If you want to open an account at a major bank, it is as easy as walking into the nearest branch – if you speak Japanese. If not, you might want to bring a friend.
Typically anyone can open an account, so long as you are a legal resident. This means no tourists, but most anyone else. There is apparently a rule that you must be here for 6 months or more, but apparently this is enforced by some banks more than others.
Since a basic bank account does not allow you to run a negative balance or borrow money, there is generally no credit check or credit history needed.
You will be asked to provide identification, which for a foreigner might include your MyNumber card, Zairyu card, health insurance card and/or your passport. You may be asked to provide a copy of your Jyuminhyo (residence record), which you can get from city hall. They may ask for information on your employer as well. Basically, the only two real requirements are that you are a legal resident, and you will be in Japan at least 6 months.
You may or may not be required to provide an Inkan (Stamp), so you may want to have that made up ahead of time. Some banks will allow signature instead. You will need an Inkan eventually if you live in Japan, so you may as well get one made.
There are two basic types of accounts
All you need to know is that Futsuu means “normal”. This is the type of account msot everyone has. You can accept direct deposits from your employer, and set up direct debits for things like electricity and gas payments.
Most banks do not charge any monthly fee for maintaining an account, and don’t charge any fee to open an account either – this means you can feel free to set up multiple accounts at different banks if that’s useful to you.
Typically a bank will not let you set up accounts at more than one branch, and will not let you set up more than one account of the same type. This is one reason why people will often hold accounts at multiple banks.
Technically, banks will pay you interest on your balance – but in practice, the interest rates are so low in Japan that you may as well consider the account to be interest free.
You can of course earn slightly higher interest by opening a time deposit account (CD), but even then the interest is so low as to not be worthwhile for most people.
Typically banks have no minimum balance, but you may get some perks by having a higher balance or setting up direct deposit for your paycheck. Examples would be reduced ATM or transfer fees.
Banks will usually offer you a “Cash Card” (ATM card), which you will probably want to accept. There are various options, including the ability to use the ATM card at convenience stores such as 7-11. You might have to pay more when you use a convenience store ATM, but they are usually located more conveniently than your bank’s ATM corner, and almost always open 24/7.
Manually Transferring Money
You can easily transfer money to anyone else’s account using your ATM card, or online – so there is really no need for services like Vinmo or PayPal for domestic payments.
The information you’ll need to know to transfer money is the following:
- The financial institution name or 4 digit code
- The branch name or 3 digit code
- The account type (Probably Futsuu)
- The account number
- The account holder’s full name in Katakana
If you know those pieces of information, you can transfer money from your account using your ATM card, or with internet banking. You may need to at least be able to read enough Japanese to select the bank name and branch name from a list, or enter the first few characters into the ATM or internet banking.
Once you have entered the bank, account type, and account number, one of two things will happen:
- The ATM/web site will display the account holder’s name in Katakana
- The ATM/web site will ask you to enter the account holder’s name in Katakana
Either way, the purpose here is to confirm that you didn’t mess up the information and that the person (or company) you are sending money to is correct. Once you have confirmed this, then the payment will go through. Once you have sent the payment, the money is gone, and there is typically no easy way to get it back.
The checks are typically done in real-time, but if somehow the payment was sent to an invalid account, the money would be returned within a few days. Otherwise, the money now sits in the account of the person you sent it to.
You can of course use this method to send money between your own accounts.
Note: JP Bank uses a different system, but the account information can be transformed to conform to the system listed above.
Transfers used to only take effect during business hours on business days, and could take several hours if you were sending to a different bank. This meant that even if you sent money on a weekend or holiday, the money would not arrive until the next business day (even though it would disappear from your account immediately).
Recently, there is a new “instant transfer” system being instituted at most banks. This system will always transfer the money in less than 10-15 minutes between participating banks, any time of any day (unless they are undergoing maintenance). You don’t need to opt into this in most cases, it’s automatic.
Not all banks subscribe to this new system, though, so if you have an account that doesn’t (like Prestia), then you might need to wait a bit longer for transfers to clear.
Where do you find the information for your bank, branch, and account number? The branch and account number are printed on your cash card.
Note that because you can just transfer money to anyone, any time: Personal checks aren’t really a thing.
Passbook vs. Eco
Japanese accounts traditionally issue Tsucho (Passbooks), which can also be used at the ATM, and will print a record of your transactions. More recently, banks are pushing “Eco” accounts, which do away with the passbook. It’s most cases, it’s your choice. You can usually get both a passbook and an cash card (ATM card) on the same account. It is expected that passbooks will eventually be phased out – as some banks already charge extra for the use of passbooks.
