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Paypal takes another chunk!

by NewbiesDiary
23 replies
Hey guys & gals

For a while I've had a couple of hundred US bucks sitting in my paypal account. I've been watching the conversion rate from US$ to AU$ - it dropped for a while there, but its coming back now, so I've been waiting for the right time to convert.

Today I checked the XE currency conversion rate and went into paypal to convert my moula - but there's a bit of a difference between the CURRENT conversion rate & paypals conversion rate!

XE shows US$ 1 = AU$ 1.49085
Paypal shows US$ 1 = AU$ 1.46

Now I know this isnt a huge amount of money, but consider if I have $1000 in US$ it suddenly looks like this...

XE shows US$ 1000 = AU$ 1490.85
Paypal shows US$ 1000 = AU$ 1461.62

And paypal is suddenly up $30 odd bucks on my money - on top of the fees they charge.

I know, I know - don't sweat the small stuff - and if you guys have seen my posts, you know I don't bitch about anything - but this one just got my goat!
#chunk #paypal #takes
  • Profile picture of the author Angela V. Edwards
    Have you thought about calling Paypal and asking them why their exchange rate isn't current? They may use the current rate, but their site hasn't updated to show that rate, yet. There are a lot of things it could be; I'd give them a call, if that's possible from Australia.
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  • Profile picture of the author Chris Grable
    If my math is right.... that's about 1% (0.97%). They probably feel its a reasonable fee to cover the costs of tracking currency rates and maintaining that functionality.
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    • Profile picture of the author Neil Morgan
      It's a revenue generator for them, pure and simple.

      And for the same reason, they won't let you add a bank account in any currency other than your home currency so that you can't get round their exchange rate.

      I know. I tried.

      Cheers,

      Neil
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  • Profile picture of the author kevinw1
    The Paypal exchange rate is always noticeably worse than the current posted rate - even worse than the rate I actually get from my bank, which is worse than the posted rate (the difference between changing currency one way or the other is the "spread"). I've been changing US$-CN$ for the last 9 years and it's been that way the whole time. It's just another way they make money - and another reason I try to pay for things in US$ from my US$ paypal balance!
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    • Profile picture of the author NewbiesDiary
      haha - a phone call to paypal equates to over half an hour waiting for them to answer, especially considering its Saturday here now.

      I usually leave it in US$ and trade in US$, but there's a big chunk sitting there & I wanna use the cash -if I withdraw it before 11am mytime I'll have it in 2 days, after 11am and it's 3 days - I don't do waiting too well, it's certainly not one of my traits LOL.

      So I'll transfer it & withdraw it and suck it up, cause after all what choice do i have!
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  • Profile picture of the author severt
    I had to pay 2500 euro to someone in the US.
    When I transferred the money to paypal it was worth 250 bucks more then when I send it to the guy!

    Wow 250 bucks!
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  • Profile picture of the author SeanSupplee
    Have you been watching the exchange rates in paypal as well? Do they follow that is showing in the market? Some places but not all will hold a conversion rate longer and not go by a day to day system. This may be what paypal is up to but not 100% sure as I have not had to look into it as of yet. Interested to know now though
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    • Profile picture of the author Neil Morgan
      Sean

      PayPal's exchange rate changes constantly.

      I have even found it to change from starting a withdrawal to hitting the final "do it now" button.

      Cheers,

      Neil
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  • Profile picture of the author NewbiesDiary
    the paypal rate has been the same for a few days now - I know the exchange rate is getting better for me every day, but I haven't seen a change in PP - I want the moula so I'm doing it today regardless
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  • Profile picture of the author Wes H
    As sad as it may seem, there will always be a discrepancy between what you see at XE and what you get once you've exchanged currencies through an institution, whether it's PayPal, a bank, or what have you. As kevinw1 said, it's the spread you're paying, and that's just the cost of doing business.

    Having said that, I think it truly sucks. Time for a brilliant alternative to the current exchange system ...anyone?
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  • Profile picture of the author tecHead
    Gotta spend money to make money, our Pink haired beauty.

