Sunday, July 15, 2007

Getting a Japanese Credit Card

The doorbell rang today (Sunday) and a postman was standing in his rain suit with a registered letter. The last time I got a registered letter in Japan, it was from the local ward office demanding I cough up my delinquent health insurance payment or they'd go to my company and tell on me. This wasn't much of a threat because I'd quit my job about a year ago at that time but I paid anyway and now they love me again.

I wasn't exactly pleased to see another registered letter and wondered who was going to threaten to run off and tell my mommy on me this time, especially since I'm not behind in any payments now. Fortunately, it was just the bank sending me a new credit card to replace the one which is at this very moment approaching complete obsolescence. I believe this is my third renewal since getting a Japanese card and all I remember is that the first one was really nice-looking with a grey and black representation of Botticelli's Birth of Venus on it. The re-issued one looked pretty much like the one above, blue and boring.

If you read forums or blogs, you find a lot of hostility when it comes to foreigners (not) getting cards issued by Japanese banks. A lot of this is justified because it is difficult to get a card if you're not Japanese. The banks are afraid you'll spend to your maximum credit limit and blow the country so they don't want to issue cards to people who have been here a short time or haven't shown job stability. In my case, I was able to get a card after working at my company for about 5 years. My company asked me if I wanted a card (I didn't request one) and did all the paperwork for me. It surprised me that it was so simple given all I'd heard.

If you read forums frequented by foreigners, you get a lot of misinformation about what you have to do to qualify for a card. I've heard people say you have to be able to read the fine print, which is written in Japanese, and therefore you can only get a card if you are fluent. This is simply not true. I never read the agreement nor even had it translated for me by someone else. It's also sometimes said that you must have an official hanko (personal ink stamp seal) to get one and this is also not true.

These days, it's probably easier to use a shop which really wants to issue cards to help you get a card. Costco in Japan, for example, is more than happy to sign you up and they're very gaijin-friendly. It's also easier to get the sort of cards that charge an annual fee (like Master Card) than the free ones. The truth is that Japanese financial institutions aren't stuffing credit cards into people's hands like candy into a child's Halloween bag like they are in the U.S. They're a bit more wary, particularly with people who are potentially a bad risk because they have no incentive to be responsible for their debts, and frankly, a lot of short-term visitors lack such an incentive. It's not too much to ask that people show some sort of commitment to their life here (staying more than a year) and the ability to pay off their debts (by having a steady job) before handing them a card.

If you really want a card, I suggest having your visa sponsor apply on your behalf just after they renew your second contract. Most accountants in companies are willing to lend a hand though you may be out of luck if you work for a monolithic fast food school that doesn't offer any sort of support to its employees (such as Nova).

Some people might wonder why someone who resides in Japan must have a Japanese card when a card from any country is just as usable at shops or for on-line purchases. The main reason they're good to have is that it saves you charges for (two) currency exchanges. If my husband and I use our U.S. card, we have to transfer yen to dollars to put money in our U.S. bank account to cover the charge. This is a time-consuming and expensive process which we prefer to do with great infrequency. Additionally, we lose money on the exchange since the true rate is not charged when doing a currency exchange (if it's ¥123 to the dollar, we'll probably pay ¥125 to the dollar). If the purchases are made in Japan, the disadvantageous exchange rate is applied twice. Essentially, we buy in yen, it's converted to U.S. dollars when charged to a U.S. card and it's paid in dollars which were converted from yen. In the long run, having a Japanese card can save you a tidy bit of change.


Alli-san said...

I had a weird experience with this. It was a lot more difficult for me to get my first card (w/Mizuho) and I went in with my employer. I went in recently to get an International Card to have access to my yen while in the States. The woman behind the counter didn't speak any English at all, but we fumbled through with my crappy Japanese, I stamped my hanko, and one week later the card showed up at my door. No one asked for proof that I would be coming back to the country (i.e. employment) They did ask for a reference in the country, but never contacted the reference that I gave them. This could all be because I already had a cash and credit card with the bank though. Plus the IC functions like a debit card and I don't think there is a credit option, so I guess there is no risk of me spending a bunch of money and never paying the bills.

Shari said...

Hi, Alli, and thanks for your comment. :-) It's always interesting to hear about other people's experiences in the same situations.

I think that having the first card made the second one much, much easier and your employer smoothed the way on the first one. I'm not sure but it could be that the presence of a Japanese person who will vouch for you creates confidence in your character. If so, this wouldn't be too surprising since relationships between businesspeople are so important and it's not unheard of for formal introductions between connections to carry more weight in Japan than in western culture.