Note that banks don’t typically send paper statements since the idea is that you have a passbook instead, or reference your statement online if you have subscribed to Eco Tsucho. Bear in mind that if you need an official paper record of your balance for a loan application, visa application, etc. and you have switched to a passbook-less account, then you may need to ask for a balance statement printout. This can be a hassle and take several days. The bank will also not retain your records forever – so you might want to save or print your bank data once per year if you might need to check it later.
Debit Card Features
Banks will also sometimes ask you if you want to have a debit card feature on your ATM card. This has nothing to do with the “Check Card” type feature often offered by foreign banks where you get a Visa logo or something like that. If a mega bank asks you about a debit card feature, they are likely talking about J-Debit, which is a system that lets you pay with your ATM card at some merchants, such as Bic Camera.
The Check Card, or Visa Debit card type feature has also become available at many banks over the past few years. This is typically called a “Shopping Card” by the big banks.
Sometimes this will be a debit card that has both a credit card number and cash card features, sometimes there will be two separate cards issued. I believe the reason for this is that the IC part of the card could be Visa, or Cash, but not both, so there was a decision to be made by the banks about whether to use only Mag Stripe for one feature, or wanting to have the extra security of using IC for both.
Another thing to consider is that like real credit cards, check card style cards have expiration dates, whereas normal Cash cards issued by Japanese banks do not. The larger banks tend to issue the cash cards and shopping cards as two separate cards. Recently, cards combining both features are becoming more common. For example, SMBC Olive combines Cash Card (ATM), Debit card, and credit card features into a single physical card.
For example:
- SMBC offers a Visa debit card that supports both Visa contactless payment and iD debit. It has an IC chip so you can use it at stores, and a number printed on it which you can use online. It also has a PLUS logo on the back, which I believe means that it can be used for cash withdrawels overseas.
- MUFJ offers a Visa debit card that supports Visa contactless, but not iD or QuickPay, making it less convenient in Japan.
- Rakuten bank offers Visa or JCB built into their cash card if you apply for it.
- Prestia (SMBC Trust) offers a multicurrency combined Cash & Shopping (debit) card that works with Visa Touch and iD Debit.
- JP Bank recently started offering Visa debit cards as well, and their cards are integrated debit/cash cards.
- Sony bank offers a multicurrency combined visa debit/cash card.
- au Jibun Bank only offers a basic ATM card, but their app will generate a virtual card with a number than can be used for online shopping, and QuickPay contactless payment from your phone.
Most banks will issue a shopping card with Visa or JCB, and a few with Mastercard. Some banks, like Rakuten bank will allow you to choose. Being Japan, I would choose JCB if given the option, but if you plan to use the card overseas, then Visa or Mastercard may be a better option. This includes if you want to use the card to pay for subscriptions to overseas web sites, etc. (though bear in mind this won’t work with some sites anyway, if they want to verify your address and don’t support Japanese addresses).
Some shopping cards will support Visa Touch, iD, or QuickPay. iD and QuickPay are the native Japanese options for postpaid (or in this case, real time debit) contactless payment, Visa Touch may work overseas. Some cards even have both, or have one built into the card, but will let you set up the other on your phone. You really want to get both, because iD and QuickPay are supported many more places in Japan than Visa Touch. These options will deduct money from your account the instant that you use them, and so require a balance in your account, but they don’t need to be charged.
Some banks will issue cards that include other forms of contactless payment, including Waon (Aeon Bank), Nanaco (Seven Bank), EDY (Rakuten bank), Suica (JP Bank and others). These are all convenient, especially the Suica (since you can use it to ride the bus, subway, and train), but they are prepaid, and have to be charged before you can use them. You can charge the Suica and Nanaco cards at any 7-11 ATM, and of course Suica can be charged in train stations as well.
It’s interesting to note that a new trend is that many new credit cards are “numberless” (often called “NL”), meaning that they don’t have any number on them at all, and there is no mag stripe. They only work with an IC reader. This means they can’t be used for online purchases, but they may allow you to generate temporary numbers on their net banking site or app. This trend may filter over to debit cards in the near future. A separate card with a credit card number printed on it is often shipped with these cards – this card can be kept safely at home and used for online purchases.
Apps
Most banks now have smartphone apps, though what you can do in these apps differs wildly between banks. Some only allow you to check your balance, while others will act as an OTP, allow transfers, set up contactless payments, and sometimes even withdrawals & deposits. In particular, PayPay bank and au Jibun bank both have apps that allow you to scan a QR code at the ATM and withdraw or deposit money without an ATM card. Seven Bank even allows the use of facial recognition at 7-11 ATMs.
