PayPal - Currency Conversion - What a joke!

I recently received a very large sum in GBP from Sedo and PayPal converted it to AUD, they converted it at the following rate:

PayPal Exchange rate:
1 British Pound = 2.01944 Australian Dollars



Google says:
1 British pound = 2.08250445 Australian dollars


I checked the the xe.com rate when it was completed and it said:
1 British Pound = 2.06175 Australian Dollars



There's quite a difference and when it involves a large sum of money it adds up, do you think this is ridiculous is am I being stupid?

 

Currency Conversion Disclaimer

Google cannot guarantee the accuracy of the exchange rates used by the calculator. You should confirm current rates before making any transactions that could be affected by changes in the exchange rates. Foreign currency rates provided by Citibank N.A. and displayed under license. Rates are for information purposes only and are subject to change without notice. Rates for actual transactions may vary, and Citibank is not offering to enter into any transaction at any rate displayed.

 

Well we have same problems when we transfer cash to banks and we are getting 1.50 Rs less then normal rates. We lost $35 to $40 per $1000 Withdrawal. But we can't do anything on it.

 

Paypal does their rate by the average of banks around the world. you can find it in their TOS.

Also remember they charge 2.5% to do currency exchange

 

I think that it is not totally true, the 2.5% commission is applied when you receive a payment in a currency for which you don't maintain a balance in your paypal account. For example you receive CA$ and you accept this payment but directly converted in US$. On the other hand if accepting the payment in CA$ and changing it in US$ then the commission is higher, or at least the exchange rate is different, so you finally pay them a higher fee.

The best way is to only deal in your local currency. And open and close foreign currency balances accodring to your needs. Be aware that if you've several pending payments in one currency and that you open a balance in this currency paypal will automatically accept all pending payments.

Also at least for european users, be patient as the UE commission is currently taking a closer look inside this, as these are clearly hidden charges. Paypal acting in virtual money these foreign exchange commissions makes no sense.

 

Paypal calculate by their own rate which is always less than real exchange rate.

 

No one will pay the xe.com rate. It cost institutions money to exchange so there will always be a surcharge, albeit PayPal isn't known for great exchange rates.

 

Hate to say it but Paypal is not your friend on international exchange rates, and they are never going to be. They use their own calculations and take a percentage of the transfer. If possible, get the money out in the original currency and use a bank to switch it to local funds. Obviously this means using Paypal won't often work for you.

 

Its a problem with that. Most banks charge 8% for the exchange and paypal only charges 2.5%.

Yeah by going through the bank you get a better exchange rate but the fee for it is higher than paypal so you will wind up paying more at the bank.

 

I have lost so much through their "commission" and I couldn't come to grips why one has to lose that much. You're not alone.

 

Yeah, that stinks.. I have lost some money due to conversions...

 

Unfortunately there isn't much one can do. They do as they want... Always will. Your in the right to complain though because when it is large sums, it does add up.

 

XE does not offer the official exchange rates and it is merely just for the purpose for information.

If you do not know, currency exchanges is a product of supply and demand and can vary vastly from bank to bank or even in country to country. You would get a different rate if you change the money in the US as compared to doing the same conversion in the UK.

Besides, in order to protect against the volatile currency exchanges, Paypal did explicitly mentioned that they will tag on the 2.5% foreign exchange fees as long as you are exchanging outside of your base currency or the US Dollar. It is not like they hidden that fact.

In fact if you ever used a credit card to purchase from outside your home currency or withdraw from a foreign ATM machine, you would realized that there is about 2 to 3% foreign exchange fees which is tagged on to the transaction.

 

Yeah I've made that mistake once and lost some money.

I don't think I'll convert money using their system anymore.

 

There crooks when it comes to this, from my understanding the Canadian dollar is more then the US dollar but according to PayPal the US dollar is worth more then the Canadian.

By the way PayPal acts and by the way there business is run you could almost think that it is being run by a child.

One day it will all catch up to them when one person decides to look into it further and find a loop hole but until that day we all are going to have to keep getting ripped off.

Just My Thoughts!

 

I know the Canadian Dollar is less than the US Dollars but they are very closely par now. Why can't you read Paypal's website as they clearly state that there is a 2.5% foreign exchange fees and as such would tip the US$ to be less than the Canadian Dollar.

I am not sure how it is in Canada but here in Singapore if you use a credit card and makes an overseas purchase, the bank would tag on a 3% foreign exchange fees which makes paying in cash a lot better.

Once and for all, I hope that you guys really don't play the ignorant game and actually read the Paypal website at https://www.paypal.com/us/cgi-bin/webscr?cmd=_display-fees-outside

 

wa, never take on look on this part

 

Next time, make sure you read all the contractual agreement, acceptable usage policy and fees and all the HELP and FAQs so that you know what you are getting into. It is your responsibility to do so.

 

I used to trade forex and currency values change very often...

 

Based on my experience, Paypal really charges a lot with but I think it's worth the service compared to others.
I'd be more comfortable to pay higher for the great services than to pay for the low services and worry around all the time..