Do Frequent Japan/Korea Travellers Need a Foreign Currency Account? Breaking Down the 1.5% Card Fee and Real Exchange Costs

🌏 中文版

"I go to Japan and Korea a lot — should I open a foreign currency account and pay by card in foreign currency to save money?"

The short answer: whether a foreign currency account helps and whether card payments are cheap are two largely unrelated questions. The 1.5% overseas transaction fee does not disappear because you hold a foreign currency account — even dual-currency cards, which are built around one, still pay it. Where a foreign currency account actually matters is buying banknotes, and there the gap between JPY and KRW is too large to discuss them together. Using Bank of Taiwan's board rates on 2026/8/17, the round-trip spread is 2.45% for JPY via spot rate versus 15.74% for KRW cash — and KRW has no spot rate available at all.

What the 1.5% is made of

Spend ¥10,000 in Japan and your statement carries an extra foreign transaction fee. It comes in two parts, and CTBC's FAQ states it plainly (in Chinese):

In addition to converting the original transaction into New Taiwan Dollars or the agreed foreign currency at the settlement-date rate listed by each card network, the issuer also adds the fee it must pay that network (see table below), plus a foreign transaction service fee calculated at 0.5% of the transaction amount.

Example: C uses a Visa card in Japan (the transaction converts to NT$10,000), so the foreign transaction fee is 10,000 × 1.5% = NT$150.

E.SUN Bank's rate table lists all three networks side by side at 1.5% — no difference between Visa, Mastercard and JCB.

That 0.5% ceiling is not a convention but an explicit rule. Article 6 (Calculation of Exchange Rates) of the FSC's Mandatory and Prohibited Provisions of Credit Card Standard Contracts states (in Chinese):

The issuer may choose not to charge the foreign transaction service fee under paragraph 1. If charged, then apart from the fees collected by each card network, it shall be charged per transaction at ___ percent of the transaction amount (not exceeding 0.5 percent), and no spread may be profited from.

Two consequences are worth remembering: the rule permits a bank to charge nothing at all (so fee-free cards do legitimately exist, they just tend to have lower rebates), but if it charges, it cannot exceed 0.5% and cannot profit from the exchange spread — which is why nearly every bank charges the full 0.5%. Article 9 of the prohibited-provisions half of the same rule separately bans "charging the foreign transaction service fee twice on the same transaction amount."

The key point: none of this calculation has anything to do with whether you hold a foreign currency account. It is a fixed cost on the card clearing path.

The misconception: a foreign currency account or dual-currency card saves the fee

Dual-currency card marketing makes it easy to assume that "paying in foreign currency means no fee." It does not. SinoPac's official terms for its Dual Currency Card are explicit (in Chinese):

Card transactions shall be settled in New Taiwan Dollars or the agreed foreign currency … plus the fee SinoPac must pay the relevant international network and a foreign transaction service fee calculated at 0.5% of the transaction amount (totalling approximately 1.5%–2% of the transaction amount).

SinoPac is not alone. E.SUN's Kumamon JPY dual-currency card page settles it in one line (in Chinese):

Overseas spending on the JPY dual-currency card is subject to a 1.5% foreign transaction service fee.

What a dual-currency card saves you is exchange rate risk, not the fee. Its value is that you can buy yen while it is cheap, park it, and have card spending drawn from that same yen balance — instead of being at the mercy of the rate on the day the merchant claims payment. That is genuinely useful, but it is a separate matter from the 1.5%.

Paths that genuinely waive the 1.5% do exist, but they are narrow and none of them is an ordinary credit card:

• A foreign currency debit card drawing on a same-currency account. DBS's Multi-Currency Debit Card states that when a transaction in one of 14 designated currencies is successfully charged to the holder's foreign currency savings account in that same currency, the 1.5% foreign transaction fee is waived. The conditions are strict: if the balance is short and the charge falls back to a TWD account, the 1.5% returns. Those 14 currencies include JPY — but not KRW.
• Specific mobile payment channels. E.SUN's Kumamon card paired with E.SUN Wallet for PayPay spending in Japan, for instance, lists a waiver of the 1.5% service fee in its benefits. These channels are narrow and the promotions are short-lived.

