Yen Investment and Exchange Cost Analysis: Which of the Four Methods is the Most Cost-Effective?

As of December 10, 2025, the TWD to JPY exchange rate has reached 4.85, appreciating by 8.7% compared to 4.46 at the beginning of the year. Whether you’re planning to travel next year or want to allocate assets for hedging, the Japanese Yen deserves a fresh look. How you exchange this money and where you do it will determine how many JPY you ultimately receive.

Why focus on the Japanese Yen now?

The Yen is not just pocket money for travel; from a financial market perspective, it is one of the world’s three major safe-haven currencies (alongside the US dollar and Swiss franc). During last year’s Russia-Ukraine conflict, the Yen appreciated 8% in a week, effectively hedging against a 10% decline in the stock market. For Taiwanese investors, exchanging for Yen adds an extra layer of asset protection.

More importantly, the Bank of Japan (BOJ) is about to raise interest rates. Governor Ueda Kazuo recently made hawkish comments, pushing expectations of a rate hike to 80%, with a meeting on December 19 expected to raise rates by 0.25 basis points to 0.75% (a 30-year high). Japanese government bond yields have hit a 17-year high of 1.93%. This indicates the Yen may experience short-term volatility but could appreciate in the medium to long term, making it a good time for small-scale allocations.

In the second half of the year, Taiwan’s foreign exchange demand increased by 25%, mainly driven by travel recovery and hedging needs, showing market attention to the Yen.

The most cost-effective plan: Online currency exchange + Foreign currency ATM mix

First option: Online currency exchange for airport pickup

No need to open a foreign currency account. Simply fill in the currency, amount, pickup branch, and date on the bank’s official website. After completing the transfer online, bring your ID and transaction notification to pick up in person. Taiwan Bank and Mega International Bank offer this service, with appointment options at airport branches.

Taiwan Bank’s “Easy Purchase” online exchange has no handling fee (pay only NT$10 via Taiwan Pay), with about 0.5% better exchange rate, saving NT$300-800 on a NT$50,000 exchange compared to cash selling at counters. Taoyuan Airport has 14 Taiwan Bank outlets, including 2 open 24 hours, making pre-travel booking very convenient.

Advantages: Better exchange rates, often no handling fee, designated airport pickup
Disadvantages: Need to book in advance (1-3 days), pickup limited to bank hours

Second option: Real-time withdrawal at foreign currency ATMs

Use a chip-enabled bank card to withdraw cash in Yen at foreign currency ATMs, available 24/7 and supporting interbank transactions (NT$5 fee for withdrawals from a NT$ account). E.SUN Bank’s foreign currency ATMs allow withdrawals from NT$ accounts with a daily limit of NT$150,000 and no currency exchange fee.

Cost roughly NT$800-1,200 (based on NT$50,000), slightly higher than online exchange but more flexible. Note that cash at foreign currency ATMs is limited to fixed denominations (1,000/5,000/10,000 Yen). During peak times, cash may run out, so plan ahead.

Advantages: Instant withdrawal, 24/7 access, low interbank fees
Disadvantages: Limited locations (~200 nationwide), fixed denominations

For those with a foreign currency account: Online currency conversion

Use online banking or apps to convert NT$ to Yen and deposit into a foreign currency account, using the “spot selling rate” (about 1% better than cash selling). If cash is needed later, withdraw in person or at ATMs, but this incurs a spread and handling fee (starting around NT$100).

E.SUN Bank’s app allows currency conversion with a fee equal to the difference between spot and cash rates, minimum NT$100. Cost is about NT$500-1,000. Suitable for monitoring exchange rates and entering the market in batches when rates are low (e.g., when NT$ to Yen drops below 4.80).

Advantages: 24/7 operation, ability to buy in installments for average cost, better rates, can transfer into fixed deposits or ETFs
Disadvantages: Need to open a foreign currency account first, withdrawal in cash incurs additional fees

The most traditional but most costly: Cash exchange at counters

Carry NT$ cash to bank branches or airport counters to exchange for Yen cash, using the “cash selling rate” (about 1-2% worse than spot). As of December 10, 2025, Taiwan Bank’s rate is approximately NT$0.2060 per Yen (about 4.85 Yen per NT$).

Cost roughly NT$1,500-2,000 (based on NT$50,000), with some banks adding NT$100-200 fixed handling fee. Recommended only as a backup or for small, urgent exchanges.

Advantages: Safe, reliable, full denominations, staff assistance available
Disadvantages: Less favorable rates, limited operating hours, possible higher fees

Cost comparison of four exchange methods

After exchanging for Yen: Three ways to grow your investment

Once you have Yen, don’t let your money sit idle. Based on your risk appetite, consider:

Conservative: Yen fixed deposit
E.SUN, Taiwan Bank, and others offer foreign currency fixed deposits starting from 10,000 Yen, with annual interest rates of 1.5-1.8%. Suitable for capital preservation.

Mid-term: Yen insurance policies
Cathay, Fubon Life offer savings insurance with guaranteed interest rates of 2-3%, holding for 6-10 years, combining protection and returns.

Growth: Yen ETFs
Yuanta’s 00675U, 00703 tracking Yen indices can be bought as fractional shares via brokerage apps. Management fee around 0.4% annually, suitable for long-term asset allocation and capturing Yen appreciation.

When is the best time to exchange Yen? Staggered approach beats lump sum

Currently, the Yen exchange rate is quite volatile. USD/JPY has fallen from a high of 160 at the start of the year to around 154.58 now. Short-term fluctuations may bring it back to 155, but medium to long-term forecasts suggest below 150. As a safe-haven currency, the Yen’s short-term risk involves arbitrage unwinding, with 2-5% volatility.

Don’t exchange all at once; stagger your entries. Recommended plan:

• First batch: Book online exchange now to lock in airport pickup
• Second batch: Watch for NT$ to drop below 4.80, then use online exchange again
• Third batch: For urgent travel needs, use foreign currency ATM

This spreads risk and minimizes average cost.

Frequently Asked Questions

Q: How much is the difference between cash rate and spot rate?
Cash rate for physical bills is about 1-2% worse than the spot rate. Spot rate settles within two business days (T+2) and is used for electronic transfers, generally more favorable and aligned with international markets.

Q: How many Yen for NT$10,000?
Using Taiwan Bank’s rate of 4.85 on December 10, 2025, NT$10,000 exchanges for about 48,500 Yen (cash sale). Using the spot rate of 4.87, it’s about 48,700 Yen.

Q: What to bring for counter exchange?
ID + passport (for locals), or passport + residence permit (for foreigners). Under 20 needs parental accompaniment. Large exchanges over NT$100,000 may require source of funds declaration. For online booking, bring transaction notification.

Q: Are there limits for ATM withdrawals?
From October 2025, many banks have strengthened anti-fraud measures, reducing daily limits for third-party digital accounts to NT$100,000. CTBC, for example, allows NT$120,000 equivalent per day, Taishin NT$150,000, E.SUN’s own account NT$50,000, cross-bank NT$150,000. It’s advisable to split withdrawals or use your own bank card to avoid extra fees.

Final reminder

Choosing the right exchange method can save NT$1,000-1,700, equivalent to a month’s worth of bubble tea. But more importantly, treat Yen as part of your asset allocation, not just travel pocket money. Staggered exchange + transferring into fixed deposits or ETFs provides a buffer during market turbulence and potential gains from Yen appreciation.

Start now—use online exchange to make your Yen holdings smarter.