The straight dope on getting a Japanese credit card

I was interested in this topic, but Googling it just led to a bunch of conflicting anecdotes, some from foreigners who couldn’t get credit and others from foreigners who could get lots of credit. Here’s what Wikipedia has to say about it in Japanese:

To get a credit card, one must first undergo a review by the card issuer. The standards for the review vary by card type and issuer, but essentially, the review is conducted based on the applicant’s “attributes” (occupation, income and credit history).

Generally, because it is mandatory for the applicant or their spouse to have confirmed regular income, it is difficult for unemployed people (excluding students and pensioners) to pass the review. On the other hand, in many cases, a person with real estate, investment, inheritance or gift income who is doing business with a financial institution, even if they are unemployed, can receive a card from an issuer within that insitution’s keiretsu.

In the past, “freeters” and dispatched employees (other than dependents) would not pass the employment and income review of many issuers because they were viewed as having uncertain employment, but due to the changes in working patters in recent years, this is currently less stringent than it was before.

Moreover, in cases of past lateness in credit card payments or periods of nonpayment due to debt restucturing (whether voluntary or through legal restructuring such as bankruptcy), a new credit card cannot generally be issued for the following five or ten years as a penalty, although this varies from case to case. This information is stored at a credit information institution in which the various card issuers participate, so if a person were to apply for a new card from another issuer, in many cases, they would be denied credit during that period. However, because the reviewer is given discretion (there are no laws or regulations on point), there are rare cases where a card is issued. Also, even credit cards which have been regularly paid may be stopped by the card issuer, but the handling of this varies among issuers.

Now, the anecdotes from foreigners in Japan suggest that:

  1. “Dedicated” credit card companies, like American Express and Saison, will issue a card to anyone, while issuers tied to banks, like Sumitomo Mitsui, are much more difficult to deal with (in part because their cards are much sexier).
  2. There are some foreigners who get credit cards on the day they land in Japan; there are others who live in Japan for years and can never pass a single credit review. Oddly enough, when they talk about this on the internet, they never speculate as to why this might be the case. (Maybe it’s because a NOVA salary barely pays the rent?)
  3. Being a permanent resident helps a lot.
  4. Being a lifetime employee (as opposed to working on a fixed-term contract) REALLY helps a lot.
  5. It is completely unnatural for a country to be this stingy about consumer credit. (Especially considering that in the US, a Doberman/newborn baby/ice sculpture can get a credit card in the mail without even applying for it.)

Personally, I’m amused and appalled that reputable American financial institutions have given me something like $10,000 in additional credit lines this year when I’m living off of student loans. But I’d like to know: do any of our loyal readers have experience with the Japanese credit review game?

13 thoughts on “The straight dope on getting a Japanese credit card”

  1. I opened a Citibank Japan account after I moved here, and they issued me a credit card without any problems.

    I seem to remember the minimum income requirements being around 3 million yen year, and the base card was for a line of 750,000 yen.

    I would ‘speculate’ I was issued one because I make more than the minimum, and I work for a multi-national. I guess this makes it look like I won’t suddenly leave Japan and leave them in the lurch..

    I’ve heard it is similar for people buying cars – you can get a fixed lease, providing you can provide a lot of associated documentation showing you’ll really be in Japan for X years.

  2. “It is completely unnatural for a country to be this stingy about consumer credit. (Especially considering that in the US, a Doberman/newborn baby/ice sculpture can get a credit card in the mail without even applying for it.)”

    Is it natural for a Doberman/newborn baby/ice sculpture to get a credit card without applying for it? What is “natural” when it comes to the extension of credit? As the international political economy and certainly that bit that pertains to credit adheres to a bunch of man-made rules is there anything “natural” about a large system of credit between borrowers and lenders that don’t know each other anyway? And if there are phenomenal savings rates in a given economy, then surely it is more “natural” not to encourage the accumulation of debt. The assertion that Japan and Japanese companies should organise their credit regulations according to the norms of the “west” just because a few foreigners see credit as a right seems to me to be a tad orientalist.

    Pardon my explosion.

  3. Back in the nineties I had a “Million Card” issued by Tokai Bank (now part of some bigger bank that I don’t remember) and when it came up for renewal they wouldn’t give me a new card because I missed a payment once.

    Credit cards in Japan are really more like Amex charge cards where they want you to pay off the balance every month or make a decision at the time of purchase as to how much you want to pay off.

    Gyms often demand you pay with their credit card – forcing you to take out a card you don’t want. At Tipness they actually told me foreigners get special treatment and can pay by direct debit from a bank because it’s difficult for them to get cards sometimes. Of course, Japanese customers are told that anything other than the Tipness card is impossible.

    It’s quite frankly a pain but I wonder how much of this has to do with the vibrant consumer credit industry here. It’s not totally impossible that they isn’t an agreement, written or otherwise, between the credit card companies and the consumer loan companies so that they don’t interfere on each other’s turf too much.

  4. That comment was actually tongue in cheek to begin with. Google the topic and you’ll find all sorts of message boards saying the same thing. It’s pretty hilarious.

  5. I’ve never tried to get a credit card in Japan, but I’ve had three different mobile phone contracts, and I was struck by how-unlike in the US-they have no credit requirements. You can get a normal contract to be paid in cash at the convenience store with nothing but proof of residence.

    When I got a cell phone the first time, from Sprint in the US in either 2000 or 2001, they ran a credit check and since I had absolutely no credit record at the time, I had to pay something like a $250 deposit, only refunded after one year of paying my bill on time.