If your goal is simply to pay less when using a card, finding a card with an overseas rebate above 1.5% is far more effective than chasing a fee waiver. More on that below.

The real trap is DCC, not the fee

When you pay in Japan or Korea, the terminal or the cashier will ask whether you want to settle in local currency or New Taiwan Dollars. Always choose local currency.

Choosing TWD means stepping into DCC (Dynamic Currency Conversion), where the local acquirer sets the rate itself. More importantly, it does not save you the fee — E.SUN's FAQ puts this directly in its warning (in Chinese):

Some overseas merchants settle using the "DCC (Dynamic Currency Conversion) mechanism" … If the merchant converts to New Taiwan Dollars at the rate at the moment of the transaction via DCC, you must still pay the 1.5% foreign transaction service fee.

SinoPac's terms say the same: choose TWD settlement and the transaction "will still be posted in the card's agreed foreign currency, and the 1.5% foreign transaction service fee will still be charged."

So DCC is a bad rate plus the 1.5% anyway — a double loss. On top of that, some banks require foreign-currency settlement to qualify for overseas rebates, so choosing TWD can also disqualify the transaction and cost you the rebate. It is the single largest avoidable cost on the trip, and avoiding it is free.

JPY and KRW: too far apart to discuss together

Where a foreign currency account earns its keep is buying banknotes. Here Japan and Korea have to be separated completely, because Taiwan's banking system treats the two currencies very differently.

These are Bank of Taiwan's board rates as posted at 07:51 on 2026/8/17:

Two things stand out.

First, the KRW spot columns are empty. That is not a printing omission — most Taiwanese banks do not offer account-based trading in KRW, only physical banknotes. Yuanta Bank's foreign banknote page could not be clearer (in Chinese):

For KRW banknotes please visit our Business Department, Chang Gung, Taichung or Yuchang branches. Please note: "our KRW banknotes may only be exchanged against New Taiwan Dollars; other listed foreign banknotes may be deposited to or withdrawn from a foreign exchange deposit account directly."

In other words, "open a KRW account and stock up while the rate is low" is not something most Taiwanese banks let you do. The 13 currencies SinoPac's DAWHO lists as exchangeable (USD, JPY, HKD, EUR, GBP, CAD, SGD, CHF, SEK, AUD, NZD, ZAR and others) likewise exclude KRW.

Second, the spreads differ by an order of magnitude. Measured as round-trip cost — buy it, convert straight back, what is left:

The round-trip cost on KRW cash is 2.5× that of JPY cash and 6.4× that of JPY spot. That is not a gap you can time your way out of.

There is corroboration for this. The travel blog Bobby Travel compared four ways to obtain won at 2026/8/11 rates: exchanging NT$10,000 gave 400,160 won at a Taiwanese bank versus 434,542 won at a Myeongdong exchange booth — a gap of 34,382 won (about NT$859), roughly 8.6%, the same order of magnitude as the one-way cost implied by Bank of Taiwan's board.

So what should you actually do

Japan: a JPY account is worth it, but not for getting banknotes

Buying yen at the spot rate really is cheaper on the board than buying banknotes. Using the board rates above, for NT$10,000:

• Cash sell at 0.2048 → 48,828 yen
• Spot sell at 0.2038 → 49,068 yen
• Difference: 240 yen (about 0.49%)

But you cannot keep that 0.49%, because it is the definition of the withdrawal fee. When you take banknotes out of a foreign currency account, the spread is exactly what the bank charges:

• Bank of Taiwan's foreign currency ATM withdrawal service (in Chinese): "the handling fee is the withdrawal amount multiplied by the difference between the posted cash selling rate and the spot selling rate, minimum NT$100"
• Mega Bank's foreign exchange fee schedule (in Chinese) spells out the formula: "rate = (cash selling − spot selling) / cash selling," minimum NT$100
• Cathay United Bank's fee schedule: "Handling fee for exchange rate difference for cash withdraw from foreign currency deposit account: between the differential CUB's selling spot exchange rate and selling cash exchange rate … with a minimum of NTD100"

Put the 8/17 board rates into Mega's formula and the answer is 0.4883% — the same number as the 0.49% above. Banks charge the cost of physical notes on one side or the other, so routing through a foreign currency account is not cheaper, and with an NT$100 floor, small amounts are worse.

