NTD depreciation: Everyone rushing to exchange for JPY? Four exchange channels tested with cost reveal

By the end of 2025, the Taiwan dollar (TWD) against the Japanese yen (JPY) broke through 4.85, and everyone around is discussing whether to exchange for yen. Some want to travel abroad, others want to invest at the low exchange rate, but few truly understand how to exchange most cost-effectively. We tested the four most mainstream yen exchange channels in Taiwan, using real market rates to show you, because choosing the wrong method could cost you thousands more.

Why is exchanging yen now so popular?

When it comes to foreign currency exchange, the yen is Taiwan people’s “first choice.” But the reasons go far beyond just traveling.

In daily life, Japanese yen are needed for shopping, purchasing via proxy, studying abroad, and working part-time. Cash remains the main method for shopping in Tokyo and Osaka (credit card penetration is only 60%), and for skiing in Hokkaido or vacationing in Okinawa, cash is almost always required. People who buy Japanese cosmetics, clothing, or anime merchandise often pay directly in yen to proxy services or online Japanese platforms.

From an investment perspective, it’s even more critical. The yen is one of the three major safe-haven currencies globally (alongside USD and Swiss Franc). Japan’s economy is stable, debt is manageable, and during market turmoil, funds tend to flow into the yen. During the Russia-Ukraine conflict in 2022, the yen appreciated 8% in a week, while global stock markets fell 10%—meaning the yen can hedge against Taiwan stock risk.

Additionally, Japan maintains ultra-low interest rates (0.5%) long-term, making the yen a “funding currency.” Many investors borrow yen at low interest, then invest in USD (with a USD/JPY interest rate differential of 4.0%), and when risks rise, they close the position and buy back yen, arbitraging the difference.

Is exchanging yen now worthwhile?

As of December 10, 2025, the TWD/JPY rate is about 4.85 (1 TWD = 4.85 JPY), up from 4.46 at the start of the year, an appreciation of 8.7%. From an investment standpoint, that’s quite good, especially under the continuous depreciation pressure on the TWD.

But profitability depends on: dividing the exchange into multiple batches, not exchanging all at once.

The yen is currently in a fluctuation zone. The US entering a rate cut cycle benefits the yen, but the Bank of Japan’s upcoming rate hikes introduce variables. Recently, the BOJ governor’s hawkish comments pushed expectations of hikes to 80%, with a rate increase to 0.75% at the December 19 meeting (a 30-year high). Japanese bond yields have hit a 17-year high. The USD/JPY has fallen from 160 at the start of the year to 154.58; short-term, it may hover around 155, but medium to long-term, it’s forecasted to be below 150.

For investors, the yen is suitable for hedging Taiwan stock volatility, but short-term risks include a 2-5% fluctuation when closing arbitrage positions. It’s recommended to buy in batches to reduce risk.

Real-world comparison of 4 yen exchange channels

Many think exchanging yen is just running to the bank, but the exchange rate difference alone can save or cost you the price of a bubble tea. Here are the four most mainstream methods:

Method 1: Bank counter cash exchange

Bring cash in TWD to a bank or airport counter to exchange for yen cash. This is the most traditional and widely used method, simple to operate but the most costly.

Banks use the “cash selling rate,” which is about 1-2% worse than the spot rate. For example, Taiwan Bank’s cash selling rate on December 10, 2025, is about 0.2060 TWD/JPY (1 TWD = 4.85 JPY). Exchanging 50,000 TWD results in a loss of 1,500-2,000 TWD. Some banks also charge a handling fee of 100-200 TWD per transaction.

Advantages: safe, denominations available (1,000/5,000/10,000 JPY), staff assistance.

Disadvantages: high cost, limited operating hours (weekday 9:00-15:30), additional fees.

Suitable for: Unfamiliar with online operations, urgent airport exchange, small amounts.

Estimated cost: 50,000 TWD → loss of 1,500-2,000 TWD.

Method 2: Online forex exchange to foreign currency account, then withdraw cash

Use bank app or online banking to convert TWD to JPY at the “spot selling rate” (about 1% better than cash rate), deposit into a foreign currency account. When cash is needed, withdraw via ATM or counter, incurring withdrawal fees (around 100 TWD).

The biggest advantage is observing the exchange rate, allowing you to buy in batches at low points (e.g., TWD/JPY below 4.80) to average the cost. 24/7 online operation, no banking hours restriction.

Disadvantage: need to open a foreign currency account first, and cross-bank withdrawal fees (5-100 TWD).

