About the Japanese Yen
The Japanese yen is the currency of Japan, issued by the Bank of Japan. It is the third most traded currency in the world, after the US dollar and the euro.
For decades Japan kept interest rates near or below zero. The Bank of Japan held a negative policy rate from 2016 until March 2024, which made the yen a popular currency to borrow in order to buy higher-yielding assets elsewhere. When those trades unwind, the yen can rise sharply.
The yen is also seen as a safe haven. When it weakens too fast, Japan's Ministry of Finance can step into the market to buy yen, as it did in 2022 and 2024. The Bank of Japan holds eight monetary policy meetings a year.
Paying in JPY
- Account details
- Japan does not use IBANs. A domestic account is identified by a 4-digit bank code, a 3-digit branch code, the account type (ordinary or current) and a 7-digit account number. Payments from abroad need these together with the bank's SWIFT/BIC code.
- Account names
- Japanese banks register account names in katakana. For a payment from abroad, give the recipient's name in Latin letters exactly as their bank has it on file, and ask them to confirm it.
- Domestic clearing
- Yen payments between Japanese banks go through the Zengin system. Many banks now settle domestic transfers in real time, around the clock.
- Reporting large payments
- Under Japan's Foreign Exchange and Foreign Trade Act, payments to or from abroad of more than ¥30 million must be reported to the Ministry of Finance. Japanese banks will ask for the purpose and the counterparty.
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