Some banks are dearer still. Per SinoPac's fee schedule (in Chinese), withdrawing banknotes from a foreign currency account costs "other currencies: 1% of the foreign currency amount at the spot selling rate, charged in NTD, minimum NT$100," while pre-ordered banknotes and its own foreign currency ATMs cost 0.9% — all three above the 0.49% spread.

So if all you want is yen banknotes, don't route through a foreign currency account; buying banknotes via online exchange is cleaner. Per the fee terms on Bank of Taiwan's Easy Go foreign banknote system (in Chinese):

No handling fee is charged for online purchases. USD is discounted by 2 points; other currencies (excluding IDR and VND) by 0.1%.

JPY falls under "other currencies." No fee, a rate discount, and you can reserve pickup at a Taoyuan Airport branch instead of making a separate trip to a bank.

So where is the value of a JPY account? Two things, neither involving banknotes:

1. Timing. What you lock in is the exchange rate, not the fee. Buying yen in tranches at the spot rate while it is cheap smooths out currency risk — that is the main value when the yen is volatile.
2. Paying directly from the account. A dual-currency card or foreign currency debit card charges the yen account directly, so the money never becomes banknotes and never pays the banknote spread. This is the path where a foreign currency account genuinely saves money, and it is the flip side of the dual-currency section above: a dual-currency card cannot save you the 1.5%, but it can save you the banknote spread.

In short: pair a JPY account with a card, not with an ATM.

Korea: no account needed, and don't bring much cash

Three reasons:

1. You mostly can't open one. Most banks offer no KRW account — banknotes only.

2. Exchanging in Taiwan is expensive. A 15.74% round-trip spread on banknotes, and an 8.6% measured gap against Myeongdong booths.

3. Korea barely uses cash. Per the Payments Japan Association's international comparison (Cashless Roadmap 2024), Korea's cashless payment ratio was 99.0% in 2022, first among major economies — against Japan's 58.0% in 2025.

   Worth flagging: Korea's 99.0% is a reference value computed on a different basis from the other countries. The association's ratio normally uses World Bank household final consumption expenditure as the denominator and BIS card and e-money payment volumes as the numerator, but "the ratios for China and Korea are calculated from Euromonitor International data and recorded as reference values." So do not treat 99.0% and Japan's 58.0% as measured with the same ruler — different sources put Korea anywhere from 93.6% to 99.0%. For this post's purposes the conclusion is unaffected: every statistic puts Korea above 90%, among the highest in the world.

   The cause is policy. After the 1997 Asian financial crisis Korea introduced income tax deductions on card spending and lottery draws tied to card receipts, and required merchants above a certain annual revenue to accept cards, with penalties for refusing — which is why even street stalls take cards.

In practice: change only a small amount of won in Taiwan for emergencies (enough for airport-to-city transport, and even the airport express and buses take cards), and put the rest on a credit card. If you need more cash, use a local exchange booth or a stored-value card like WOWPASS — both give rates far better than exchanging in Taiwan.

Japan is the opposite. A 58% cashless ratio means roughly four in ten situations still want cash: small shops, shrines, some diners and some transport. Carry some notes.

Cards: the rebate rate is where the money is

The 1.5% on overseas spending is unavoidable, which makes the test very simple: a card with an overseas rebate below 1.5% is not worth taking abroad. A 3% card nets 1.5%; a 5% card nets 3.5% — far more than the fraction of a percent you can squeeze out of exchange rates.