OTP Tokens
Many banks allow you to request onetime password tokens. These will either be in the form of a physical token or a special app that allows you to generate a code which you must input to the web page in order to proceed with transfers, etc. For example, Mitsubishi UFJ bank will give you a physical token or you can set up their app to generate codes. Often times, the app will be free, but there will be a small charge for a physical token. The physical token is better in some ways, as you won’t need to worry about anything when upgrading your phone, and it isn’t likely to be prone to hacking.
Rakuten bank doesn’t have an OTP token as an option last time I checked, but they send one time passwords to your email instead.
What the OTP token is required for, and how it is used also vary between banks. For example, most banks just require you to press one button and generate the code which you enter – but JP Bank requires you to enter the transferree’s bank account number into the OTP in order to generate the token code. When registering a payee for PayPay bank, you can decide whether OTP will be required to make transfers to this payee in the future, but some banks will just always require the OTP code for any transfer.
Direct Debits
As mentioned above, direct debit can be set up to let money be withdrawn automatically by credit cards, utilities, etc. This is something that in general needs to be requested to the company in question, and they will forward you request your bank. Your Inkan (stanp) is typically required for the paper application form you must fill out.
Sometimes these forms can be filled out online, and after filling out the portion on the company’s site, they will often forward you to the bank’s site, where you will be required to log in, and probably enter your OTP.
Some banks, such as PayPay will let you see a list of currently authorized transfers, and cancel them from the site. Most banks, however don’t have this feature.
You can think of this as a “Pull” feature, as Tokyo Gas, Nuro Internet, Docomo Phone Service, etc., will initiate the transaction and “pull” the money from your account each month once you authorize them to do so.
You can also use your shopping debit card to set up payment for the comanies that support that – the main difference from a practical point of view is that shopping card transactions will show up on your online statement or passbook as something like “DEBIT 0234” instead of something more specific like “Tokyo Electric”. This will often incur a small fee, in contrast to using direct debit, which will usually be free.
If there is no money left in your account, there is typically no “insufficient balance fee” from the bank – the transfer simply doesn’t go through. Some companies will try the debit again at the end of the day, or the next day. Other companies won’t, and so you will need to then send them the money another way. Usually this will mean either manually transferring the money to an account they give you the information for, or using a card to deposit the money. (For example, if you have a Marui credit card, you can deposit money to pay off your balance using cash by using a Marui ATM at one of their department stores).
Not all companies will allow direct debit from all banks. For example, View Card will not allow you to set PayPay Bank as a direct debit source, but they will let you use MUFJ. This is unlikely to be an issue if you use one of the Megabanks.
Post Card Payments (Paper Invoices)
Many bills will show up in your mailbox as postcard type pieces of paper with a bar code until you set them up to be paid some other way (such as the direct debit mentioned above). These can include utility bills, credit card bills, tax bills, and more.
The typical way to pay these is to take them to the convenience store and pay in cash (or Nanaco electronic money) at the cash register.
There are apps and banks that will let you pay these paper invoices by scanning them with a smartphone app and deducting the money from your bank account – but often with a service fee.
Automated Transfers
Surprisingly, most banks don’t have “Push” features to automatically send money to other accounts. Some, such as PayPay do, but these may incur transfer fees. If this is important to you, you may want to have your pay deposited into the account with the automated transfer feature, and then this bank can send the funds elsewhere is required. Obviously, when pushing money, the amount needs to be determined beforehand, so this can’t really be used for things like utility bills which change every month. It can be used for things like rent, however.
Some companies will allow you to split your pay and have it split up and deposited into more than one account, but many don’t want to deal with the hassle. If your company supports it, this may be one option to fund multiple accounts. Also, some companies allow you to specify one account for standard payroll, and another for bonuses.
On the other hand, something that most banks do offer is automated import of money from other accounts on a regular basis. These typically don’t cost anything, but may be limited to once per month, and the timing is usually predetermined. For example, au Jibun Bank and PayPay bank offer the ability to transfer money from other banks on a regular basis, but this works something like this: The money appears from the source account just like any other debit, on the 27th of the month. The money appears in the destination account on the 4th of the following month. This type of transfer usually needs to be set up well ahead of time, and is intended for long term use, for example to move money to a account every month for savings purposes, etc.
Real Time Debits
Some accounts and services have the ability to be linked in such a way that they will immediately withdraw funds from your account for a specific purposes. A good example of this is that most banks have a related company that operates brokerage accounts, and it is typically possible to set things up so that you can transfer money from your bank account to the brokerage account in real time in order to invest. This feature is often called “Money Bridge” or similar. For example, Rakuten Bank and Rakuten Securities can be used in this fashion.
