Is exchanging TWD to JPY really cost-effective? Understand the cost pitfalls of the 4 major exchange channels in one go

December 2025, the Taiwan dollar to Japanese yen has reached 4.85, in other words, 1 TWD can exchange for 4.85 JPY. Compared to 4.46 at the beginning of the year, the yen has appreciated over 8% in half a year. This is indeed a good timing for Taiwanese people planning to visit Japan or hedge their assets. But the question is—do you know how to exchange money most cost-effectively?

Is it worth exchanging yen now? The answer is: yes, but you need to choose the right method

Many people think that exchanging yen is just walking into a bank or airport, but in reality, just the difference in exchange rates can cost you the price of several cups of bubble tea. In the second half of this year, Taiwan’s foreign exchange demand increased by 25%, mainly driven by travel recovery and rising hedging needs.

From a market perspective, the yen, as one of the world’s three major safe-haven currencies (alongside the USD and Swiss Franc), is under upward pressure. The Bank of Japan Governor Ueda Kazuo recently signaled a hawkish stance, with market expectations of a rate hike to 0.75% on December 19 (a 30-year high), which will further support the yen. Meanwhile, the US has entered a rate-cut cycle, narrowing the US-Japan interest rate differential from 4.0%. In the short term, the yen may fluctuate between 154-155, but in the medium to long term, a break below 150 is possible.

For investors, staggered currency exchange is key—avoiding converting all at once can average costs and hedge against short-term volatility.

4 ways Taiwanese people exchange yen, with cost differences up to 3 times

First: Traditional cash exchange at counters (highest cost, loss of NT$1,500-2,000)

Carrying cash in TWD directly to a bank branch or airport to exchange for yen cash. This is the most straightforward method but also the most costly.

Banks will use the “cash selling rate,” which is usually 1-2% worse than the spot rate. For example, Taiwan Bank’s cash selling rate on December 10, 2025, was 0.2060 (meaning 1 yen = NT$0.2060, or 1 TWD = 4.85 yen). If you use the more favorable spot selling rate of 0.2061, just this difference can cost you NT$500 on NT$50,000.

Additionally, some banks charge fixed handling fees (E.SUN and E.SUN Bank each NT$100, Cathay United Bank NT$200). Overall, exchanging NT$50,000 at least costs NT$1,500 in losses.

When to use? Only for small urgent needs (like at the airport if cash runs out) or if you are completely unfamiliar with online operations. Otherwise, it’s not cost-effective.

Second: Online currency exchange + airport pickup (lowest cost, loss NT$300-800)

Using bank apps or websites, fill in the amount, date, and preferred pickup airport. The bank will handle the exchange, and you just need to bring your ID and transaction notification to pick up the cash.

Taiwan Bank’s “Easy Purchase” service is the smartest—pay with Taiwan Pay for NT$10 handling fee, with a 0.5% better exchange rate. Exchanging NT$50,000 costs only NT$300-500 in losses, making it the cheapest method. You can also book 3-5 days in advance. Taoyuan Airport has 14 Taiwan Bank branches (including 2 open 24 hours), so no need to worry about missing your flight.

The only downside is the need for prior planning; it’s not suitable for last-minute decisions.

When to use? Plan a week before departure, decide on the date and amount in advance—this is the smartest choice.

Third: Online currency exchange + ATM withdrawal (moderate cost, loss NT$800-1,200)

Open a foreign currency account, transfer TWD to JPY at spot rate via bank app (no cash involved), then withdraw cash at foreign currency ATMs when needed.

Advantages include 24-hour access, low cross-bank withdrawal fee (NT$5), and relatively high withdrawal limits (E.SUN NT$150,000/day, Taiwan Bank NT$150,000/day). Disadvantages are limited ATM locations (~200 nationwide), especially in remote areas, and fixed denominations (1,000/5,000/10,000 yen). During peak times (holidays, airports), cash may be insufficient.

