Japanese Yen Exchange Guide: Four Major Strategies Amidst TWD Depreciation in 2025

Current Market Situation: Opportunities in Yen Exchange

As of December 10, 2025, the TWD/JPY quote is approximately 4.85, up about 8.7% from 4.46 at the beginning of the year. This is no coincidence—along with the Bank of Japan’s rising interest rate expectations (Governor Ueda Kazuo’s hawkish remarks have pushed market expectations of rate hikes to 80%), and the TWD facing depreciation pressures, more and more investors are seriously considering allocating yen. Data shows that Taiwan’s foreign exchange demand increased by 25% in the second half of the year, driven by travel recovery and hedging needs.

But the question “Is now a good time to exchange?” doesn’t have a simple yes or no answer. The key lies in choosing the right channels and methods. The same 50,000 TWD, if exchanged via the wrong method, could result in a loss of 500-2000 NT dollars—equivalent to giving away a few cups of bubble tea for free.

Yen is Not Just a Travel Currency, But Also a Hedging Asset

Many people’s understanding of yen stops at “exchanging a little for travel,” but from a market perspective, the yen has long been upgraded to one of the world’s three major safe-haven currencies (alongside the US dollar and Swiss franc).

Personal Use: Japan remains the favorite travel destination for Taiwanese. Shopping districts in Tokyo and Osaka, ski resorts in Hokkaido, beaches in Okinawa—although credit card penetration is about 60%, cash remains the mainstream payment method. Plus, the demand for purchasing Japanese goods online, studying or working in Japan, makes the daily application value of yen self-evident.

Investment Perspective: Yen’s attractiveness runs deeper. Japan’s economy is stable, government debt structure is sound, and during market turbulence, funds flow into yen as a safe haven—during the Russia-Ukraine conflict in 2022, the yen appreciated 8% in a week, effectively buffering the 10% decline in global stock markets. For Taiwanese investors, exchanging yen isn’t just for leisure; it can also hedge against Taiwan stock market volatility.

Additionally, Japan’s long-term ultra-low interest rate policy (only 0.5%) makes yen a “funding currency.” Many hedge funds borrow low-interest yen, convert to high-yield USD investments (the US-Japan interest rate differential reaches 4.0%), and when market risks rise, close positions to buy back yen. The existence of this arbitrage makes the yen exchange rate exhibit two-way volatility.

Deep Comparison of Four Major Currency Exchange Channels

Many people habitually go to bank counters without realizing they might be choosing the most expensive method. We tested four mainstream currency exchange channels in the market, comparing costs with real data.

Channel 1: Bank Counter Cash Exchange—Most Convenient, Most Expensive

Walk into a bank branch or airport counter, show ID and cash in TWD, and you can get JPY cash within ten minutes. This is the most straightforward method but also the most costly.

Banks use “cash selling exchange rate,” which is usually 1-2% worse than the spot rate. For example, Taiwan Bank’s rate on December 10, 2025, is about 0.2060 TWD per JPY (1 TWD = 4.85 JPY), while the spot rate is more favorable. Some banks also charge additional handling fees—E.SUN Bank, Mega International, Cathay United Bank each charge 100-200 NT dollars.

For 50,000 TWD, using counter exchange might result in a loss of 1500-2000 NT dollars.

Who should choose this? Those unfamiliar with online operations, needing small amounts for temporary use (like urgent airport cash), or first-time exchangers.

Bank counter exchange rates and fees (2025/12/10):

Channel 2: Online Exchange + Counter Pickup—A Balance of Flexibility and Cost

Many banks offer online banking or app-based currency exchange. The process: convert TWD to JPY online and deposit into a foreign currency account (using “spot sell rate”), then pick up cash at the counter or withdraw via foreign currency ATM as needed.

Advantages include batch operations and observing exchange rate trends. When TWD/JPY drops below 4.80, entering the market can lower average costs. However, cash withdrawal incurs exchange spread fees, starting around 100 NT.

Who should choose this? Those with some forex investment experience, frequently using foreign currency accounts, or planning to hold JPY deposits (annual interest rate 1.5-1.8%).

Estimated cost: Exchanging 50,000 TWD may result in a loss of 500-1000 NT.

Channel 3: Online Currency Conversion + Airport Pickup—The Premium Pre-Travel Solution

This channel has gained popularity among office workers recently. The process is simple: log into the bank’s website, fill in currency, amount, pickup branch, and date; after online transfer, bring ID and transaction notice to the designated branch to pick up cash.

Taiwan Bank’s “Easy Purchase” online currency exchange is completely fee-free (pay 10 NT via TaiwanPay), with about 0.5% better rates. The best part is Taoyuan Airport has 14 Taiwan Bank branches, including 2 open 24 hours. Before departure, you can pick up cash directly at the airport, saving the trouble of going back and forth to the bank.

