## How to Exchange Yen with Half the Cost

In December 2025, the TWD to JPY exchange rate surged to 4.85, up 8.7% from 4.46 at the beginning of the year. People traveling abroad, Japanese shopping agents, and investment hedgers are all rushing to buy yen. But did you know? For the same NT$50,000, choosing the wrong method could cost you an extra NT$1,500, while the right choice can save NT$800—the difference lies in your understanding of these four currency exchange methods.

### Why exchange yen now?

Don’t rush to the bank just yet. You need to understand why you are exchanging.

**Travel and Consumption**: Most stores in Japan (especially rural areas) only accept cash, and credit card penetration is only 60%. Buying cosmetics, eating ramen, taking taxis—without yen cash, it’s very troublesome. Shopping agents and long-term students also often need to plan ahead for yen to avoid losing out due to sudden exchange rate fluctuations.

**Investment Hedging**: This is even more interesting. The yen is one of the three major safe-haven currencies globally (alongside USD and Swiss Franc). Japan’s economy is stable, government debt is low, and when markets shake, funds tend to flow into the yen. During the Russia-Ukraine conflict in 2022, the yen appreciated 8% in a week, successfully buffering global stock declines. For Taiwanese investors, buying yen isn’t just for leisure; it’s also a tool to hedge against Taiwan stock market risks.

Not to mention, the Bank of Japan recently shifted to a hawkish stance. Governor Ueda hinted at raising interest rates to 0.75% by December 19 (a 30-year high), and Japanese government bond yields have broken a 17-year high of 1.93%. The USD/JPY interest rate differential has narrowed from a wide gap at the start of the year to about 4%, raising the risk of arbitrage unwinding, but in the medium to long term, the yen still has support.

### Four Ways to Exchange Currency, Huge Cost Differences

**Method 1: Cash Exchange at Counter**

The most traditional and safest way is to bring NT$ cash to a bank or airport to buy yen notes. However, this “cash selling rate” is 1-2% worse than the spot rate, which already costs you a meal. As of December 10, Taiwan Bank’s cash selling rate is about NT$0.2060 per yen (NT$1 = 4.85 yen), with some banks charging an additional NT$100-200 handling fee.

Exchanging NT$50,000 this way could cost you NT$1,500-2,000. Suitable only for urgent airport needs or those unfamiliar with apps.

**Method 2: Online Currency Exchange + Counter or ATM Withdrawal**

Use bank apps or online banking to convert NT$ to yen in a foreign currency account (using the spot rate, about 1% discount), then withdraw cash at counters or foreign currency ATMs. This process incurs an additional withdrawal fee (NT$100-NT$500), but overall costs are lower than in-branch exchange.

Ideal for those with forex investment experience planning to buy in batches for average cost. Cost for NT$50,000 is about NT$500-NT$1,000. The key is to buy in multiple batches when the exchange rate is low (TWD/JPY below 4.80) to maximize benefits.

**Method 3: Online Currency Settlement + Airport or Branch Pickup**

This is the most recommended balanced approach. No need to open a foreign currency account—just fill in the amount and pickup location on the bank’s website. After remittance, bring ID and transaction notice to pick up cash. Taiwan Bank’s “Easy Purchase” online settlement is fee-free (using Taiwan Pay costs only NT$10), with about 0.5% better exchange rate, and you can reserve airport pickup (Taoyuan Airport has 14 Taiwan Bank counters, 2 open 24 hours).

Cost for NT$50,000 is about NT$300-NT$800. Best suited for travelers with time to plan before departure who want to pick up cash at the airport. The downside is needing to book 1-3 days in advance, with pickup times limited by bank hours.

**Method 4: Foreign Currency ATM Instant Withdrawal**

Use a chip-enabled financial card at foreign currency ATMs for instant cash withdrawal, available 24/7. Cross-bank withdrawals cost only NT$5. The E.SUN Bank foreign currency ATM allows NT$150,000 per day with no currency exchange fee.

