Paypal charging exorbitant fee's to transfer to Canadian bank accounts under the guise 'free'

[productaxi]

Paypal is stealing from us under the guise of 'free.'

Not only do I have a U.S. dollar account where I should be able to send my U.S. dollars, but they insist on doing a conversion with absolutely no other options into a CDN dollar account.

On an $800 USD transfer, im losing $22 to 'free' bank deposit withdrawal fee's, due to under inflated exchange rates.  Check the current exchange rates, and compare it to PayPal's for the proof.

It's bad enough the fee's charged for accepting PayPal in the first place, but this is absurd, all under the guise of free.  For an international payment company, you'd think they would allow you to at least keep the currency's if I have the corresponding accounts.

Cost of doing business or cost of getting screwed?

[pierrelebel]

For over ten years, PayPal has charged most sellers 2.5% exchange conversion fee.  That is the same rate charged to you by most credit card issuers.  Banks generally charge 2.0%-2.5% depending on the size of the transaction.  Small retail transactions (under $10,000) pay the highest percentage.  When converting US$ money orders at Canada Post, they charge you 3.0% conversion fee (built in the conversion rate).

I understand the conversion rate at PayPal is being increased to 2.75%

Yes, it is a cost of doing business. 

[brandeentertainment]

If your a Canadian why not switch to CA Currency no conversion anywhere on that..

Paypal fees I find are very fair not to mention ebay fees are as well ...

Look at what they offer your fees ..

Paypal a Safe way to buy and sell almost anywhere now .. You can pay straight from bank or credit card and a pre paid card if I am not mistaken ... As a buyer they protect your money ..

If you send email money transfer through your bank account and you get ripped off the bank that you pay fees to every month and for everytime you use your debit card etc etc they don't protect you at all ...

Ebay which I know is of topic but for the 9-10% fees you are being exposed to customers that would never even know you existed in other words ebay is doing for you what a website and 10k inn google adwords couldn't do ... Also it makes it very issue to build a customer base in case you do want to open a site...

All fees here and there are fair you just have to adjust the best you can to minimize the hurt 😉  Maybe switching to Canadian currency will do that for you .. Strong US dollars means Americans see the Canadian dollar as an instant Sale prices ... As a Canadian buyer I personally want a quick grab and go purchases and conversion rates are not part of the grab and go but many buyers do not think like me so this is just my opinion 

[anguscoinshop]

Off topic for now,

Merry Christmas to all board contributors.

[mosaicandtilesource]

Hi

Slightly troublesome if you are a business but workable .

Open a cross border bank account in The USA through your local bank in Canada which is in US$ in USA and transfer your payments to that account where there is no FEE , then have another US$ bank account in Canada , and transfer US$ between the 2 banks , NO FEES or CONVERSIONS all the way through.

Cheers

[reallynicestamps]

productaxi-- you may do better with that lot of nine goggles if you correct the spelling. I think there is only one Google and it is an internet company.

[Anonymous]

Be glad that it is not 70 cents like it was in 2003!!  Yes I do still remembered as I went to Grand Forks, ND to do some shopping and it felt like I was paying 50% more!

PayPal is still cheaper comparing what we would pay a little more at banks or post office for money orders.

[pricticaldeviations]

Nobody exchanges money for free.  So the goal is to minimize the premium your financial institution tacks on to the mid-market rate.

All Cdn banks and credit cards will ding you 2.8%, which sucks.  So AVOID THEM.

Paypal will ding you 2.5%.  So already paypal is better than the banks; and I certainly would not call it "exorbitant".  Further, if your paypal merchant sales exceed $3k/month, the premium drops to 1.5%,  and above $125k, to 1.0% (see Sec 8.8 at https://www.paypal.com/webapps/mpp/ua/useragreement-full?country.x=CA&locale.x=en_CA#8

XE.com will ding you about 1.6%.

Norbert's Gambit will ding you 0.0% plus a $20 flat fee, but requires a bit of fancy footwork.

Your best course of action may be to focus on getting sales about $3k/month, which'll reduce lots of problems, including your exchange rate.

[pocomocomputing]

I thought I read in these forums recently that PayPal was changing the exchange rate from 2.5 to 2.75 or 2.8 %. I can't find the topic or post now. Which makes sense if everyone else is going to 2.8% from 2.5%. PayPal would not pass up an opportunity to charge more if everyone else is doing so.

So is PayPal still 2.5%?

[ypdc_dennis]

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@pricticaldeviations wrote:

All Cdn banks and credit cards will ding you 2.8%, which sucks.  So AVOID THEM.