Advantages: better exchange rate, batch buying, 24/7 operation.

Suitable for: Forex investors, those with foreign currency accounts, considering small investments in yen deposits (current annual interest 1.5-1.8%).

Estimated cost: 50,000 TWD → loss of 500-1,000 TWD.

Method 3: Online pre-order currency exchange, pick-up at airport or branch

No need to open a foreign currency account first. Fill in currency, amount, pick-up branch, and date on the bank’s website. After remittance, bring ID + transaction notice to pick up in person. Taiwan Bank’s “Easy Purchase” and Mega Bank offer this.

This is the smartest pre-arranged method before traveling. Taiwan Bank charges only 10 TWD handling fee via TaiwanPay, with about 0.5% better rate. Taoyuan Airport has 14 Taiwan Bank outlets (2 open 24 hours), allowing direct pickup, saving the hassle of finding a bank after arriving abroad.

Advantages: favorable rates, often no handling fee, airport pickup option.

Disadvantages: need to book 1-3 days in advance, pickup during bank hours.

Suitable for: Planned travelers, those wanting cash directly at the airport.

Estimated cost: 50,000 TWD → loss of 300-800 TWD.

Method 4: 24-hour foreign currency ATM withdrawal

Use a chip-enabled financial card at a foreign currency ATM to withdraw yen cash directly. E.SUN Bank’s foreign currency ATMs support deduction from TWD accounts, with a daily limit of 150,000 TWD, no exchange fee. Cross-bank fee is only 5 TWD, making it the lowest-cost temporary withdrawal method.

Disadvantages: limited ATM locations (~200 nationwide), cash may run out during peak times. Denominations are fixed (1,000/5,000/10,000 JPY).

Advantages: instant withdrawal, 24/7 operation, deduction from TWD account saves fees.

Disadvantages: few locations, fixed denominations, possible cash shortages at peak times.

Suitable for: No time to visit banks, urgent need for yen cash.

Estimated cost: 50,000 TWD → loss of 800-1,200 TWD.

Core cost comparison table

After exchanging yen, don’t let your money just sit idle

Many people leave the yen idle after exchange, but you can make your money grow:

Yen fixed deposit: The most stable choice. Open an account at E.SUN or Taiwan Bank, with a minimum of 10,000 yen, annual interest rate 1.5-1.8%. 10,000 yen fixed deposit for one year yields about 280 yen interest.

Yen insurance policy: Medium-term holding. Cathay or Fubon Life offer savings insurance with guaranteed interest rates of 2-3%, but with policy term constraints.

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

Forex trading: Advanced option. USD/JPY or EUR/JPY can be traded 24/7 to catch rate fluctuations. Higher risk, requires trading experience.

While the yen is a safe haven, it also fluctuates bidirectionally. BOJ rate hikes are positive, but global arbitrage unwinding or geopolitical conflicts (Taiwan Strait, Middle East) may push the yen lower. For investment, yen ETFs can diversify risk; for trading, set stop-loss and take-profit levels.

Quick FAQ

Q: How much is the difference between cash rate and spot rate?

Cash rate is the bank’s quote for physical cash, allowing immediate cash receipt but 1-2% worse than spot. Spot rate is the forex market quote, used for electronic transfers and non-cash settlement, with T+2 settlement but better rates.

Q: How many yen for 10,000 TWD?

Using Taiwan Bank’s 2025/12/10 rate (cash selling 4.85), about 48,500 yen. Using spot rate (4.87), about 48,700 yen. The difference is about 200 yen (~40 TWD).

Q: What to bring for counter exchange?

Taiwanese: ID + passport; foreigners: passport + residence permit; companies: business registration. If pre-booked online, also bring transaction notice. Under 20 need parent’s consent. Large amounts (>100,000 TWD) may require source declaration.

Q: Are there withdrawal limits at foreign currency ATMs?

Post-October 2025, most banks set daily limits of 120,000-150,000 TWD for their cards; other banks vary. To avoid cross-bank fees, consider using your own bank’s card or splitting withdrawals.

Summary

The yen is no longer just for travel pocket money but an asset with hedging and investment value. Whether preparing for a trip to Japan or hedging against TWD depreciation by converting some funds into yen, mastering “batch exchange + investing after exchange” can minimize costs.

Beginners are advised to start with Taiwan Bank’s online pre-order airport pickup or foreign currency ATM, then move into deposits, ETFs, or swing trading based on needs. This way, you can enjoy your trip and also add a layer of protection during global market fluctuations. Remember, the key is not “when to exchange,” but “how to exchange.”