Paypal Currency Convertion Rates

[Koa Zo]

Has anyone else noticed that when paying for international items on eBay, the Paypal currency conversion rate is always tilted to overcharge in Paypal's favor.

On the eBay site there will be an estimate (in US dollars for me) posted beneath the listed auction price. In my recent purchase the item was in GBP. The actual Paypal conversion is always more costly than the estimate posted on eBay.

Today I paid for a UK item which came to 46.00 GBP, that should convert to ~$75.20 USD, yet Paypal charged me $77.45.
Of course Paypal then charges the seller an addition fee for currency conversion as well.

Are these fees and rates disclosed and detailed anywhere in the Paypal user agreement?

edit:
I just called paypal and was informed that buyers pay an additional 2.9% plus $0.30 for currency conversion.
I asked where this information is detailed on the website and the operator said he did not know but would find out for me. After being on hold for a number of minutes, he reported that he could not find that information but he would read off a list of fees. Everything he read to me involved accepting credit cards as a seller - so no help or explanation at all regarding international currency conversion.

The long and the short of this is that Paypal is charging both the buyer and the seller addition fees to do currency conversion. Yes these fees are not clearly detailed for the buyer.

[RegalSin]

Paypal, is sappose to work like a Money Order, which in essential is a credit card, or better yet a Check. However paypal + ebay charges the seller the Money Order Fee + Ebay listing, which is sappose to cover all taxes. In general ebay is = to garage selling.

However in congress, big sellers, like anybody you can think of ( SEARS, JCpenny, and even small business owners ) all have the problem with the fact, an person garage selling on the internet is not breaking in the taxes ( like in my state it was 8.5 cents per each dollar, but now it has risen even higher ). Basically with used goods, like the ones we have, their is no reason to tax anything.

In general, paypal, is charging a fee for the conversion. If you want to dodge this, you need to convert your money in another country, and make a bank in another country and open a paypal account their.


Another thing you can do is store your paypal in another currency, which will not make a difference because paypal.

The way I see it, is that paypal is no differnt then ordering through a service that charges for bank transfer fee. Like every $5 per 10 dollar item, or even every $10 per each $100 dollar item. So between those differences you should not care.

Another thing to think about is how everybody is spending their money in USD. Meaning you might have a conversion fee, but the money being converted is all USD, and if you have been reading the
"Princes" Money news, you can see that every-bodies, taking a dive thanks to the spending of USD.


While you do buy from international sellers, you also have to consider, where you money is going and how it affects you in the long run. You might not think about it, but it affects everybody. Try spending enough money fast enough, and making random deposits outside your payday. I am not saying all in one day but a period of time.

Recently two men took a photo on facebook, with them holding wads of cash, in their car. Because of that picture, somebody decided to do an investigation on them, which lead to them being founded as credit card fraud, the paper also reported a related killing, of somebody in the ring.
A woman had an extra high electric bill, and they decided to do a sting on her, which lead to the discovery of her "plants' she was growing.

That is why you need to fight for your privacy, and avoid giving information like your utility bill account number, and things like that, to the wrong people. Even banks will do investigations, if they do not like the flow of money, or if you do not store enough money in them. What is worst, is when somebody starts looking at your account, and starts counting numbers on the bill. They numbers on the bills do matter.

[trap15]

[Friendly]

Every single post by RegalSin comes off as being written by a borderline illiterate crazy person. Maybe it's a clever joke?

[HydrogLox]

Has anyone else noticed that when paying for international items on eBay, the Paypal currency conversion rate is always tilted to overcharge in Paypal's favor.

Yes, immediately the first time I was about to make a transaction in a foreign currency. Because of this I always use a CC as a funding source and I ensure that the CC is charged in the seller's currency - i.e. the CC company does the currency conversion for me - not Paypal.

[ApolloBoy]

Every single post by RegalSin comes off as being written by a borderline illiterate crazy person. Maybe it's a clever joke?

Judging by his history, he really is that crazy.

[moh]

Try spending enough money fast enough, and making random deposits outside your payday. I am not saying all in one day but a period of time.

