Why does Ebay rip Canadian's off with exchange rates that are no way near the actual rate?

[pierrelebel]

Could you provide a specific example ?

From what I have seen in eighteen years buying and selling on eBay, the conversion rate offered by eBay is generally accurate (allowing for small daily fluctuations).

Or is your comment about the converted amount at time of payment where PayPal charges a 2.5% conversion fee if payment is made/received in a different currency.  That conversion fee by the way is competitive with most banks and credit card issuers for retail transactions.

[cflfan]

Maybe that's what it is when I pay for something it's usually about 3 to 4 cents off the actual rate that day from my banks rate. I still think they over charge , but what ever. It will not stop me from buying.

[pierrelebel]

"I still think they over charge "

They do not.  The difference is the 2.5% conversion fee charged by PayPal (no longer associated with eBay).

If you were to pay with a credit card directly instead of using PayPal, you would pay a similar conversion fee in most instances.

The conversion rate seen on TV, newspapers and banks is the "wholesale" rate (intra-bank).  Retail rate is typically 2.5% higher or lower depending whether you buy or sell a foreign currency.

eBay has nothing to do with it.  Nothing!

[cflfan]

You wanted an example, today I purchased a football card for $4.00 US with today conversion rate of 1.3257 comes out to $5.30 Canadian. I paid $6.83 even with Paypal's fee of 2.5% it does not add up.

[pierrelebel]

US$ 4.00 for item.  How much for shipping? (I am guessing US$1.00)

[cflfan]

Yes my mistake forgot to add in shipping.Total was $5.00 US. So I guess it is closer than I thought.

[komics4sale]

(1)  I have no problem with Paypal charging buyers 2.5% for doing the exchange on purchases.

(2)  I have a slight problem with Paypal charging sellers 2.5% exhange when they withdraw the Paypal funds into a Canadian Bank account.

(3)  I have a big problem with Paypal still charging sellers 2.5% exchange when they withdraw thier funds into a US$ account in a Canadian bank.

I know there are some ways to get around this, but the options are not easily available to most.

(4) I have a very frustrating problem with ebay not listing a closer approximation of exchange costs on the listing page.

ie.  they only include the current US-Can exchange rate of 39% & not the additional 2.5% which brings the current conversion to about 41.5% more for items listed in US$

~ also don't forget to do the calculations of the stated shipping listed in US$

~ when sellers put their postage on the parcels, it is using stamps they bought using Can$, not US$

*** I believe a fair business practice would be for ebay to automatically add the Paypal 2.5% conversion fee to more accurately reflect the approx cost to buyers when they are browsing listings.

I know that there are ways that buyers can pay without incurring Paypal's 2.5% fee, but in the vast majority of cases, payments are usually done via Paypal...

[pierrelebel]

" when they withdraw thier funds into a US$ account in a Canadian bank"

That service is NOT available.  Period.

Canadians can have a US dollar denominated at any major Canadian bank.  However, PayPal cannot and does NOT transfer US$ from a PayPal account to such US dollar denominated account.  To transfer US$ to a bank account, the bank must be physically located in the USA.  Many Canadian eBay sellers do have such bank accounts.

" a slight problem with Paypal charging sellers 2.5% exchange "

ALL Canadian financial institutions do charge a conversion fee (typically 2% to 3% for most retail size transactions) when converting any currency into another - whether buyer or selling.  PayPal is not different than most.

The only way for Canadians to avoid currency conversion fees when buying or selling online is to buy and sell in Canadian dollars.  Not that easy, is it?

[komics4sale]

I am aware that Paypal does not allow withdrawing US$ funds into Canadian banks.

Sorry if I didn't specify  that point in my original note.

In my blurb, I did make reference to the fact that in some rare circumstances, which you elaborated so eloquently, it is possible to withdraw US$ into your US$ bank account.

But...only if certain circumstances are met (which are usually not readily available to most of us in Canada).

I actually opened up a US$ account in my Canadian bank just for the purpose of withdrawing US funds without incuring any fees.

Found out later that it is not allowed by Paypal, so I cancelled the account.

Also informed by a few ebayers, that they can do it under "specific circumstances" which I'm not going into here.

I opined that I had only a slight problem with Paypal's 2.5% exchange conversion fee.

I have the same slight problem with all the other institutions also, so am not singling out Paypal.

I think everybody has the right to be in business to make some money, but I think the 2.5% to 5% fee charged by ALL institutions are a bit of a money grab.

This fee is essentially for an electronic conversion in which the firms did not have to hire someone to sit with a calculator to process.

I don't have the time nor inclination to get into discussing about the taxes, electricity bills, cost of running a brick & mortar buidling, & bad transactions that a company has to also account for.

Even with all these "expenses", 2.5% is a bit too much.   Maybe not terribly concerning for $100 which calculates to be $2.50 .....but for $10,000 the fee is $250.

$250 may be better spent by giving some of it to a few homeless people.  It would sure help brighten their Christmas season.

PS  I know my last sentence regarding homeless people can spark a lot of discussion both pro & con, but please refrain.

I only wrote it with a bit of sarcasm.

[komics4sale]

My original reply was just to side with cfifan regarding exchange conversion fees.

Even after you pointed out that he/she neglected to add in the shipping charge & his/her complaint wasn't as bad as he/she had thought, it still doesn't alter the 2.5% conversion fee discussion.

As per your last comment about just doing one's buying/selling in Canadian $ auctions only....

I am both a buyer & a seller.

As a seller, I list all my items entirely in Canadian Dollars.

As a buyer I'd like to just buy auctions listed in Canadian dollars, but sometimes unavoidable, as desired items may be listed in US$.

In the latter case, I figure out my maximum in Canadian dollars that I would like to buy the item & write that number down.

Then I must 'hunt & peck'....meaning I have to take out my calculator.....pick out a number which I think is close to my bid....add on the shipping charge, & maybe add on the sales tax if applicable, then multiply that number with 1.415 & finally see if the number I selected ends up close enough to my price.

If it doesn't, I have to enter another number into my calculator & do the whole exercise again & again until I arrive at approx my predetermined amount that I am willing to pay.

The entire exercise is further compounded when I am buying multiple items from the same seller who adds 50 cents extra per addition item.

You may now understand how irritating I feel when purchasing from Canadian sellers listing in US$.

If their listing was in Canadian dollars to start with, I likely wouldn't even need to take out the calculator.

However, there are many Canadian sellers who list in US$ who claim they make more from the exchange rates.

If they in fact do make more from the exchange, then it must then be the buyer who loses the very same amount that the seller claims to make.

Additionally the 5% exchange conversion fee that paypal makes extra must come from somewhere.....Maybe split from the buyer & seller's pockets.

No comments please on the fact they maybe some sellers are listing mainly to the larger US market.

This is merely a personal thought on the frustrations of buying from a Canadian seller who lists in US$.

I have no issue with sellers who lists in US$ as they have the right to list in whatever currencey they feel most comfortable with.

Just elaborating on how much more difficult it is to buy from them.