Is now the right time to exchange TWD for JPY? The truth about the cost of staggered entry versus all-at-once exchange

As of December 10, 2025, the exchange rate is approximately 4.85 JPY per 1 TWD, which has become the current benchmark for currency exchange. From an initial rate of 4.46 at the start of the year, it has risen by a total of 8.7%. Many are considering whether to enter the market. But when is the real bargain for exchanging yen? The key isn’t “when to exchange,” but “how to exchange.”

Why do you want to exchange yen? Clarify your needs first

Many people think of exchanging yen only for travel abroad. But in reality, the uses of yen are much broader than you imagine.

Travel and daily expenses: In Tokyo, Osaka, Hokkaido, many stores still prefer cash transactions (credit card penetration is only 60%), drugstores, convenience stores, and small restaurants almost all require cash. Purchasing agents and Japanese online shopping often require direct yen payments.

Asset allocation perspective: The yen is one of the world’s three major safe-haven currencies (alongside USD and Swiss Franc). When global markets are turbulent, funds flow into the yen. During the Russia-Ukraine war in 2022, the yen appreciated 8% in one week, while stocks fell 10%—this demonstrates the power of safe-haven assets. For Taiwanese investors, holding yen can hedge against declines in the Taiwan stock market.

Interest rate arbitrage: The Bank of Japan maintains ultra-low interest rates (around 0.5%), making the yen a “funding currency.” Smart investors borrow yen at low interest to buy higher-yield USD (the USD/JPY interest differential is about 4.0%), and when risks rise, they close positions for profit.

Understanding whether your purpose is travel, investment, or diversification allows you to choose the most precise exchange method.

Four major yen exchange routes in Taiwan, with costs and risks analyzed

Many think that just going to the bank counter is enough, but the exchange rate spread alone can cost you hundreds of TWD. Here, we compare four feasible methods.

Option 1: Bank counter or airport cash exchange — safest but most expensive

Enter a bank branch or airport counter, pay in cash TWD, and receive yen cash. The process is straightforward and transparent; bank staff will count on the spot—but this “peace of mind” comes at a price.

Banks use the “cash selling rate,” which is typically 1-2% worse than the spot market rate. For example, Taiwan Bank’s December 10 rate: cash selling rate is 0.2060 TWD per yen (equivalent to about 4.85 yen per TWD). Some banks also charge handling fees, e.g., E.SUN Bank NT$100 per transaction, Cathay United NT$200—these are hidden costs.

If you only need cash urgently (e.g., missing a flight at the airport) or are not comfortable with online transactions, cash exchange at the counter is a safe but costly choice. But if you know a week in advance, you shouldn’t do it this way.

Cost estimate: Exchanging NT$50,000 at the counter results in a loss of about NT$1,500–2,000.

Option 2: Online currency exchange into foreign currency account — for forex traders

Open your bank app, find the “Foreign Currency Settlement” feature, select yen, enter the amount, and your TWD account will be debited while your yen account is credited. This uses the “spot selling rate,” which is about 1% better than the cash selling rate.

But if you want cash later, you’ll need to pay another fee (interbank transfer NT$5–100). Overall, this method is better than cash exchange but not as good as the next two options.

The real advantage here is batch entry. If you watch exchange rate fluctuations and exchange small amounts weekly over 3-4 times, you can effectively lower your average cost. Especially suitable for those with foreign currency accounts or who want to invest in yen deposits (current annual interest rate 1.5–1.8%).

Cost estimate: Exchanging NT$50,000 in installments results in a loss of about NT$500–1,000.

Option 3: Online reservation for currency exchange, pick up cash at designated location — best pre-departure plan

This is a highly underestimated method. Taiwan Bank and Mega International Bank offer “online currency exchange” services: you reserve via their website, select amount and pickup date, specify a branch (including airports), and the next day you can go with ID to pick up.

Taiwan Bank’s “Easy Purchase” service is especially user-friendly—pay with Taiwan Pay for just NT$10, with a 0.5% favorable rate, and no handling fee. Taoyuan Airport has 14 Taiwan Bank outlets, two of which operate 24 hours. You can pick up your yen a couple of hours before your flight, avoiding the need to carry cash days in advance.

The only downside is you need to book 1-3 days ahead; once the branch confirms, you cannot change it.

Cost estimate: Exchanging NT$50,000 online results in a loss of about NT$300–800.

