Is exchanging TWD for JPY really cost-effective? A comparison of 5 withdrawal options

December 2025 has arrived, and the USD/TWD exchange rate has surpassed 4.85, reigniting travel to Japan and asset allocation in yen. However, many still don’t realize that choosing the wrong currency exchange channel can cost you NT$1,500-2,000 in just exchange rate differences. We break down the five most practical withdrawal options on the market to help you understand them all at once.

Why is it worth exchanging for Japanese Yen? Not just for travel

Many think that yen is just pocket money for traveling abroad, but there’s more to it.

Travel and daily expenses: Japan’s credit card penetration is only 60%, and most stores still require cash. Pharmacies, clothing, anime merchandise purchases all need yen payments; students studying or working part-time in Japan also need to plan foreign exchange in advance.

Financial hedging perspective: The yen ranks as one of the three major safe-haven currencies globally (alongside USD and Swiss Franc). During the Russia-Ukraine conflict in 2022, the yen appreciated 8% in a week, while the stock market fell 10%—a perfect hedge value for the yen. The Bank of Japan maintains ultra-low interest rates (currently 0.5%), making the yen a popular “financing currency,” with investors often borrowing low-interest yen to arbitrage into higher-yield USD (USD/JPY interest rate differential about 4.0%).

As of December 10, 2025, the TWD/JPY rate is about 4.85, up 8.7% from the start of the year, representing a substantial exchange gain for Taiwanese investors.

To exchange now or wait? Market analysis

The yen is currently in a volatile range. With the US entering a rate-cut cycle, the yen faces support, but the Bank of Japan is on the verge of raising rates—Governor Ueda signals a hawkish stance, and the market expects a rate hike to 0.75% at the December 19 meeting (a 30-year high), with Japanese bond yields reaching a 17-year high of 1.93%. USD/JPY has fallen from 160 at the start of the year to 154.58, with short-term support around 155, and medium to long-term forecasts below 150.

Conclusion: Exchanging yen now is advantageous, but do so in batches. Avoid converting all at once to reduce short-term volatility risk (typically 2-5%).

Complete comparison of 5 yen withdrawal options

Option 1: Bank counter cash exchange — the most traditional but most costly

Bring TWD cash to a bank or airport counter to exchange for yen cash, using the “cash selling rate” (1-2% worse than spot rate). For example, Taiwan Bank’s rate on December 10, 2025, is about NT$0.2060 per yen (1 TWD = 4.85 yen).

Bank cash selling rates and fees (2025/12/10):

Pros: Safe, full denominations (1,000/5,000/10,000 yen), staff assistance available.
Cons: Worst exchange rate, limited to business hours (9:00-15:30), fees may add up.
Cost estimate: NT$50,000 exchange costs about NT$1,500-2,000 in losses.
Suitable for: Travelers unfamiliar with online operations or urgent airport needs.

Option 2: Online currency exchange into foreign currency account — flexible but requires know-how

Use bank app or online banking to convert TWD into yen, depositing into a foreign currency account (spot sell rate, about 1% better than cash selling). To withdraw cash, additional withdrawal fees apply (around NT$100+).

E.SUN Bank example: online spot sell rate around 4.87, with withdrawal fees at counters or foreign ATMs. Suitable for investors monitoring rates and doing batch entries.

Pros: 24/7 operation, allows averaging costs over time, better exchange rate by 1%.
Cons: Need to open a foreign currency account first, withdrawal fees (NT$5-100), cross-bank charges.
Cost estimate: NT$50,000 exchange costs NT$500-1,000 in losses.
Suitable for: Those experienced with forex, interested in yen deposits (annual interest 1.5-1.8%).

Option 3: Pre-arranged currency exchange for airport pickup — best before travel

No need for a foreign currency account. Fill in currency, amount, pickup branch, and date on the bank’s website. After confirmation, bring ID and transaction notice to pick up in person. Taiwan Bank’s “Easy Purchase” online exchange is fee-free (NT$10 via TaiwanPay), with a 0.5% rate advantage.

Taoyuan Airport has 14 Taiwan Bank outlets (2 open 24 hours), ideal for pre-travel arrangements.

