An Overview on Banking in Japan

Welcome back to another deep dive article! For this article, we will be looking deeply into Japanese bank accounts to help you get the best bang for your buck.

As this article contains a large amount of information, please feel free to use the table of contents to jump to the section most relevant to your needs.[ps2id id=’table-of-contents’ target=”/]

Table of Contents

How to Open a Bank Account in Japan

Cash Cards, Credit Cards, Debit Cards and the Introduction of “Cashless”

English Banking Options in Japan

The official currency of Japan is the Japanese Yen (Symbol: ¥ – Code: JPY).  To the surprise of only a very few, only Japanese yen is accepted in Japan outside of some very unique circumstances. However, to the surprise of many, Japanese people will often pay even important sums in cash. Having cash on hand is normal for the current Japanese way of life. As this is the most popular method of payment in Japan,  some rural areas and businesses will only accept cash payments. You may find yourself surprised when the only way to pay for those yummy snacks is with cold, hard cash! The prevalance (or lack thereof) of credit, debit and e-money options is yet another cultural difference foreigners will need to navigate while in Japan.

That being said, bank transfers are more commonly used in Japan than in Europe. Another difference is that the Japanese do not use checks nor can one pay with a check from a foreign bank. In addition, paying with traveler checks in Japan has become extremely rare. Foreign nationals must also be aware that ATMs in Japan do not always accept credit, debit, or ATM cards that were issued outside of Japan. The ATMs most likely to accept cards issued outside of Japan are found in post office branches and 7-Eleven convenience stores, which also offer English menus. International ATMs can also be found at international airports as well as at Prestia and Shinsei Bank branches, though they are much less common.

In this article, we would like to go over the challenges and nuances most commonly faced by foreign residents in Japan. From opening up a new account to figuring out how to get a Japanese credit card, foreigners can often find themselves a bit mystified by the banking system here compared to their own home country. Add a language barrier on top and you have a recipe for a potential headache.

Having a Yen Bank Account in Japan

For medium- and long-term residents, opening a Yen account in a local Japanese bank can be very convenient for daily living and local expenses. In this way, fees for withdrawing money from overseas and exchange rates can be avoided. Moreover, it is possible to set up an automatic withdrawal from your bank account to cover major utility costs; which is very convenient when you consider the automatic bill payment service is free and the alternative is to bring the bills each month to a convenience store or bank and make cash payments since Japan is still a cash-based society and there is no checking account system in place for everyday use.

You can request a form to set up automatic payment when you open up a Yen bank account. Usually, the opening hours of Japanese bank desks are short: from 09:00 AM to 3:00 PM from Monday to Friday and closed during weekends + National holidays. You have to be patient, as waiting times can be long at banks. This can be doubly so with banks that have implemented online reservation systems which will leave walk-in appointments waiting. However, the ATM sections of banks have longer operating hours, and those available in convenience stores and other 24 hour locations are always in operation. There are many banks in Japan: Mizuho, Shinsei Bank, Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group, SMBC Trust Bank Prestia…nevermind the local banks and credit unions! Japanese banks offer a general savings account (Futsū yokin) and a range of account options including savings, current, and foreign currency accounts.

Issues Foreigners Face When Choosing a Bank Account

The main issue with Japanese banks for a foreign national is that English support language is virtually non-existent in most local branches and agencies of the banks. Dealing with Japanese banks can be difficult if you are not accompanied by a Japanese friend or if you do not understand the Japanese language. (There are two banks that offer English services and have English-speaking staff that can assist with most banking functions; more below).

Another consideration to keep in mind when opening a local bank account is the availability and location of ATM machines and branches. Each bank offers specialized savings accounts and the operation and fees of their ATMs also vary. Many banks and convenience stores charge fees for after-hours withdrawals, as well as when making payments or performing other personal banking matters on their ATMs. Furthermore, certain banks have agreements with other banks and convenience stores where transaction fees are waived during certain times on certain days for certain features…the list of information to remember can feel quite long!

Lastly is to consider why you are opening an account. If you plan to move money into the account and have it on hand, then choosing a bank based on conveniences and features is definitely the way to go. However, if you are opening a bank account for receiving salary, be aware that your company may want you to open at not just a specific bank but a specific bank branch as well. Double check with your company’s human resources department if you are unsure.[ps2id id=’how-to-open-a-bank-account-in-japan’ target=”/]

How to Open a Bank Account in Japan

• You have to go in person to the bank. You cannot ask a representative or someone else to go to the bank and open the account on your behalf.
• You must have in hand the following required documents.  (Please note this is a general list. Each bank may have slightly varied requirements)
  • A passport + long stay valid visa page
  • A valid residence card (Zairyu Kādo). Most banks do not allow tourists to open an account and require proof of more than 1 year of residence in Japan.
  • If possible, your MyNumber (Kojin Bangō).
• Fill out the bank application form presented by the bank employee.
• You must have a current valid address and phone number in Japan.
• Some banks might ask that you sign with your personal seal (Hanko). They may also ask you to sign your name in Katakana (Japanese syllabic characters used for foreign words and names). Please note that foreign nationals with lengthy names or multiple middle or last names may see their names truncated to fit within certain character limitations. Others may see their name printed onto their bank book up until a certain point where the bank staff may jot the rest of the name down in pen!
• Citizens of certain countries (e.g. The United States) may find themselves met with additional paperwork to ensure compliance with tax laws. It would be a good idea to bring along your country’s equivalent of a Social Security card to ensure the entire affair can be concluded in one trip. For further information, see here about FATCA compliance for residents of the United States.

