Debit cards have become more and more common in Japan in the last decade. In this article we will tell you about some of the advantages and disadvantages of debit cards in general, as well as some best practices when using them.

Advantages of debit cards

Unlike credit cards which bill you for payments at a later date, debit card payments are debited directly from your savings account at the time of purchase.

Easy to manage funds
With debit cards you can only spend within your personalized usage limits and up to the available balance of your bank account. This saves you from spending too much and using money you don't have; two things that easily happens when using a credit card. You can also set your own monthly and daily limits. Your transaction history is recorded to you and can see at a glance how and when you used your debit card, which is ideal for tracking your expenses.
Save with points and cashback
Some debit cards allow you to earn points or cashback. This allows you save more than if you were to pay in cash. In addition, debit cards integrated with cash cards can offer attractive benefits such as a high number of fee-waived ATM transactions per month.
Easy to use outside Japan
Like credit cards, debit cards linked to major international brands like Visa and JCB can be used for shopping outside Japan at any member merchants. Being able to withdraw local currency from ATMs outside Japan is another advantage of debit cards. However, please note that J-Debit, a debit card specific to Japan, cannot be used outside Japan.
Cashless experience
With a debit card, you can enjoy shopping and dining out, while lowering risk of having cash stolen. In addition, you won’t need to search for coins at the cash register, making payments smarter and faster.

Disadvantages of debit cards

Although debit cards can be very convenient, there are also a few things to keep in mind.

Purchases must be paid upfront
Since debit cards are instant payments that are debited at the time of purchase, you will need to make the full payment upfront, unlike credit cards, which allow you to pay in instalments and revolving payments.
No cash advance
Debit cards do not have a cash advance function like credit cards. Debit cards limit how much you can spend based on your available account balance. Therefore, you cannot borrow funds using cash advance (also known as card loan) services.
Not able to be used at some merchants
Some merchants, such as highways toll booths and many gas stations, do not accept debit cards as a payment method. Since debit cards cannot be used to pay for highway tolls, it is not possible to set up automatic payments using an ETC card like you can do with a credit card.

Who should use debit cards?

Debit cards are recommended for those who:

Don’t want to go into debt
Since debit card payments are debited from your bank account on the spot, unlike credit cards which require the payments at a later date, they are good for to those who want the convenience of card payment, without accumulating debt.
Want to manage their funds smartly
Debit cards make it easy for you to manage your funds by preventing overspending, since they can only be used based on the available balance in your account. Debit cards allow you to check your transaction history using your computer, smartphone or app, and are perfect for those who want to control their expenses.
Non-Japanese residents new to Japan
One of the major frustrations of non-Japanese residents in Japan is the difficulty they face in getting a credit card, often being rejected by multiple credit card companies. As long as you meet the account opening requirements of your bank of choice, foreign residents can open a bank account and get a debit card.

Precautions when using debit cards

There are two points you should keep in mind when using debit cards.

Beware of an insufficient balance
Debit cards cannot be used if the balance in your bank account is insufficient. Since funds will be debited from your account when you use the card, you will not be able to make purchases that exceed your balance. It is a good idea to check your balance before shopping, especially if you are planning on making a big purchase.
International brands may be mistaken for J-Debit
International brand debit cards such as Visa and JCB can be used outside Japan, but the Japan-specific J-Debit can only be used inside Japan at merchants that accept J-Debit.
If you tell the merchants, "I’d like to pay by debit card", they may mistake your card for J-Debit even though you have presented your Visa Debit card. It’s better to tell the merchant clerk you’d like to pay by Visa or JCB instead of debit card. If you are asked about the number of payments, answer “once”.

Sony Bank WALLET

Sony Bank’s debit card, Sony Bank WALLET, may be the right option for non-Japanese residents looking for a convenient debit card. Sony Bank WALLET combines Visa debit functionality with a Sony Bank cash card.

Features of Sony Bank WALLET

As debit card:

  • Enjoy shopping at Visa merchants worldwide
  • Built-in Visa Contactless Payments
  • Withdraw local currency from ATMs outside Japan
  • In addition to Yen deposits, accounts can be linked to Foreign currency deposits in 10 currencies and allow you to tap into your accumulated foreign currency savings
  • Earn between 0.5% and 2.0% cashback on purchases inside Japan

As cash card:

Sony Bank WALLET can be used at over 9,000 partner ATMs in Japan such as at convenience stores

Sony Bank WALLET has no annual fees or issue fees. If you do not have an account with Sony Bank, you can apply for the card during the account opening process. If you apply via the English Open Account app, you will receive a Sony Bank WALLET card automatically.
Also, if you already have an account with Sony Bank, you can switch from a normal cash card to Sony Bank WALLET for free (application via Japanese language website only).

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