Local Currency in Japan

Currency in Japan

The Japanese currency is the Japanese yen, abbreviated ¥ (or JPY in foreign exchange contexts). As of July 2012, the yen hovers at around 79 to the US dollar, although the yen has drastically weakened to the rate of roughly 93 yen to the US dollar as of February 2013. The symbol 円 (pronounced en) is used in the Japanese language itself.

• Coins: 1 (silver), 5 (gold with a center hole), 10 (copper), 50 (silver with a center hole), 100 (silver), and 500 yen. There are two ¥500 coins, distinguishable by their color. (The new ones are gold, the old ones are silver).

• Bills: 1,000 (blue), 2,000 (green), 5,000 (purple), and 10,000 yen (brown). ¥2,000 bills are rare. New designs for all the bills except ¥2,000 were introduced in November 2004, so there are now two versions in circulation. Most merchants will not object to receiving a ¥10,000 bill even for a small purchase.

Japan is still fundamentally a cash society. Although most stores and hotels serving foreign customers take credit cards, many businesses such as cafés, bars, grocery stores, and even smaller hotels and inns do not. Even businesses that do take cards often have a minimum charge as well as a surcharge, although this practice is disappearing. The most popular credit card in Japan is JCB, and due to an alliance between Discover and JCB, Discover cards can be used anywhere that accepts JCB. This means that Discover cards are more widely accepted than Visa/Mastercard/American Express. Most merchants are not familiar with this, but it will work if you can convince them to try!

The Japanese usually carry around large quantities of cash — it is quite safe to do so and is almost a necessity, especially in smaller towns and more isolated areas. In many cities, the Japanese can also use mobile phones to pay for their purchases where mobile phones function like credit cards and the cost is billed to them with their mobile phone bill. However, a Japanese phone and SIM card is required to make use of this service so it's typically not available to foreigners on short visits. If you already have a Japanese phone, be aware that initializing the prepaid card on a rental SIM will incur data charges, though this will most likely be less than the cost of a physical card. This can be avoided by using WiFi.

Almost any major bank in Japan will provide foreign currency exchange from US dollars (cash and traveller's checks). Rates are basically the same whichever bank you choose. Having to wait 15-30 min, depending on how busy the branch gets, is not unusual. Other currencies accepted are euros; Swiss francs; Canadian, Australian, and New Zealand dollars; and British pounds. Among other Asian currencies, Singapore dollars seem to be the most widely accepted, followed by the Korean won and Chinese yuan.

Exchange rates for US dollars and euros are typically very good (about 2% below the official rate). Exchange rates for other currencies are very poor (up to 15% below the official rate). Other Asian currencies are generally not accepted (currencies from nearby countries, like won, yuan, and HK$, are exceptions). Japanese post offices can also cash traveller's checks or exchange cash for yen, at a slightly better rate than the banks. Traveller's checks also have a better rate of exchange than cash. If you are exchanging amounts in excess of US$1,000 (whether cash or T/C), you will be required to provide identification that includes your name, address, and date of birth (to prevent money laundering and the funding of terrorism). Since passports usually do not show your address, bring along another form of ID such as a driver's license that shows your address.

Japanese ATMs, known locally as cash corners (キャッシュコーナー kyasshu kōnā), generally do not accept foreign cards and the availability of credit card advances, known as cashing (キャッシング kyasshingu), is spotty. The major exceptions are:

• Over 12,000 Japanese 7-Eleven stores with ATMs accept foreign cards for cash withdrawals. Accepted cards include Mastercard, Maestro, Visa, American Express, JCB and UnionPay, and ATM cards with the Cirrus and Plus logos. These are the most useful as they are everywhere and are accessible 24/7.

• JP Bank (ゆうちょ Yū-cho), formerly the Postal Savings Bank and hence found in almost every post office, which in turn has a branch in almost every village. Most postal ATMs provide instructions in English as well as Japanese. Plus, Cirrus, Visa Electron, Maestro, and UnionPay are accepted, and you can do credit card advances on Visa, Mastercard, Amex and Diners Club. Your PIN must be 6 digits or less.

• Citibank, which has a limited network but does have ATMs at the major airports.

• HSBC (香港上海銀行) ATMs are few and far between, but these are capable of taking Visa and MasterCard.

• Shinsei Bank (新生銀行) ATMs, which accept Plus and Cirrus, are located at major Tokyo Metro and Keikyu stations, as well as in downtown areas of major cities.

• SMBC (三井住友銀行) ATMS will take UnionPay cards for a ¥75 surcharge. You MUST change the language to either English or Chinese before inserting the card; the machine will not recognize it otherwise.

• Mitsubishi UFJ(三菱東京UFJ銀行) ATMs will take UnionPay, foreign-issued JCB, and Discover cards for no surcharge. Be aware that you MUST press the "English" button first; their ATMs will NOT recognize non-Japanese cards in Japanese-language mode.

• AEON (イオン銀行) ATMs will take UnionPay for no surcharge. Here you must press the "International Cards" button.

Notice the trend of "local" Japanese banks going with UnionPay (and MUFG accepting Discover as well). While 7-Elevens are everywhere, having more options is always recommended, so try to get either a UnionPay or Discover debit card before arrival for increased convenience (for instance, at Narita Airport, there are the "usual" foreign-capable ATMs on the 1st floor of Terminal 2 that get crowded when the international arrivals start coming, whereas the Mitsubishi-UFJ ATMs on the 2nd floor are wide open during most hours).