Pros: Better rates, often no fees, can specify airport pickup, reduces queues.
Cons: Need to book 1-3 days in advance, pickup limited to bank hours, branch cannot be changed.
Cost estimate: NT$50,000 exchange costs NT$300-800 in losses.
Suitable for: Organized travelers planning to withdraw at the airport.

Option 4: ATM withdrawal of yen — most convenient 24/7, but with tips

Use chip-enabled debit/credit cards at foreign currency ATMs to withdraw yen cash. Advantages: 24-hour access, low cross-bank fee (NT$5). For example, E.SUN’s foreign currency ATMs allow yen withdrawal without exchange fee from NT$ accounts, with a daily limit of about NT$150,000 equivalent.

Limited number of ATMs (~200 nationwide), restricted denominations (fixed 1,000/5,000/10,000 yen), cash may run out during peak times. By late 2025, Japan ATM withdrawal services will require international cards (Mastercard/Cirrus).

Latest ATM withdrawal limits (2025):

Pros: Instant cash, flexible, low cross-bank fee, no queue.
Cons: Limited locations, fixed denominations, cash shortages at peak times, plan ahead.
Cost estimate: NT$50,000 exchange costs NT$800-1,200 in losses.
Suitable for: Urgent, temporary needs, accustomed to ATM operations.

Option 5: Hybrid strategy — the smart choice

For budgets NT$50,000-200,000, we recommend a “online exchange + ATM withdrawal” combo. Lock in large airport withdrawals (e.g., NT$100,000) via online exchange, then top up with ATM withdrawals as needed. This maximizes favorable rates and flexibility.

Summary of 5 options’ costs

What to do after getting yen? Don’t let your money sit idle

After exchanging yen, it’s a waste to leave it idle without earning interest. Here are four options suitable for small amounts and beginners:

1. Yen fixed deposit: Stable choice, starting from NT$10,000 yen, annual interest 1.5-1.8%. Use E.SUN or Taiwan Bank online, suitable for risk-averse investors.

2. Yen insurance policy: Cathay or Fubon life offer savings insurance with guaranteed interest rates of 2-3%, suitable for medium-term holding (3-5 years).

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

4. Forex swing trading: Trade USD/JPY or EUR/JPY directly via platforms like Mitrade. Pros: two-way trading, 24/7. Cons: higher risk (2-5% volatility), requires experience. Mitrade offers zero commission, low spreads, and advanced tools like stop-loss/take-profit.

BOJ rate hikes favor the yen, but global arbitrage unwinding or geopolitical conflicts (Taiwan Strait/Middle East) may suppress it. For investments, prefer yen ETFs for diversification.

Quick FAQs

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

Cash rate applies to physical cash transactions, delivered immediately at the bank, but is 1-2% worse than spot rate plus fees. Spot rate is used for electronic transfers, settled T+2, more favorable (close to international market), but no immediate cash.

Q: How much yen for NT$10,000?

Using Taiwan Bank’s December 10, 2025, cash selling rate of 4.85, NT$10,000 ≈ 48,500 yen. With spot rate (~4.87), about 48,700 yen—difference of ~200 yen (~NT$40).

Q: What to bring for counter exchange?

Taiwanese: ID + passport; foreigners: passport + residence permit. Online booking also requires transaction notice. Under 20 need parent’s consent. Large amounts (>NT$100,000) may require source declaration.

Q: Are there daily limits for foreign currency ATMs?

From October 2025, limits adjusted. CTBC/Taishin: about NT$120,000-150,000 per day; E.SUN: about NT$150,000. Limits depend on issuing bank. Consider spreading withdrawals or using your own bank card to avoid NT$5 per transaction fee.

Final advice

Yen is no longer just travel “pocket money,” but an asset with hedging and investment value. The prime time to exchange in 2025 is still here—key is choosing the right channels and timing.

Beginners should start with “Taiwan Bank online exchange + airport pickup” or “foreign currency ATM,” then move into deposits, ETFs, or forex trading as needed. Master the principles of “batch exchange + don’t leave your money idle,” to minimize costs and maximize returns—saving travel expenses and adding a layer of protection amid global market turbulence.