The four below are the terms as of August 2026, each row checked line by line against the issuer's own site (aggregator comparison sites frequently carry stale expiry dates). Even so, this section dates faster than anything else in the post — follow the links and re-confirm before applying:

The Taishin Richart Card's 3.3% "travel" track often appears on lists like this, but read its threshold carefully. Per Taishin's own page, 3.3% is a LEVEL 2 benefit: "completing the setup of 'Taishin account auto-debit for Taishin credit card payments' is required to enjoy the maximum 3.3% benefit rebate; without it, bonus channels earn up to 1.3%." Without the auto-debit setup, 1.3% is below the 1.5% fee — a net loss. The benefit period runs 2026/7/1–2027/3/31.

A few details that are easy to miss when choosing:

• "Overseas spending" is defined differently by each bank. Some go by transaction location, some require foreign-currency settlement, some require both. Transactions with foreign acquirers like Agoda or Netflix count as overseas spending even when you are in Taiwan.
• Uncapped matters more than a high headline rate. Many high rates are bonuses capped at NT$500–1,000 per period; past the cap you fall back to the base rate.
• Refunds don't always return the fee, and it depends on the network. E.SUN, for example, states on its site that "for a VISA card, the foreign transaction service fee generated by the original transaction will not be refunded" while "for Mastercard and JCB cards, the foreign transaction service fee on the refunded amount will be returned." Rules differ by issuer, so check your own card's terms before booking flights or hotels you might cancel.
• Carry cards on two different networks. Terminals occasionally accept only one; one Visa and one Mastercard is the safe combination.

In one line

What will go stale

The parts of this post have very different shelf lives. When revisiting, check these first:

References

Regulation and fees

• FSC: Mandatory and Prohibited Provisions of Credit Card Standard Contracts (in Chinese) — the legal basis for the 0.5% cap
• Lawbank: full text of the amended mandatory and prohibited provisions (in Chinese)
• CTBC: How foreign transaction fees are charged (in Chinese)
• E.SUN Bank: What fees apply when using a credit card overseas (in Chinese)

Dual-currency cards and foreign currency debiting

• SinoPac Dual Currency Card: official benefits and notes (in Chinese)
• E.SUN Kumamon Card, including the note that the JPY dual-currency card still pays 1.5% (in Chinese)
• DBS Multi-Currency Debit Card: 1.5% foreign transaction fee waived when charged to a same-currency account (in Chinese)

Exchange rates and conversion

• Bank of Taiwan board exchange rates
• Bank of Taiwan Easy Go foreign banknote system: fee terms (in Chinese)
• Bank of Taiwan: foreign currency ATM withdrawal from FX deposit accounts (in Chinese)
• Mega Bank: foreign exchange business fee schedule (in Chinese)
• Cathay United Bank: foreign currency cash fee schedule
• SinoPac: schedule of fees and charges (in Chinese)
• Yuanta Bank: exchangeable foreign banknote currencies and denominations (in Chinese)
• SinoPac DAWHO: currencies available in a foreign currency account (in Chinese)
• Money101: how to exchange currency most cheaply, including per-bank counter fees (in Chinese)
• Bobby Travel: comparing four ways to obtain Korean won (in Chinese)
• Mr. Market: five common ways to exchange currency, compared (in Chinese)

Card benefits (all issuer official pages)

• E.SUN Kumamon Card: Kumamon Goes to Japan campaign (in Chinese)
• Taipei Fubon J Card: up to 6% in Japan/Korea/Thailand (in Chinese)
• DBS eco Card (in Chinese)
• HSBC Cash Rewards Signature Card (in Chinese)
• Taishin Richart Card benefit tiers (in Chinese)

Cashless payment ratios

• METI: Japan's 2025 cashless payment ratio (in Japanese)
• Payments Japan Association: international comparison of cashless ratios, including the note that China and Korea are Euromonitor reference values (in Japanese)