One thing to beware: many Japanese ATMs are closed at night and during the weekends, so it's best to get your banking done during office hours! An exception is 7-Eleven, which is open 24 hours.

Also, three notes for those with UnionPay cards:

1. 7-Bank and Yucho both take an additional ATM fee of ¥110 in addition to the fee charged by the issuer. SMBC only takes 75. Aeon and MUFG charge nothing at all, so it's best to withdraw cash while their ATMs are active.

2. Your UnionPay card number MUST start with 6. If the first digit is something else and it does not have the logo of another network it will not function at all in Japan. Change it out for another one. If the initial digit is 3/4/5 AND it carries the logo of another network (Visa/MasterCard/AmEx) it will NOT function in SMBC/MUFG/Aeon ATMs, only in the ATMs of the other network (Yucho/7-Bank/HSBC/Citi/Shinsei).

3. The illustration on the SMBC/MUFG/Aeon ATMs show the card being inserted mag-stripe up. This is only for Japanese cards; UnionPay (and Discover for MUFG) cards are to be inserted the usual way.

On top of these, there are cash dispensers (abbreviated to CDs in Japan), intended for credit card cash advances. Some will work with foreign-issued ATM/debit/credit cards.

• SMBC, UC Card, and Mitsubishi UFJ Card machines will take Visa and MasterCard.

• Orico machines will take MasterCard only.

• JCB machines will take Visa, MasterCard, American Express, JCB, and UnionPay.

Note the difference between CDs and ATMs, even for the same financial institution. For example, for foreign-issued cards SMBC and MUFG bank ATMs take UnionPay (MUFG also takes Discover), while SMBC and Mitsubishi UFJ Credit cash dispensers take only Visa/Mastercard.

A note for those using SMBC/MUFG/Aeon ATMs: on-site staff at most branches are still unaware that their ATMs now accept foreign cards at all. If you're having trouble, pick up the handset next to the machine to talk to the central ATM support staff.

Vending machines in Japan are known for their pervasiveness and the (notorious) variety of products they sell. Most will take ¥1,000 bills, and some types such as train ticket machines will take up to ¥10,000; none accept ¥1 or ¥5 coins, nor ¥2,000 notes. And even the most high-tech vending machines do not take credit cards, save for certain ones in train stations (though there are limitations — for example, JR East ticket vending machines require a PIN of four digits or less; most credit card customers would be better off purchasing from a ticket window). Note that cigarette vending machines require a Taspo card (age verification), which are unfortunately off limits to non residents, but local smokers are usually happy to lend you theirs.

Prepaid electronic cards are quite popular in Japan for small purchases. There are cards for train fares, convenience store purchases, and public telephones, though they aren't interchangeable.

There is a 5% consumption tax on all sales in Japan. As of April 2004, the tax must now be included in all displayed prices (which is why so many prices are awkward amounts like ¥105 or ¥525), but some stores still also display tax-excluded prices, so pay attention. The word zeinuki (税抜) means tax-excluded, zeikomi (税込) means tax-included. If you cannot find out any words in the price card, most of them are tax-included.

Always keep a sizeable stack of reserve money in Japan, as if you run out for any reason (wallet stolen, credit card blocked, etc), it can be difficult to have any wired to you. Western Union has a very limited presence even in the larger metropolitan areas (their agreement with Suruga Bank ended in 2009, and they have just started a new agreement with Daikokuya as of April 2011), banks will not allow you to open accounts without local ID, and even international postal money orders require proof of a residential address in Japan.

Tipping

Tipping effectively does not exist in Japan, and attempting to offer tips can often be seen as an insult. Japanese service is legendary, and you do not need to bribe the waiters/waitresses to do their job properly — if you leave a tip in a restaurant, the staff will probably come running after you to return the money you "forgot". Even bellhops in high end hotels usually do not accept tips. The only exceptions are high-end ryokan and English-speaking tour guides.

That said, some restaurants do add a 10% service charge, and family restaurants may add a 10% late-night charge after midnight.

Costs

Japan has a reputation for being extremely expensive — and it can be. However, many things have become significantly cheaper in the last decade. Japan need not be outrageously expensive if you plan carefully and in fact, is probably cheaper than Australia and most European Union countries for basic expenses. For long-distance travel, in particular, the Japan Rail Pass, Japan Bus Pass, and Visit Japan flights can save you a bundle.

As rough guidelines, you will find it very difficult to travel on less than ¥5,000 per day (but if you plan carefully, it is certainly possible) and you can expect a degree of comfort only if you pay 10,000. Staying in posh hotels, eating fancy meals or just traveling long-distance will easily double this yet again. Typical prices for moderate budget travel would be ¥5,000 for hotel, ¥2,000 for meals, and ¥2,000 again for entry fees and local transport.

However, if you find yourself a little short on cash, you can get your essential items in one of the many ¥100 shops (百円ショップ hyaku-en shoppu) located in most cities. Daiso is the Japan's largest ¥100 shop chain, with 2,500 shops across Japan. Other large chains are Can Do (キャンドゥ), Seria (セリア), and Silk (シルク). There are also convenience-store-like ¥100 shops such as SHOP99 and Lawson Store 100 where you can buy sandwiches, drinks, and vegetables in addition to selected ¥100 items.

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