Option 4: Foreign currency ATM withdrawal — most flexible but limited

About 200 foreign currency ATMs across Taiwan allow 24-hour withdrawals with chip-enabled bank cards. You can withdraw yen cash directly from your TWD account, with a cross-bank fee of NT$5, which is cheaper than counter exchange. E.SUN Bank’s foreign currency ATMs have a daily limit of NT$150,000, with no exchange fee.

However, the drawbacks are clear: limited locations (not every county has one), fixed denominations (only 1,000/5,000/10,000 yen bills), and often cash runs out during peak times (especially near airports). Not recommended to wait until the day of departure to withdraw.

Cost estimate: Withdrawing NT$50,000 at an ATM results in a loss of about NT$800–1,200.

Comparison table of the four exchange options

Is now a good time to enter? Exchange rate trend and risk assessment

The 4.85 rate seems decent, but it’s important to understand the macro environment.

BOJ Governor Ueda Kazuo has recently signaled a hawkish stance, with market expectations of a 0.25 basis point rate hike at the December 19 meeting to 0.75% (a 30-year high). Japanese government bond yields have surged to 1.93%. The US is also entering a rate-cut cycle, which supports the yen. The USD/JPY has fallen from a high of 160 at the start of the year to around 154.58 now. Short-term, it may test 155, but medium to long-term forecasts suggest below 150.

To exchange or not? It’s advisable to enter gradually. While the yen has safe-haven attributes, it also fluctuates bidirectionally. Global arbitrage unwinding or geopolitical conflicts (Taiwan Strait, Middle East) could push the rate lower. Short-term volatility of 2-5% is common. Full conversion at once carries high risk; better to buy in 3-4 installments to lower the average cost.

In the second half of the year, Taiwan’s forex demand increased by 25%, mainly from travel recovery and investment hedging. If your plan is to use the money within six months (travel, study abroad), now is fine; for pure investment, consider batching and waiting for lows.

After acquiring yen, how to make it grow instead of just holding

Once you have yen, don’t let it sit idle. Based on your purpose, here are four wealth management paths.

Deposit route: E.SUN and Taiwan Bank offer foreign currency accounts, deposit yen online, with annual interest rates of 1.5–1.8%, starting from 10,000 yen. This is the lowest-risk option, suitable for conservative investors.

Insurance route: Cathay and Fubon Life offer yen savings insurance, holding for 3–5 years, with guaranteed interest rates of 2–3%, plus coverage.

Index investment route: Yuanta ETFs 00675U, 00703 tracking yen exchange rate trends. You can buy fractional shares via brokerage apps, suitable for dollar-cost averaging. Management fee is 0.4% annually, with good diversification.

Swing trading route: Trade USD/JPY or EUR/JPY directly on forex platforms like Mitrade, which offer zero commissions, low spreads, stop-loss/take-profit tools, and 24-hour two-way trading. Suitable for short-term traders with experience, but highest risk.

Quick FAQ

Q. How many yen can 1 TWD buy now?
Taiwan Bank’s December 10 cash selling rate: 0.2060 TWD per yen, so 1 TWD ≈ 4.85 yen. NT$10,000 ≈ 48,500 yen (counter), or about 48,700 yen at the spot rate (~4.87).

Q. What’s the difference between cash rate and spot rate?
Cash rate is the rate banks offer for physical cash transactions, with a 1-2% spread. Spot rate is the foreign exchange market rate for T+2 settlement, used for electronic transfers, closer to international market.

Q. What to bring for counter exchange?
Taiwanese: ID card + passport; foreigners: passport + residence permit. If online reservation was made, bring transaction confirmation. Large amounts (over NT$100,000) may require source of funds declaration.

Q. Are there withdrawal limits at foreign currency ATMs?
Different banks have different limits. CTBC: equivalent NT$120,000; Taishin: NT$150,000; E.SUN: NT$50,000 per transaction, NT$150,000 per day. Post-2025 regulations lowered limits to NT$100,000–NT$150,000. During peak times, cash may run out; plan accordingly.

Which method do you choose? Final recommendations

If your budget is NT$50,000–200,000 and your travel date is fixed, the most cost-effective combo is online reservation + airport pickup, minimizing losses and effort.

If you are a forex trader or want to invest in yen, batch online exchange into your account, then transfer to deposits or ETFs, balancing costs and returns.

If you’re in a rush with no time to prepare, ATM withdrawal is the second-best option, available 24/7.

Don’t let “Is it worth exchanging now?” block your decision. The yen’s appreciation potential (against the depreciating TWD) is clear. Instead of hesitating, choose the right method and enter gradually. This way, you minimize costs and avoid exchange rate risks from a single full conversion. Travel more cost-effectively and add a layer of hedging for yourself.