How to Open a Bank Account in Japan

How to Open a Bank Account in Japan

New to Japan and need to open a bank account but not sure where to start. Don’t despair. In this article, I’ll step you through the different banking options available, explain the pros and cons, and give an overview of the process as well.

To start with, take a deep breath and realize that it is going to take more time than expected and at times it might make you want to pull your hair out. Thankfully however it does get better with time and practice.

Here you’ll find four main options when it comes to banking. Starting with the megabanks, as the name suggests they are the largest and make up most of the Tokyo market. Followed, by regional banks in the surrounding areas, then Internet-only banks and then lastly Japan Post Bank.

We will be looking at megabanks and Internet-only banks as I do not have any direct experience with the others and from what I have read do not offer any distinct advantages.

Until a few years ago, Citibank and Shinseki Bank and were the go-to financial institutions for foreigners with either limited Japanese ability or a strong desire to do their banking in English, but this is no longer the case.

Citibank sold their retail business and Shinsei continues to close branches, reduce services and increase fees. I’ve included Shinsei at the bottom of the post for completeness but, I believe there are better options available.

Megabanks

As the name suggests, megabanks make up most of the banking market in Japan. Unfortunately, they have a Japanese language hurdle with no English language support. Over the longer term, I believe they are the better option for most people from a convenience point of view.

Three of the largest megabanks are:

They all offer the same general services. As a side note, I’ve worked for some small firms that asked employees to open accounts at the same bank. They do this to make transferring salaries easier and less expensive. In my case, I used it as an excuse to ask one of the friendly HR department staff if they could help me.

Pros:

  • An abundance of ATMs across Japan with English menus.
  • Most ATM’s are now open 24 hours. It’s hard to believe, but many still close at night.
  • Most offer Visa, MasterCard, or JCB debit cards.
  • Supported by most companies for automatic bill payment (i.e., utilities, phone, gyms, etc.)

Cons:

  • Many ATM’s still have out of hours fees.
  • Most ATM services are only available in Japanese. English menus are limited to only deposits, withdraws, and checking balances.
  • No English language support web or phone support
  • Can take 1 to 2 weeks to receive your ATM and debit cards in the mail.

Internet-only Banks

The main Internet-only banks are Rakuten and Seven Bank. In my opinion, however, this is their only similarity when it comes to customer service and support.

Rakuten Bank while offering some promotional benefits such as cash back and slightly higher interest rates for savings accounts they offer many of the standard services provided by the megabanks. Most of the people I know with a Rakuten Bank account either currently work previously worked for Rakuten in the past, opened a Rakuten credit card, or have other services with Rakuten such an investment account.

Pros:

  • Many of the same benefits as megabanks
  • Can setup account online

Cons:

  • No English language support
  • Internet-only, no branches
  • Requires you to be able to receive a phone call and answer questions in Japanese via phone.

As a side note, I have a Rakuten Securities account. My Japanese skills were strong enough to answer questions for my investment account but not good enough for a bank account. I’m not sure why. Guessing it comes down to the person calling you.

Seven Bank, with full English language support I believe is the new goto financial institution for foreigners. While their services are limited, in comparison to the megabanks and even Rakuen, they do have the best language support and overall streamlined process. Best of all they have ATMs located in all 7-Eleven convenient stores across Japan.

Pros:

  • English language support
  • Availability of ATM and debit cards

Cons:

  • Internet-only, no branches
  • JCB brand debit cards are only available in Japan or other locations such as Guam or Hawaii with many Japanese tourists.

Shinsei Bank

Most of the primary benefits Shinsei previously offered have either gone away or are no longer useful. I believe they are stuck between wanting to be a branch and an Internet-bank.

They have closed almost all of their branches; however, they still require you to go to a Financial Center in person to open an account. They also started charging ATM feels while removing most of their ATMs.

For the last few years, I’ve mainly used them for international bank transfers as they allow you to pre-register one overseas account and let you made transfers via phone for a hefty fee of 3,000 yen plus a percent of the amount sent.

Two of their primary benefits now are multicurrency accounts and the ability to do currency exchange via phone for international transfers. With the introduction of companies like Transferwize offering overseas money transfers at a fraction of the cost, the benefits of Shinsei’s service has gone almost to zero.

Pros:

  • English language Phone support
  • English language Internet banking
  • Multi-currency accounts with FX
  • Able to send money to a pre-registered overseas account

Cons:

  • Must visit their office to open an account
  • Must be in Japan at least six months
  • A limited number of offices and ATMs

What to bring

  • Residence card (Zairyū Card)
  • Passport
  • Tax Number (My Number)
  • Phone number
  • Personal seal (Hanko or inkan)

Recommendations

  • Get a personal seal (kanko or inkan). It only costs about 1,000 yen and while not required for all banks will save you time and pain in the future. It is often necessary for signing official documents like rental and employment agreements. While it is is a bit traditional it guarantees that your “signature” is the same every time and will allow you in many cases to make bank account changes at any branch instead of only the branch where you opened your account.
  • Bank accounts can have only one individual’s name. For married couples, you’re able to request a second ATM and cash card.
  • Accounts usually have a 100,000 yen per day ATM and transfer limits but, these can be raised in the branch or via their Internet banking website.
  • ATMs in Japan don’t usually close any more however they do often go offline on Saturday or Sunday nights. Banks have also been known to close for days if not up to a week at the end of the year. It’s always a good idea to have some extra emergency cash on hand when you need it.

Recommendations for Americans

  • Don’t be surprised if the banks ask you for your social security number. Thanks to the introduction of FATCA (Foreign Account Tax Compliance Act) this has become the new standard.
  • Also, if at any one time during the year you have more than $10,000 or the yen equivalent you will need to report the account to the IRS.

Lastly, I have heard of banks requiring foreigners to have been in Japan for at least six months before being able to open an account. However, I have not personally had this challenge. Please let me know if you have and how you worked around it.

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Charles
Charles Founder of Gaijin Money, highly interested in personal finance and investing.
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