How to Pay for Things in Japan Using a Card
Japan, where tradition meets modernity, presents a unique landscape for handling money. As a traveler, being well-prepared to manage your finances efficiently while exploring this fascinating country is essential.
While Japan is technologically advanced, cash remains a predominant mode of payment. You can however, use your card in many places across the country.
With foreign-friendly ATMs still somewhat elusive and over-the-counter card payments patchy, the best way to pay for things in Japan involves combining a number of options:
Paying with Your Australian Debit Card
It’s not a good idea to assume your Australian debit card will be accepted in all stores, restaurants, and other businesses.
In fact, there are mixed reports on just how easily debit cards can be used over the counter in Japan.
In any case, even if they are accepted, you may still incur currency conversion and foreign transaction fees. You might also get a bad conversion rate.
But it’s always handy to have your debit card on you as an emergency backup if you need to withdraw more money from an ATM.
In that case, look for Citibank or ING debit cards, which waive currency conversion fees, international ATM fees, and account keeping fees (with some provisions).
One of the best travel money cards for Japan is the Wise Travel Card, which doesn’t have purchase, load, or reload fees and offers the same exchange rates as those you see on Google or XE.com.
Buying Prepaid Travel Money Cards
With a travel money card, you can preload Japanese yen onto a card that acts like a debit card. This has the advantage of locking in the exchange rate and providing an extra security buffer, since most travel cards come with replacement or backup options.
But there are a few caveats. Firstly, it can take up to three business days for the money to be loaded onto your card so it’s not good in an emergency.
And while you don’t have to pay currency conversion fees, you still face fees for initial loading, reloading, and using ATMs.
You can get a prepaid travel card from most major banks, many airlines (if you’re a member of their loyalty club), or some currency exchange providers like Travelex.
Paying with a Credit Card
Using a credit card in Japan comes with some great advantages but also some big pitfalls.
To begin, credit cards offer better fraud protection than other bank cards and serve as a good backup for emergencies. Many credit cards also come with frequent flyer or rewards programs and (a big one) travel insurance.
In Japan, credit cards are best kept for the big-ticket purchases: hotels, rental cars, and flights and transport.
It’s best to assume your card won’t be accepted by most small businesses but major hotels, department stores, and other big businesses accept them. American Express will be harder to use than Mastercard or Visa.
Credit cards do come with some disadvantages. You could face hefty fees when using your card; foreign transaction fees often add up to 3% of the amount charged.
And, as we’ve mentioned, you should avoid using your credit card for ATM withdrawals altogether.
If you’re looking for a travel-friendly credit card, try the 28 Degrees credit card.
Learn more: The Best Travel Prepaid Cards to Use Overseas
A Note on Dynamic Currency Conversion (DCC)
In the UK, a vendor might ask if you’d prefer to be charged in Australian dollars or British pounds when you’re paying with a card.
This system – called dynamic currency conversion (DCC) is a bit of a scam and best avoided. The foreign currency conversion rate is set by the retailer and is typically far worse than what your home bank would charge.
Buying an IC card
IC cards used to be simple prepaid public transport passes in Japan but you can now use them widely to pay for items in shops, cafes, and vending machines beyond the transport hubs.
In fact, some sightseeing and tourist businesses offer discounts for payments made with an IC card.
There are ten major IC cards in Japan, which are valid on pretty much all trains and buses in most of Japan’s major cities. You can buy and recharge IC cards in train stations across the country.