Exchanging NT$50,000 costs about NT$800-NT$1,200. But there are only about 200 ATMs nationwide, which can run out during peak times, and denominations are fixed (1,000/5,000/10,000 yen). Don’t wait until the last minute before departure.

### Should I Exchange Now or Wait?

Honestly, 4.85 is already a good level. At the start of the year, it was 4.46, meaning an 8.7% appreciation. Under the ongoing pressure of TWD depreciation, exchanging yen now yields a pretty good return.

But don’t convert all at once. The yen is currently fluctuating between 153-155, with short-term volatility of 2-5% normal. USD/JPY has fallen from a high of 160 at the start of the year to 154.58, and medium-term forecasts suggest it could go below 150—that is, the yen still has room to appreciate.

**Recommended Strategy**: Buy in batches, extend your timeline. For example, in May, split your purchases into 3-4 times, each time converting NT$12,000-15,000, reducing the risk of buying at a high point. Combine “online currency settlement + online exchange” for flexible rate control.

### After Buying Yen, Don’t Let Your Money Sit Idle

Getting yen is just the beginning; the key is how to make it grow.

**Yen Fixed Deposits** are the safest option: E.SUN and Taiwan Bank both offer foreign currency accounts, with online deposits starting from 10,000 yen, offering annual interest rates of 1.5-1.8%, risk-free.

Want higher returns? Consider **Yen ETFs** (like Yuanta 00675U, 00703), tracking the yen index. You can buy fractional shares via brokerage apps with an annual management fee of 0.4%. Or try **USD savings insurance**—many life insurers offer USD 6-year savings policies with guaranteed interest rates of 2-3%, creating a multi-currency portfolio to diversify exchange rate risk.

The bold can also trade **FX swing trading** on platforms like Mitrade, trading USD/JPY or EUR/JPY with zero commissions and low spreads. Suitable for capturing exchange rate movements, but high risk—strict money management is essential.

### Practical Comparison Table

| Exchange Method | Advantages | Disadvantages | Cost (NT$50,000) | When to Use |
|------------------|--------------|----------------|------------------|------------|
| Cash at Counter | Safe, immediate | Rate difference, limited hours | NT$1,500-NT$2,000 | Urgent airport needs |
| Online Exchange + Withdrawal | 24/7, batch buying | Need forex account, withdrawal fee | NT$500-NT$1,000 | For experienced investors |
| Online Settlement + Airport Pickup | Good rates, no fee | Need reservation, branch hours | NT$300-NT$800 | Pre-trip planning |
| Foreign Currency ATM | Instant, flexible | Limited locations, possible shortages | NT$800-NT$1,200 | Emergency needs |

### Common Pitfalls in Currency Exchange

**Cash Rate vs Spot Rate**: Cash rate is the buy/sell price for physical notes, 1-2% worse than the spot rate, plus handling fees. Spot rate is the market price for electronic transfers, more favorable but settled T+2. Use cash rate for cash transactions, spot rate for transfers.

**Large Amounts**: Over NT$100,000, banks may require source of funds declaration, with ID and passport (foreigners need passport + residence permit). Under 20 needs parental accompaniment.

**ATM Withdrawal Limits**: Banks’ policies vary in 2025. Most have daily limits of NT$100,000-NT$150,000 for their own cards; cross-bank limits depend on issuing bank. RMB withdrawals have special limits. Consider spreading withdrawals or using your own bank card to avoid cross-bank fees.

### Summary

Yen is no longer just “travel pocket money.” It’s a necessary travel expense, an investment hedging tool, and a hedge asset when TWD depreciates. By following the principles of “batch exchange + not sitting idle after exchange,” choosing the right methods to reduce costs, and combining deposits, ETFs, or USD savings insurance, you can add an extra layer of protection amid global market volatility and keep your travel fund fuller.

For beginners, start with “Taiwan Bank online settlement + airport pickup” or “foreign currency ATM,” then upgrade to more advanced yen swing trading once familiar.