  6. I had Citibank and JCB both with 25,000 USD limits. I was a full professor at the time and had a green card.

    Interesting note: IF you default on a Japanese card they DO pass on your bad credit to your offspring.

    Most disconcerting was: Citibank refused me credit in the US (you have to surrender your cards of you leave Japan) as they do not share INTERNATIONAL credit experience with their American counterparts. Having been away for many years I had to begin again with a $300 ore-paid limit card.

    Greetings from China where I have two unsecured cards with modest limits…


  7. There are several separate credit databases in Japan. A bank issuing a credit card can’t see what loans you have taken out with a non-bank such as a sarakin or shinpan. The mainstream financial system developed to channel individual savings to industry and so consumer lending got left behind. This is the enormous hole that sarakin filled with such success until their wings were recently clipped.

    Missing in the current economic recovery is a pick-up in consumption so while the answer probably isn’t to start issuing cards to dobermans, akita or chihuahuas, there is a greater role for credit than currently on offer. If the Grameen Bank can make productive loans to dirt-poor families in Bangladesh then low-income families in Japan could surely improve their lot with better access to credit. The prevailing view among regulators and legislators, though, is that people would just blow the money in pachinko parlours while leaving their babies to suffocate in cars outside.

  8. I just finished canceling my last Japanese credit cards. I was in a relatively high salary bracket and had been working in Japan for a couple years when I applied. Mitsui Sumitomo granted me a gold Visa and MC (even though they denied others I knew, like Gen, for no apparent reason). I acquired an Aplus Visa via a Tsutaya video rental card application (this card actually had a higher limit than the SMBC gold cards). Fujitsu supplied another one through their “Azby Club” when I bought a laptop from them. Three interesting points:
    1. After receiving so many cards, I started getting more applications for cards and loans sent to me in the mail, unsolicited, about one every month or so.
    2. The only credit card I was ever turned down for was a JUSCO card – and that was after creating a three year credit history with the other cards. I never could figure that one out.
    3. Mitsui Sumitomo issued me a “virtual card” with a small balance (100,000 yen) that was for net shopping only and was one of the only cards I could find in Japan with online fraud protection (luckily never had to test that out).

    If you really want a credit card in Japan, I suggest the Tsutaya Aplus Visa card. Aplus is based in Kansai for some reason, but they had the fullest and most reliable web services out of all the cards I tried. Even canceling my card was just done online (SMBC made me send in the actual cards and a lengthy application).

  9. Also, I wasn’t a permanent resident and worked on a yearly contract.

    In reply to TS’s comment above:
    > they want you to pay off the balance every month or make a decision
    > at the time of purchase as to how much you want to pay off.
    As I remember it, at the POP they ask if you want to pay it “ikkatsu” (one time payment) or as a “ribo” (revolving) payment (there was also a delayed payment option called “bonus barai,” but I’m not familiar with it at all). You set the amount you want to pay from your “revolving” total every month with your card company at time of contract, although you can change it later. A few years ago I noticed they started allowing you change your one time payments into revolving payments at any time online, presumably since this allows them to charge you more with the compounded interest. I never requested any revolving payments, but one thing about all the cards I had is that any overseas usage was automatically earmarked as revolving.

    One other thing I wanted to mention is that Visa and MasterCard were indispensable in Japan. JCB (the GF had one) had some nice perks and discounts at certain hotels and shops but wasn’t as widely usable. The only reason for me to consider Amex was that it was the only card usable at Costco (although this might have changed in the past year). My lifestyle wasn’t swank enough to even see places very often where Diners Card was accepted.

  10. I cancelled all of my US cards when I moved to Japan and, because they’re really not necessary in Japan for most things (hotels, cell phones, gyms, etc.), I went for a long time without one, which helped me in the long run, but kind of hurt in a broke patch.
    When I finally got around applying for one, it was solely to buy shoes over the Internet from the States (there’s still not a whole lot of selection here if you have relatively big feet) and, despite having been greatly inconvenienced by gross incompetence on the part of SMBC, and, thus having no money at all in an account I never bothered to close, I got an SMBC Visa with no problem. I would guess that being married and working for a university helped, but I can’t be sure.

    I noticed one, possibly causal, cycle not long ago: I subscribed to The Economist, which begat junk mail soliciting subscriptions to Forbes, Fortune, and other magazines I don’t want. Then I got a solicitation from Nikkei. Once my name crossed over into the Japanese mailing lists, I got a few credit card offers in the mail, all with terms and perks targeted towards someone with many times my annual income.

  11. I applied for a credit card in the early 90s. I was making 9 million yen a year at the time, but I was refused. (I was with Sakura Bank and I was applying for Visa.)

    The reason is fairly clear: When they asked me for the name of Japanese-speaking person who could help me communicate with them, I told them (in Japanese, of course) that I could speak Japanese. Needless to say this was a weaselly way of asking me for a “guarantor” of some sort but I felt kind of ornery and didn’t swallow their dishonestly-worded bait.

    I later rang the credit-card company and spoke to a man on the phone. He basically told me I should have got the card, but that they had policies relating to “gaijin”. He also said that he’d told me too much and wouldn’t tell me his name.

    Had I asked my company to sponsor me I’m sure I would have got the card, but I didn’t feel like jumping through those hoops — you know, Western individualism and all that. In those days it still wasn’t vital to have a credit card so I didn’t care so much about not being given one. But the episode rankles to this day and still colours how I view Japan, a country I lived in for 16 years. In fact, if I were offered a Japanese credit card I would probably turn it down on grounds of past discrimination. I have a long memory.

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