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The foreign currency conversion fee for most Canadian bank credit cards is 2.5% NOT 2.8%

[bat4300]

 I believe to be fraudulent policies that allow Paypal to convert and charge a fee on that conversion over and over again in each transaction.
Exemple given:
- item bought: C$ converted to U$ to pay
- item returned and funds refunded in U$ - funds in U$ in Paypal account - reconverted AGAIN in U$ funds
- New item is bought with same funds still in Paypal account (now in U$/C$ ) and funds once more are reconverted to U$ funds

And the process goes on and on
and lost over a 100$ to the conversion process 
And that is how .Paypal hidden fees steal yr money

[pierrelebel]

"funds refunded in U$ - funds in U$ in Paypal account - reconverted AGAIN in U$ funds.... and lost over a 100$ to the conversion process "

After fourteen years of dealing with it extensively (over 100,000 transactions on eBay in several currencies) frankly you lost me somewhere.  Could you provide actual numbers (dollars and cents) how the transaction started and how it ended, step by step with dates.

If PayPal screwed up, they will refund whatever was lost in excessive conversion fees (typically 2.5% each way, same as most credit cards).

As Canadians working in Canadian dollars we all understand that if we buy something in a foreign currency, there will be a conversion fee.  If the transaction is eventually refunded, another conversion fee will be required.  That seems unfair but that is the way it is.  However, what you describe seems to involve more than two conversion fees (one out, one in).  In the old days, credit card companies would offset one refund against the original charge in foreign currency and waive the conversion fees (in/out); that has been changed several years ago and today mostcredit card companies charge both fees.

[theclassof1984]

Do you realize that a Canadian citizen is able to get a US bank account in most banks? The US banks actually treat you like a customer and not a cash cow, they don't nickel and dime you for every transaction and make it seem like they are doing YOU the favour for looking after your money. Perfectly legal. Of course, there are no BS arbitrary conversion fees and transfers to and from Paypal account takes far less time. It's a no brainer.

[silentmobius]

So what's the best way to get your US funds from paypal to CAD at your bank? Its like ~2% conversion from paypal to transfer to my bank, then another ~2% the bank charges (on top of that a new $25 charge i got this month whatever that is) that really really adds up

Only thing I can think of is transfer to US based canadian bank from paypal (hope theres no fee), then have that transferred to the canadian location..then ... i have no idea but Ive heard few companies exchange for about 1%

[pjcdn2005]

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@silentmobius wrote:

So what's the best way to get your US funds from paypal to CAD at your bank? Its like ~2% conversion from paypal to transfer to my bank, then another ~2% the bank charges (on top of that a new $25 charge i got this month whatever that is) that really really adds up

Only thing I can think of is transfer to US based canadian bank from paypal (hope theres no fee), then have that transferred to the canadian location..then ... i have no idea but Ive heard few companies exchange for about 1%

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What is your bank charging you 2% for?

[silentmobius]

I'm not sure, i actually just noticed it today, the converted amount (usd to cad) from paypal is more than the actual amount on the bank statement by about 2%. 

[tinman-row]

Amazon  Visa credit card has a conversion fee of about .4%. There is discussion on red flag deals about this credit card. Anyone who buys in foreign currency (ebay) should use this card. For example recently I won a Ebay auction for $81.55us, Paypal billed my card $81.55us. Amazon charged my card $95.22ca. If I had let Paypal do the conversion they would have charged my card $97.13ca. So I saved $1.91ca

[mcrlmn]

I have a US account at the Credit Union I deal with.

I planned a vacation to Los Angeles, and thought, " Wow how convenient! I can just transfer my PayPal US funds to my bank account, withdraw it, and go. No need to buy any US currency."

Ya think?

Fat chance!

[pierrelebel]

Unfortunately, rules by the Canadian Bankers Association prevent PayPal from transferring US$ to a US$ denominated account held at a Canadian bank.

I remember a discussion many years ago with the PayPal country manager.  They would have loved to do it but Canadian banking rules will not allow it. 

What many Canadian sellers have done (myself included back in 2000) was to open a bank account at a bank located in the USA.  Sellers can then transfer US$ to that bank which can be used for whatever purposes.  Prior to my retirement, I would often use those US$ in my US account to pay for large purchases made in the USA.  Buy in US$, pay in US$, sell in US$ and get paid in US$ - it all worked fine without paying any conversion fees.  If money was needed in Canada, I would write a cheque payable to myself and convert here at my local branch.

Prior to 9/11 it was easy for Canadians to open an account at a US bank online.  Unfortunately the anti-terrorist banking laws passed by Congress following 9/11 have made it difficult to do it online.  It can be done in person with adequate identifications.