Advantages: Best exchange rates, no service fees year-round, reservation for airport pickup, flexible timing.

Disadvantages: Need to book at least 1-3 days in advance; pickup times are limited by bank hours; branches cannot modify appointments.

Who should choose this? Travelers with a planned schedule, preparing in advance for their trip. This is our top recommendation.

Estimated cost: Exchanging 50,000 TWD may result in a loss of 300-800 NT.

Channel 4: Foreign Currency ATM Withdrawal—24/7 Instant Cash

Some banks have set up foreign currency ATMs nationwide. Customers with chip-enabled debit cards can withdraw JPY cash directly. Mega Bank’s foreign currency ATMs allow withdrawal of JPY from TWD accounts, with a single-day limit of 150,000 NT, no exchange fee, and only 5 NT cross-bank withdrawal fee.

The biggest advantage is timing flexibility—24/7 access. The downside is limited locations (about 200 nationwide), fixed denominations (only 1000/5000/10000 JPY), and cash shortages during peak times (like at airports).

Who should choose this? Those without time to visit banks or needing emergency cash late at night.

Estimated cost: Exchanging 50,000 TWD may result in a loss of 800-1200 NT.

Comprehensive Comparison Table of the Four Methods

Clarification of Common Questions

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

Cash rate (Cash Rate) is the buy/sell rate banks offer for physical bills or coins, for immediate cash exchange, convenient but costly. Spot rate (Spot Rate) is the foreign exchange market rate for settlement within two business days (T+2), mainly used for electronic transfers, corporate settlements, or foreign currency accounts, closer to international market prices but requires waiting.

In simple terms: Cash rate = immediate and expensive; Spot rate = wait 2 days and cheaper.

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

Based on Taiwan Bank’s rate on December 10, 2025, the cash selling rate is about 4.85, so 10,000 TWD can get approximately 48,500 JPY. Using the spot selling rate (about 4.87), it’s roughly 48,700 JPY—about 200 JPY difference (roughly 40 NT). The difference is small but can be magnified with larger amounts.

Q: What documents do I need to bring before exchanging?

Counter exchange: Taiwanese nationals need ID + passport; foreigners need passport + residence permit. For corporate exchanges, business registration proof is required. If pre-booked online, bring transaction notice. Under 20 need parental consent; large amounts (over 100,000 NT) may require source of funds declaration.

Q: Are there limits on foreign currency ATM withdrawals?

Yes. After the new regulations in October 2025, banks adjusted withdrawal limits. CTBC: single and daily limit of 120,000 NT; Taishin: 150,000 NT per transaction and per day; E.SUN: 50,000 JPY per transaction, 150,000 JPY daily. It’s recommended to split withdrawals or use your own bank card to avoid cross-bank fees (5 NT per transaction).

Asset Allocation After Exchanging Yen

Once you have cash in JPY, don’t let it sit idle in your wallet losing value. Based on your risk tolerance and time horizon, here are four allocation options:

Capital Preservation: Yen Fixed Deposit — The safest choice

E.SUN Bank, Taiwan Bank, etc., offer yen fixed deposits, starting from 10,000 yen, with annual interest rates of 1.5-1.8%. Suitable for short-term travel funds or conservative investors, providing stable but limited returns.

Mid-term: Yen Insurance Policy — Protection + Interest

Cathay Life, Fubon Life offer yen-denominated savings insurance, with guaranteed interest rates of 2-3%, suitable for 3-5 year holding plans. Benefits include protection features; drawbacks are limited liquidity.

Growth: Yen ETFs — Participate in market fluctuations

Yuan Da 00675U tracks the yen index, with a management fee of only 0.4% annually, available for fractional purchase via brokerage apps, ideal for dollar-cost averaging. Compared to holding cash, ETFs diversify risk and participate in yen appreciation.

Swing Trading: Forex Trading — High risk, high reward

Trade USD/JPY or EUR/JPY directly on forex platforms. Advantages include two-way operation, 24-hour trading, and small capital requirements; disadvantages are high volatility and the need for technical analysis skills.

Final Recommendations

Yen in 2025 is no longer just “travel pocket money,” but an asset with hedging and investment value. With the TWD facing depreciation pressures and the Bank of Japan’s rate hike prospects, allocating some yen is a reasonable hedging strategy.

Our core advice: Exchange gradually, don’t leave it idle.

Beginners can start with the simplest “Taiwan Bank online currency exchange + airport pickup” or “foreign currency ATM,” exchanging 30,000-50,000 TWD at a time, observing rates, then gradually entering the market. After exchanging, consider moving into fixed deposits, ETFs, or forex trading based on your situation, letting idle yen generate returns.

This way, you not only enjoy more cost-effective travel but also add a layer of protection amid global market turbulence.