    International currency exchanges have been the product of money making for ages... Forex.. Day Trading... big money.

    Only way you can win that game on the level of the consumer is to be a player... so, yeah... gotta suck it up and take your lumps and BE HAPPY you have "something" in there that you 'want'.

    PLP,
    tecHead
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  • Profile picture of the author AverageGuy
    if you use credit card, the rate is different from the market rate too. they have to make sure there is a margin that covers possible loss since they may not be able to convert at the same day/rate.


    david
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  • Profile picture of the author rondo
    There has always been a 2.5% exchange fee when you withdraw funds to another currency.

    https://www.paypal.com/us/cgi-bin/we...y-fees-outside




    Andrew
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  • Profile picture of the author ahuddy
    I'm sure payment processors are allowed a tolerance in the exchange rate. +/- 1% seems about right. It's tough to take when you are the consumer but paypal is a business, and they are in the business to make money.
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  • Profile picture of the author Mike Hill
    I noticed this and called them about a month ago.... They said that the exchange rate is set at the time the money goes into your account NOT when you take it out...

    Mike Hill

    PS. PayPal is not a bank so if I'm not mistaken they can set their own exchange rates.
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    • Profile picture of the author Kay King
      Mike -

      You beat me to it. I'd expect Paypal to give the exchange rate AT THE TIME of the transaction. If the rate dipped drastically right after the sales were made, this would be in your favor.

      So if the $200 is from transactions over a period of time - likely several actual rates were used.

      kay
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  • Profile picture of the author snidge
    Lol yah. I noticed the same thing a few months back but I was transferring out a few grand.

    I got in contact with PayPal and they gave some automated message a few times about how thats an average or something. I think it's just common knowledge that PayPal will screw you every chance they can.
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    • Profile picture of the author LEAPresearch
      Here's something else to consider about Paypal. At the end of the year, PP split into a US and a Mexican operation. Didin't matter that you had a US bank account, a us domain name. Only thing that mattered was your IP. I suddenly found myself locked out of PPUS. I can't even email them!

      Next, when you go in to add funds to your account, you're faced with a page that demands that you now have a Mexican Bank Account and that you can only deal through PP now via Pesos. They said that this was to "preclude money laundering." Well, that's exactly what they're forcing me to do. I opened an HSBC account and will do the transfer they request but I'm keeping a weary eye on them. I don't want my money sitting in a peso account when it could be doing much better in a dollar account. Tht's what my Citi account in the US is for!
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  • Profile picture of the author sunnyman
    Is this something new? I have ALWAYS had this thing with PayPal: they give me an exchange rate when converting from USD to my European currency which is maybe FIVE PERCENT LOWER than the official exchange rate!

    Funny, the say transfers are "free" when above a certain limit - which is a bunch of ***
    Actually, this is how they make money; it is really a hidden fee.
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  • Profile picture of the author twannahiga
    Paypal is a great and easy way to store money online, if your looking at currency excahage services the emailed I received from them said that that the exchange rate on your currency is set when your money enters your account, not when you make your withdrawl! Interesting....!
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  • Profile picture of the author RebeccaL
    Paypal always profit on the exchange rate. Just like those currency exchange windows do at airports. I get angry at Paypal too... but what can you do.
    I don't recommend leaving much money sitting in your Paypal account though!
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    • Profile picture of the author Mike Murphy
      I had this happen with PayPal as well. I had a just over $6500 sitting in there in USD and went to withdraw it into my bank (Canadian) and noticed the difference.

      I didn't want to play the waiting game either so I got a number from PayPalSucks.com and got hold of someone in minutes. The nice lady just said "well, we do our best to keep the exchange rate up to date" which is obviously not true.

      You're a business lady now my dear, keep track of the differences as write them off as "banking fees" as a business expense....or come up with an awesome new payment processor that we all love and will join ;-)

      Good for you for HAVING bucks in there to begin with!

      Mike
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