Japanese banking regulations do not permit joint bank accounts so it is recommended that you request an additional bank card for your spouse, which will be issued for a nominal fee. Then, the bank will process the paperwork, and a cash card and a PIN (Personal Identification Number) will be sent. You should also receive a bank book. Your bank details will show the 3-digit sort code of your local branch (Misebangō) and your 7-digit account number (Kōzabangō).

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Cash Cards, Credit Cards, Debit Cards and the Introduction of “Cashless”

While credit card payments are becoming common, Japanese people use cards less frequently than in Western countries. Debit cards and e-money options are not as widely embraced as the West, either. This is gradually changing as the Japanese government is spearheading a massive initiative to have cashless payment options become widely adopted and accepted but the current state of progress is still a far cry from what many foreign residents may be used to.

In most cases, you will receive a “cash card” which allows access to features offered at the bank’s ATMs but does not allow for purchases in-store or through the internet. It is important to not confuse a cash card with a credit or debit card. Some banks have begun to offer cash cards that can function as debit cards similar to other countries.

A payment card is difficult to obtain, often requiring a long period of residence in Japan and the ability to justify sufficient work and regular income. As mentioned above, cash is the usual method of payment in Japan but credit cards are increasing in popularity and now commonly accepted by stores, online shopping websites, gas stations, supermarkets, etc. However, be aware that a lot of Japanese tourism revolves around historical sites. If the area’s claim to fame lies with the preservation of history, do not be shocked if the local restaurants or gift shops do not accept credit or debit cards. Foreign nationals should be aware that their Japanese credit card application could be rejected even with a credit history in their home country.

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English Banking Options in Japan

Japanese Banks for foreigners (Big 2)
Website Link
Online Application Form
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SMBC Trust Bank (often referred to by the Prestia brand name) and Shinsei bank are the two banks that offer robust customer service in English.

While ATMs may have limited English menus for withdrawing & depositing funds, they often leave out menus for advanced functions such as making bank transfers from account to account. Online banking also is often only in Japanese. Therefore, most expats choose to open an account with one of the banks below that provide English support.

Prestia (SMBC Trust Bank)

SMBC Trust Bank Prestia is a brand formed by SMBC Trust Bank after their purchase of Citibank Japan. They offer a good standard of English-language support, both in branch and online, and provide a supplementary card for spouses (although there are no joint accounts in Japan).
Please be aware that after the first three months of opening an account, a minimum average balance of JPY 500,000 (JPY 200,000 if denominated in foreign currency) is required in order to avoid the monthly account maintenance fee of JPY 2,000 plus sales tax, as well as that you have to pay a small fee for withdrawing cash from all non-SMBC Trust Bank Prestia Brand ATMs if your average monthly balance is below JPY 1,000,000.

PROS
+ Good standard of in-branch English support
+ Supplementary card for spouses

CONS
– Average minimum balance of JPY 500,000 required to avoid maintenance fees (JPY 2,100/month)
– Fees for using non-SMBC Trust Bank Prestia Brand ATMs
– Customers who have not resided in Japan for more than 6 months will need additional documentation.

Can I open a bank account without visiting a bank branch office? Yes, online applications either via smartphone or PC are possible.

Please click here for the application page and please click here for detailed information about the application process.

Shinsei Bank

Shinsei Bank is a Japanese bank that copied many of the services provided by Citibank before its withdrawal from the Japanese market. As with Prestia, Shinsei’s account allows customers to buy, sell and hold a variety of foreign currencies. In addition, Shinsei’s branches, although limited in number, have longer opening hours than other Japanese banks, being open until 5.00 pm (although unable to handle cash after 3.00 pm). Commission fees will be charged from October 2018 for JPY 108.

PROS
+ Easy to open an account
+ No account keeping fee
+ Telephone and online banking available in English

CONS
– Less English-language support available in branch
– Fees apply for ATM withdrawals at convenience stores for customers who do not meet the criteria to be a Gold customer (average balance above JPY 1,000,000)

Can I open a bank account without visiting a bank branch office? Yes, though you will be sending your application via mail. Please click here for more information.

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What about the Post Office Bank? Are there any other good banking options?

While certainly a common first bank choice for many long-term foreign residents of Japan, the post office’s Japan Post Bank often lacks the features of either Shinsei or Prestia and thus is hard to recommend over either. While the major post office branches (usually the distribution/collection center for your city or ward) may have an English speaker on hand, there is no guarantee that English service would be available at the particular day or time you choose to go.

However, the Japan Post ATMs tend to play nicely with many cards issued overseas so it is always good to keep in mind your local ATM’s location in mind.

Other banks tend to require a decent amount of Japanese skill to have the application process smooth. English support, if available, is usually not intuitively obvious and requires a good amount of patience.

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We hope this article has helped you with obtaining a Japanese bank account that satisfies your needs. While the process can feel a bit, dare we say, foreign at first, it is still possible to get a bank account in Japan that can help you do everything you need to live life comfortably.

Have any further questions for discussion? Let us know in the comments!