TOPTokyo LifeWhy Is It So Hard for Foreigners in Tokyo to Get a Credit Card?

Why Is It So Hard for Foreigners in Tokyo to Get a Credit Card?

By Louise George Kittaka

Japan still mostly runs on cash, but why is it so complicated for foreigners to get their hands on a Visa or MasterCard here?

It’s a familiar topic on online forums for foreign nationals in Japan: What does it take to get a credit card here? While it’s hard to find a definitive answer to this perennial question, I recently did a bit of digging to try and at least offer a few insights into the issue.

I began my research by calling up a few banks and credit card companies and speaking to their PR departments. However, while everyone I spoke to listened politely to my spiel, nobody wanted to be interviewed for an article in the English media. Undeterred, I then contacted the helpline numbers for several different credit cards on the pretext that I was “calling on behalf of a foreign friend who didn’t speak Japanese.”

My “friend” has been in Japan a few months and, while gainfully employed, she has already been turned down for several credit cards. My “friend” and I were wondering if there was anything foreign nationals needed to know about the application process that could improve her chances?

Everyone thanked me and my “friend” for our interest in their credit card but they reiterated that each application was judged on its own merits, so all one could do was “apply and see.” One company did say that they make an evaluation (shinsa) based on a number of criteria. In the case of a foreign national, these may include residency status, income, and Japanese language skills (if a person doesn’t read or understand enough of the conditions of the application, it could be a basis for rejection).

Next, I talked with Katherine Nozaki from Asian Tigers Mobility. In her role as a relocation consultant working with transferees, Katherine handles everything from helping clients find an apartment to setting up banking and mobile phone services. However, she says that the seemingly straightforward procedure of obtaining a credit card in Japan can leave even the experts stumped when it comes to foreigners.

“There is a lot of conflicting information. Many credit card companies simply refuse applications from foreigners. For other companies, it seems to depend greatly on the individual you deal with,” Katherine explains. “Recently, one institution we approached ruled out the possibility of applying unless the applicant could understand written Japanese. However, in the past, other applications at that same company by individuals without any Japanese language ability have been approved.”

While there is no guarantee, Katherine and her team suggest trying the following credit cards for foreign nationals: AMEX, ANA, Costco Orico, Costco AMEX, JAL Card, Prestia, Shinsei and Rakuten. As an alternative to a standard credit card, she notes that a Visa-debit card, such as those issued by Mitsubishi Tokyo UFJ and Risona Bank, are also currently worth trying.

Finally, I chatted with a financial expert who has experience in the credit card sector. He was willing to comment but requested that his name not be used. “Given that the foreign population in Japan remains relatively small, most lenders have not found it necessary to modify their underwriting criteria. And one of the key criteria for that is Japanese-based income from Japan-based employers. Traditionally, even self-employed Japanese found securing credit much more difficult and were only served by the ‘non-banks’,” he points out. “If that has remained the case, I assume that foreigners seeking to get Japan-issued credit cards might find it challenging if they have little credit history in Japan and/or do not have a Japanese employment record.”

Bearing this in mind, he suggests that it is not necessarily an anti-foreigner mindset that makes it difficult for foreign nationals to obtain credit cards. “If the Abe administration is successful at increasing professional immigration, over time perhaps the banking establishment will see a sizeable unmet need and expand that criteria. In the meantime, I expect them to be carefully vague on the topic as specificity is not good publicity in this case.”

Thank you to taxation consultant Calvin Tong for assistance with background information for this article.