Exchanging NT$50,000 costs about NT$800-1,200, making it a moderate option.

When to use? For urban dwellers, frequent foreign currency account users, or those who need cash on short notice without visiting a bank.

Fourth: Online currency exchange + over-the-counter cash withdrawal (most flexible, loss NT$500-1,000)

If you have a foreign currency account, you can exchange at spot rate anytime via app, then decide when to withdraw cash in person based on exchange rate trends. Ideal for dollar-cost averaging or gradual entry.

Example: If you observe the TWD/JPY rate drops below 4.80, you can exchange NT$15,000 three times into your account, then withdraw later when favorable. This avoids the risk of “immediate appreciation after exchange.”

The downside is additional withdrawal fees (NT$5-100 cross-bank), totaling NT$500-1,000 on NT$50,000. But if you plan to hold yen in fixed deposits or buy ETFs, you don’t need cash, reducing costs further.

When to use? For experienced forex investors seeking flexible operations.

4 investment methods to recover losses after exchanging yen

Once you’ve exchanged yen, don’t just leave it idle—that’s a missed opportunity. The current annual interest rate for yen deposits is around 1.5-1.8%, much higher than TWD:

1. Yen fixed deposit: Open a foreign currency account, deposit as low as 10,000 yen, with an annual interest rate of 1.5-1.8%, suitable for conservative investors.

2. Yen insurance policies: Cathay/ Fubon’s foreign currency savings insurance, with guaranteed interest rates of 2-3%, but require locking in for 1-5 years.

3. Yen ETFs: Buy funds like Yuanta 00675U or similar yen-tracking ETFs, with management fees as low as 0.4%, suitable for those wanting exposure to yen appreciation without direct trading.

4. Forex swing trading: Trade USD/JPY or EUR/JPY directly on forex platforms, profit from both long and short positions, 24/7 trading, but with higher risk.

Key numbers at a glance

To clarify, here’s a comparison of costs for exchanging NT$50,000 into yen:

Essential knowledge about currency exchange

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

Cash rate is the rate banks offer for physical banknotes, settled immediately, convenient but 1-2% worse than the spot rate. Spot rate is used for electronic transfers, settled T+2 (two business days), and is closest to the international market price, thus cheaper.

Q: How much yen can I get with NT$10,000?

Using the cash rate 4.85, NT$10,000 ≈ 48,500 yen. Using the spot rate 4.87, ≈ 48,700 yen—about 200 yen difference (roughly NT$40).

Interestingly, exchanging NT$10,000 for RMB at current rates yields about 1,400-1,450 RMB, meaning NT$500 ≈ NT$3,400-3,500. This shows yen is relatively expensive but has higher appreciation potential.

Q: What do I need to bring for counter exchange?

Taiwanese: ID card + passport; foreigners: passport + residence permit. If booked online in advance, bring transaction notification. Over NT$100,000 exchange may require source of funds declaration.

Q: What’s the daily withdrawal limit at foreign currency ATMs?

Varies by bank. CTBC: NT$120,000/day; Taishin: NT$150,000/day; E.SUN: NT$5,000 per transaction (up to NT$150,000/day). Cross-bank cards are often more restricted. From October 2025, many banks have strengthened anti-fraud measures, with third-party digital accounts limited to NT$100,000/day. Check your bank’s rules beforehand.

Final advice

Yen is no longer just for travel “pocket money”; it also has hedging and investment value. Whether you plan to visit Japan next year or want to hedge against TWD depreciation, the key is—staggered exchange + don’t just sit on your hands after exchanging.

For beginners, the simplest approach is “Taiwan Bank online exchange + airport pickup” or “foreign currency ATM.” After exchanging, move funds into fixed deposits or ETF investments based on your needs. This way, you can enjoy cost-effective travel and add a layer of protection during global market fluctuations.

Remember: planning ahead is always cheaper than last-minute rushes.