost

Bring cash TWD directly to a bank branch or airport counter to exchange for cash JPY on the spot. This is the most straightforward method but also the most costly.

Exchange rate issue: Banks use “cash selling rate,” which is about 1-2% worse than the spot rate. For example, Taiwan Bank’s rate on December 10, 2025, was about 0.2060 TWD per JPY (roughly 4.85 JPY per TWD), already below market rate.

Fee differences: Policies vary. Taiwan Bank, Mega International, CTBC, First Bank, and Hua Nan waive fees; but E.SUN, E.SUN Bank, Cathay United Bank charge 100-200 TWD per transaction, increasing costs further.

For 50,000 TWD, in-person exchange loss is about 1,500-2,000 TWD.

Suitable for: elderly users, those unfamiliar with online operations, or urgent small cash needs at the airport.

2. Online exchange + in-person or ATM withdrawal

Use bank app or website to convert TWD to JPY and deposit into a foreign currency account, using “spot selling rate” (about 1% discount). When cash is needed, withdraw in person or via foreign currency ATM, but withdrawal fees apply.

Cost structure: Spot rate around 4.87, better than cash exchange. But withdrawal incurs exchange spread fees (from about 100 TWD) plus interbank transfer fees (5-100 TWD), totaling about 500-1,000 TWD.

Flexibility advantage: 24-hour operation support, ability to average costs over multiple entries, observe low-rate points (e.g., TWD/JPY below 4.80) before entering.

Post-exchange use: The obtained yen can be directly invested in yen fixed deposits (annual interest 1.5-1.8%) for interest income.

Suitable for: investors with forex experience, long-term yen holdings.

3. Online currency exchange + airport pickup

No need to open a foreign currency account. Fill in currency, amount, pickup branch, and date on bank’s website, complete remittance, then bring ID and transaction notice to pick up in person. Taiwan Bank’s “Easy Purchase” and Mega Bank offer this service, with appointment options at Taoyuan Airport branches.

Cost advantage: Taiwan Bank’s online exchange has no fee (pay only 10 TWD via TaiwanPay), with about 0.5% rate advantage. For 50,000 TWD, loss is about 300-800 TWD, the lowest-cost option.

Convenience: Taoyuan Airport has 14 Taiwan Bank outlets, 2 of which operate 24 hours. You can pick up before departure without staying in Taiwan.

Limitations: Requires prior appointment (at least 1-3 days), pickup during bank hours, no branch modifications.

Suitable for: travelers with planned schedules, pre-arranged trips.

4. Foreign currency ATM: Most convenient real-time solution

Use chip-enabled financial cards at foreign currency ATMs to withdraw cash JPY directly, supporting 24-hour operation. Deducts only 5 TWD cross-bank fee from TWD account, no additional exchange fee.

Operation features: E.SUN Bank foreign currency ATMs withdraw JPY from TWD accounts, with a daily limit of 150,000 TWD. CTBC, Taishin Bank, etc., have slightly different limits (5-15万 TWD/day).

Practical issues: Limited locations (~200 nationwide), currency and denomination restrictions (fixed 1,000/5,000/10,000 JPY), cash may run out during peak times. For 50,000 TWD, loss is about 800-1,200 TWD.

Suitable for: users who lack time for in-person exchange, need immediate withdrawal, or are near ATMs.

Visual comparison of the 4 exchange options

Beginner tips: For budgets between 50k-200k TWD, the most cost-effective combo is “online exchange + airport pickup” or “foreign currency ATM,” keeping costs minimal.

Current exchange rate trend: Is it really worth exchanging now?

Annual review: TWD/JPY was 4.46 at the start of 2025, now risen to 4.85, appreciating by 8.7%. For Taiwanese holding yen, this is a significant forex gain.

Recent developments: BOJ Governor Ueda Kazuo’s hawkish comments pushed rate hike expectations to 80%, with a 0.25 bps increase to 0.75% expected at the December 19 meeting (30-year high). Japanese bond yields hit a 17-year high of 1.93%.

Exchange rate outlook: USD/JPY dropped from a high of 160 at the start of the year to around 154.58 now. In the short term, global risk events may push it back to 155; but in the medium to long term, supported by BOJ rate hikes, it is forecasted to stay below 150.

Investment advice:

• Travel use: Exchanging now is suitable, but avoid all-in; staggered entry reduces risk.
• Investment purpose: Short-term JPY fluctuations of 2-5% are normal; suitable for phased allocation. Beware of arbitrage closing risks.
• Risk warning: Geopolitical conflicts (Taiwan Strait/Middle East) or global shocks could weaken yen; diversify timing of exchange.

Asset allocation directions after exchanging yen

Holding yen without interest yields idle funds; consider shifting to stable income or growth investments. Here are 4 common options suitable for small-scale beginners:

Yen fixed deposit (conservative): Open foreign currency accounts at E.SUN, Taiwan Bank, etc., deposit online. Minimum 10,000 yen, annual interest 1.5-1.8%, suitable for capital preservation.

Yen insurance policies (medium-term hold): Cathay, Fubon Life offer yen savings insurance, with guaranteed 2-3% interest, combining protection and returns.

Yen ETFs (growth): Yuanta 00675U, 00703 tracking yen indices, can buy fractional shares via broker apps, suitable for dollar-cost averaging; management fee 0.4%, risk and return balanced.

Yen forex trading (swing trading): Trade USD/JPY, EUR/JPY directly on forex platforms to capture short-term fluctuations. Advantages include two-way trading, 24-hour market, low entry barrier, suitable for experienced swing traders.

Common questions answered

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

Cash rate is the rate banks offer for physical cash buy/sell, convenient for immediate cash delivery but usually 1-2% worse than spot rate. Spot rate is the forex market’s T+2 settlement rate, used for electronic transfers and non-cash settlement, more favorable but requires waiting.

Q: How much yen can I get with 10,000 TWD?

Using Taiwan Bank’s December 10, 2025, cash selling rate of 4.85, 10,000 TWD yields about 48,500 JPY. With the spot rate of 4.87, about 48,700 JPY, difference roughly 200 JPY (about TWD 40).

Q: What documents are needed for in-person exchange?

Taiwanese: ID card + passport; foreigners: passport + residence permit. For online pre-arranged exchange, also bring transaction notice. Under 20 need parent’s consent; large amounts (>100,000 TWD) may require source declaration.

Q: Are there limits for foreign currency ATM withdrawals?

Different banks have different limits. CTBC: equivalent to 120,000 TWD/day; Taishin: 150,000 TWD/day; E.SUN: 50,000 TWD per transaction (total 150,000 TWD/day including card fees). It’s recommended to split withdrawals or use your own bank card to avoid cross-bank fees.

Optimal strategy for exchanging yen

Overall, choosing the most cost-effective yen exchange method depends on three factors: cost of exchange, timing planning, and post-exchange purpose.

For beginners, starting with “Taiwan Bank online exchange + airport pickup” or “foreign currency ATM” is recommended—low cost, simple operation. Investors with experience can choose “online exchange + fixed deposit/ETF investment,” enjoying favorable rates while earning interest or capital gains.

The key principle is staggered exchange and active holding. By spreading entries over time and investing yen into fixed deposits or ETFs, you can reduce exchange rate risk and generate returns. This way, you not only make travel more economical but also add a layer of asset protection during market turbulence.