Recently two men took a photo on facebook, with them holding wads of cash, in their car. Because of that picture, somebody decided to do an investigation on them, which lead to them being founded as credit card fraud, the paper also reported a related killing, of somebody in the ring.
.

what just happened between these two statements

[Teufel_in_Blau]

I think I get what RegalSin is trying to say. I also have the same problem sometimes. I try to keep my sentences short to avoid making mistakes in English and the result is a lack of transitions between two statements.

It happens.

[BIL]

Dear God. It's taken control of that dormant account and is attempting to manifest itself in our plane of reality. If it discovers the zero poster backlog we'll be annihilated in a fortnight!

[Ed Oscuro]

I don't want to egg anybody on, but I ran across a post on another board (entirely by coincidence, was trying to do some research on the Xbox thermal paste) asking "is there a Babelfish translator for RegalSin?"

Apparently he is quite famous indeed.

[Ganelon]

Charging a currency conversion fee and hiding it within the conversion rate (e.g. PayPal, proxy services) or within service charges (e.g. banks, credit cards) is the norm nowadays. Although it's a hassle, if you want to save money, then you need to factor in all these factors to make sure you're getting the best overall conversion rate.

I agree it's important that everyone is aware of these not-so-transparent charges. For most buyers, you should *NEVER* use PayPal's currency conversion. First, you're stuck paying the additional conversion rate, which is usually slightly less favorable than the 3% conversion fee a typical credit card charges and much less favorable than a typical bank conversion rate.

But second, for credit card users, PayPal will also forward the seller's country of origin to your credit card—thus making the purchase a foreign transaction—instead of assuming the charge internally (since PayPal is a US company and many of us are in the US). Unless you're not using a credit card or using one that doesn't charge foreign transaction fees (e.g. Capital One for now), you'll get docked an additional ~3% foreign transaction charge on top of the conversion fee PayPal already charged.

Moreover, this country of origin does *NOT* correlate with the PayPal line item address listed on your credit card statement. Even if a Japanese store has a US location as the primary address listed on the PayPal line item, PayPal will actually screw you over and still tell your bank that it's a foreign transaction. Therefore, many credit card users with PayPal are actually paying a ~6% fee when you use PayPal's conversion.

In other words, using PayPal's currency conversion (which already has a fee hidden in the conversion rate) doesn't replace your credit card's currency conversion fee. It also appears as if PayPal is deliberately allying with banks to take your money in an underhanded and possibly illegal manner. By "possibly illegal," I mean that PayPal is mislabeling transactions as foreign because of currency conversion involved even when the other company has a US office that the payment is supposed to be sent to. Go check your credit card statements yourselves and see.

[GaijinPunch]

Charging a currency conversion fee and hiding it within the conversion rate (e.g. PayPal, proxy services) or within service charges (e.g. banks, credit cards) is the norm nowadays. Although it's a hassle, if you want to save money, then you need to factor in all these factors to make sure you're getting the best overall conversion rate.

All banks do it basically. The rate PP gives is at least as good as what you'd get in a bank in Japan, walking in and getting cash converted. It's better than most US banks I've seen (lol) and way better than some airports I've been in (Hawaii's is laughably horrible... borderline criminal).

A handful of Japanese banks (the foreign currency friendly ones, anyway) start off with decent rates, and some get good if you keep a load of dough in there.

[Skykid]

Charging a currency conversion fee and hiding it within the conversion rate (e.g. PayPal, proxy services) or within service charges (e.g. banks, credit cards) is the norm nowadays. Although it's a hassle, if you want to save money, then you need to factor in all these factors to make sure you're getting the best overall conversion rate.

All banks do it basically.

Yes, and this is the rub: Paypal aren't a bank. They skirt the lines of legality (and probably pay certain authorities to turn a blind eye) so they don't pay the same level of taxes - but the operation is about as close to banking as you can get.

Paypal/eBay are completely corrupt. Paypal freeze accounts under false pretense regularly under their 'terms of investigation'. Funds in frozen accounts may not be available for up to 6 months legally, based on their T&C's, after which point they will either reinstate your account, or close it and send the money to your bank account.

