Paypal Currency Exchange Rates - a tip for traders.

[Daags]

People,
as some of you may already realise ... paypal charge an extortionate rate for currency exchange.
For example, my native currency is euro - and if I were to pay for something that cost £400 paypal would currently charge me 517 euro, while the going rate according to xe.com/google currency etc is 498.88 - 498.98

approximately a 20 euro difference. ouch. that could pay, or cover most of, the shipping costs throughout europe at least.


anyway, if you don't know already - Paypal allows you to add and manage many different currencies in your account. For example, I have euro - dollar - gbp currencies in my paypal account. That means, if I receive dollars, or gbp ... paypal doesn't convert the money - it stores it in my account as it is. Your account needs to already be setup for this currency first though, otherwise paypal will convert it - and f**k you on charges.

so, this may be no good to you if you have to convert the money anyway - but you can also just leave the money in your paypal account, and the next time you are buying something in GBP for example, you can just spend the GBP that is already sitting in your account...no currency exchange. Or you may wish to wait and see if the exchange rates improve in your favour before you convert, though paypal will still be f**king you comparitively speaking.


another handy feature of the managing currencies page, is you can see the 'true cost' of paying for something in a foreign currency... i.e getting the number paypal will charge you. there's a calculator to the right of that page which allows you to calculate based on receiving or payment.

to access these features log in to your paypal account and go to:
wallet - paypal balance - manage currencies


hope that helps some of you.

[4tune]

Thanks for the tips Daags,


some useful info there.

[sprnva]

Also, if you're sending money from an attached credit/debit card you can forego the conversion to your native currency and have Paypal charge the actual currency to your card. Then your bank will charge you it's own exchange rate, which is usually lower.

So if you're buying something for, say £400, Paypal will charge your card for £400 and your bank will then charge you whatever that comes to with it's own exchange rate.

[Daags]

Also, if you're sending money from an attached credit/debit card you can forego the conversion to your native currency and have Paypal charge the actual currency to your card. Then your bank will charge you it's own exchange rate, which is usually lower.

So if you're buying something for, say £400, Paypal will charge your card for £400 and your bank will then charge you whatever that comes to with it's own exchange rate.

yes, indeed. I do this especially when buying from amazon.co.uk ...

and I use this visa exchange rate calculator to get an accurate conversion rate before I purchase.
(you do need to know what percent your bank charges for the currency exchange. I think 2% might be typical ?)

https://www.visaeurope.com/making-payme ... ange-rates

[fmr]

When dealing with exchange rates there are usually two values:

If the bank is selling you foreign currency (exchanging your own money for foreign currency, like GBP or USD), they charge it at a higher rate in your native currency, which means you pay more to get the amount of foreign currency you need).

If the bank is buying foreign currency from you (exchanging foreign currency for your native currency) they convert it at a lower rate (which means you receive a lower amount in your native currency).

Adding to this, you must pay taxes on the transaction. So, the exchange rates you get in xe.com must be seen as merely informative. Paypal is earning money with the conversion rates, yes, but also do the banks (any bank). So, be careful when you choose to make the exchange in your own bank, because you may loose even more (or not).

[Numanoid]

anyway, if you don't know already - Paypal allows you to add and manage many different currencies in your account. For example, I have euro - dollar - gbp currencies in my paypal account. That means, if I receive dollars, or gbp ... paypal doesn't convert the money.

So what is good about that?

I had €30 in my account, and was selling something to raise another €20, and to be nice I let somebody pay me in dollar instead of Euro, so I thought I had amazed something like €50, so I could buy something that cost €40

But no then I couldn't buy it with the paypal balance, it got charged to my credit card instead

The reason, even though I had enough money, it was not the same currency put together

This is some of the most annoying things with paypal, if I got €78 in my account, and want to buy something that cost €80, I can't €2 from my credit card, to add up to the amount, I got to pay the whole sum with my credit card

[Daags]

you can change the dollars to euro manually, any time you wish. as I said ...

[sprnva]

This is some of the most annoying things with paypal, if I got €78 in my account, and want to buy something that cost €80, I can't €2 from my credit card, to add up to the amount, I got to pay the whole sum with my credit card

That doesn't sound right. I've paid for items where Paypal took whatever I had in my balance in that currency and then charged the remainder to my card.

As for exchange rates, I've found that I generally come out saving money getting my bank to do the currency exchange rather than Paypal. Unless it's for small amounts (say €10 or so) as I think my bank has a fixed charge on top of the usual exchange rates.

[Daags]

This is some of the most annoying things with paypal, if I got €78 in my account, and want to buy something that cost €80, I can't €2 from my credit card, to add up to the amount, I got to pay the whole sum with my credit card

That doesn't sound right. I've paid for items where Paypal took whatever I had in my balance in that currency and then charged the remainder to my card.

if i haven't misunderstood him, he's saying that he has, say, 30euro (in euros) ...and then accepts approx 20 euro (in dollars), which stays in his account as dollars - but he thought that he could buy something worth 50 euro and that it would all come out of his paypal account....whereas what happened was the 30 euro came from his account, and the balance was charged to his card.

as i told him though, he could have manually converted his dollar balance to euros first.

[Numanoid]

as i told him though, he could have manually converted his dollar balance to euros first.

That's the whole point, what's the use of accepting more currencies, if I want to buy something, the total I pay has to be in the same currency, and then I'm left losing out to paypal's crappy exchange rate anyhow, and also waste time doing the actual conversion

[Daags]

as i told him though, he could have manually converted his dollar balance to euros first.

That's the whole point, what's the use of accepting more currencies, if I want to buy something, it has to be in the same currency, and then I'm left losing out to paypal's crappy exchange rate anyhow, and also waste time doing the actual conversion

well ... the topic does say 'a tip for traders' ... maybe you're not a trader, have you considered that ? i buy and sell frequently enough that i'm dealing with three major currencies, and before i cottoned on to it I was getting charged for currency exchanges multiple times unneccessarily...rather than simply letting the currency sit in my account until i needed to spend that same currency at another time.

for me, manual control over currencies in my paypal account is well worth the 'effort'.

[Numanoid]

I trade a bit too, but I do not let money accumulate in the account, I buy new stuff I want, so I'm always out of pocket.

So my tip to myself is to keep my earnings in the same currency from the get go, it is easist that way

BTW:

If starting with €10, then convert to USD, back to Euro, to USD, back to Euro, etc

How many conversions have to be done before paypal have taken the whole amount?

[Daags]

...it is easist that way

and depending on the sums of money involved, you'll pay through the nose for that convenience as opposed to just consciously managing your currency conversions.


dealing with 10 euro, i don't know how many times you would need to bounce back and forth ... lots ?

buying and selling hardware, even one paypal currency conversion is too much as far as I'm concerned and it pays to manage your currencies manually.... and/or let your bank handle the conversion like sprnva said, when needs be.

[Numanoid]

...it is easist that way

and depending on the sums of money involved, you'll pay through the nose for that convenience as opposed to just consciously managing your currency conversions.

As I usually don't have to pay VAT, I get some extra mileage because of that