These freezes tend to occur regularly on accounts with large sums of money in there, so Paypal can then invest your funds as capital and earn interest on it for 1- 6 months. Imagine doing that with a million accounts and the interest adds up. Of course, this is a loophole: it's acting like a bank without being a bank - but while finds are frozen they're available for investment behind the scenes.

As for exchange rates, they've always been miles different to actual rates (versus XE etc) and the fees are designed to skim every possible penny.

If there were another way, I'd use it.

[GaijinPunch]

Yes, and this is the rub: Paypal aren't a bank. They skirt the lines of legality (and probably pay certain authorities to turn a blind eye) so they don't pay the same level of taxes - but the operation is about as close to banking as you can get.

But they aren't charging as much as a lot of banks for this particular operation. I know they aren't a bank, but in this particular case, they're actually not as bad as a bank. Better even considering they kind of have you by the balls when you buy from abroad.

Not denying any of the other shit. I just don't think it applies here.

As for exchange rates, they've always been miles different to actual rates (versus XE etc) and the fees are designed to skim every possible penny.

There actually is some type of transfer of assets going on (at some level) that PP has to do. They're registered as businesses in every country they reside. As such, they can't just magically do FX, although they probably have enough of everything that they could for some period of time, and if they ever had to do an FX trade, it would be for fractions of pennies. However, again, this is kind of standard practice for any business that changes money.

In short: someone has your money; they will charge you fees for just about everything. Look at the ATM (Automatic Teller Machine, not the other one) fees in the US.

If there were another way, I'd use it.

Everyone would, and it will never cum.

[RegalSin]

Their are other services outside of paypal, not including the failed Google service, but a couple of other services, are offered out their. The problem is that so many people will only take paypal.

Yeah, that language..............................since I was eleven.

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About paypal, they hold your money in multiple banks, it is good for them and good for the nation as whole. Meaning the money in a paypal account, is bouncing around.

Paypal had offer money market, accounts, which means they invest with your money, and you gain a small amount of money back. They had stop this because not too many people were investing. You can find the article by doing a search, but it should show paypal delivered on their promise, with the money market accounts.

I will agree, ebay is part of curruption, when you have big business like Costco, macy, and others taking part, complaing about tax and garage sellers being compared to full time business. Law wise is concerned Yahoo are an even bigger threat to the world. Otherwise paypal has been a decent service in the past, and present.

Because many people are using paypal, over money orders, money orders are now more expensive.

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[Dave_K.]

These freezes tend to occur regularly on accounts with large sums of money in there, so Paypal can then invest your funds as capital and earn interest on it for 1- 6 months. Imagine doing that with a million accounts and the interest adds up. Of course, this is a loophole: it's acting like a bank without being a bank - but while finds are frozen they're available for investment behind the scenes.

I'm all for PayPal bashing, but spreading fud like this gets tiresome. It's illegal for PayPal to make any interest off funds being held, so of course they can't do this. Its strictly for fraud reasons why money is held. You only hear about it so often from people using PayPal because as you said they act like a bank but actually are not.

[cools]

GP is right. PayPal's conversion rates beat out both the bank and credit cards in every single transaction I've checked.

It annoys me no end that its cheaper to send a big PP payment converted to a different currency using a credit card than it is to send it directly from the same card, and same goes for a bank transfer.

[Ganelon]

Did you test both methods in actual purchases and compare the results? In case my earlier statements weren't clear, my findings after trying this experiment years back (CC from a major US bank) were:

Paying by CC results in getting charged the true market currency conversion rate plus a separate foreign transaction fee (for the CC).

Paying by PayPal with CC results in getting charged an inflated/fee-included currency conversion rate (for PayPal) plus a separate foreign transaction fee (for the CC).

Now, that's in the US. So either PayPal is screwing me, you missed the separate foreign transaction fee using PayPal, or EU policies prohibit PayPal from telling the CC that these are foreign transactions as it does in the US.