eBay

musicyouneed · ‎08-01-2020

I received a question from a US buyer: And, I've never had to pay anything additional from Canada. Could you exp!win it you've had buyers that received extra charges.

When a US buyer pays, they pay for the .com in US $ and then how does it work with the Cdn $ on .ca?

ricarmic · ‎08-01-2020

Are they talking about the IST (Internet Sales Tax)?

I've gotten questions/frustrations about that - they wonder why buying from a Canadian means they pay taxes "to a Canadian".

(PS here's what I send them, something like this:

Trust me, I dislike the Internet Sales Tax as much as you. The IST is something your state government there has put in place to gather taxes on purchases you make from large "facilitators" like eBay, Amazon etc irregardless of where the seller like me is from. It is actually eBay that is forced to gather the tax and send it to your state government, but they do it through my PAYPAL account (so it looks correct on the invoice and bill) which means them collecting taxes from you for your state government costs me 3% of the taxes (so if you pay $1 in taxes, I pay 3c in paypal fees). While the money comes through my PAYPAL account, I never get my hands on it. Most states have adopted the IST and some countries like Australia and Singapore too. So as you can see, the IST type taxes cost me more as well which is quite frustrating to me too!

musicyouneed · ‎08-01-2020

What about paying for a item that is listed on .ca. How does that show up on their credit card? Are they charged an exchange fee?

lady.stark · ‎08-01-2020

They are probably referring to the US $ conversion that appears on eBay, which is always below what they will really pay with the exchange rate of their credit card. For example (amount are not real numbers): C$ 10 will show up at about US$ 7 on eBay. However, their credit card exchange rate is different, so they will probably end up paying US$ 7.50.

ricarmic · ‎08-01-2020

Hmm I don't know, but I do know that they get the IST in $C of course on payments/purchases made on .CA

It probably depends on how their credit card treats international currencies and chooses to show it on their bill. If I recall I've had credit cards that show it different ways in terms of the extra charge for conversion.

I doubt anything in eBay/PAYPAL land shows it because it just references the currency used $C or $US.

femmefan1946 · ‎08-01-2020

To confuse matters, the difference between the two currencies shown on the listing is an educated guess.

The actual amount will vary with the exchange rate at the moment * so a $10Cdn sale may show as $7US on the listing, but be $7.06 on the actual invoice.
which would irritate the more OCD buyers-- but make it a $100 purchase and a 60 cent differnence or a $1000 purchase and a $6.00 difference and irritation turns the fury.

*and those rates do change moment to moment, although on the retail level we deal with, this is usually massaged to a daily rate.

pjcdn2005 · ‎08-01-2020

If they pay in US$ and the listing was in C$ they pay about a 3% conversion fee to change the currency to Canadian.

marnotom! · ‎08-01-2020

The exchange rate eBay uses for its "approximate" currency conversions is the latest mid-market rate available to them. Currencies have both a "buy" rate and a "sell" rate and eBay (as does conversion site xe.com) splits the difference when calculating the converted amount.

Buyers have the option of having PayPal or their credit card issuer convert the currency at purchase. It's a bit tricky setting things up so that your credit card issuer will do the converting, but it can be done:

https://thepointsguy.com/2017/05/save-money-by-changing-paypal-currency-setting-for-invoices/

My personal experience has been that PayPal's currency exchange rates are competitive with my credit union's and much better than my credit cards'. Others' mileage may vary, but do make sure that when you're applying that 3% conversion fee for the sake of comparison or calculations, that it's being applied to the official market "buy" or "sell" rate appropriately.

lotzofuniquegoodies · ‎08-01-2020

@marnotom!

Unfortunately that is a major problem with fluctuating exchange rates. With a purchase it could be at one rate. When/if you had to refund you would have limited control over the rate you would be charged. It could go up...It could go down. At least with PayPal there was some sort of stability. Now with multiple parties involved, do you really know what rate is being charged. Would be helpful if the applicable exchange rate at the time of transaction was clearly visible for all to see.

It's similar to any fuel charge Canadapost/USPS might be charging. All hinges on timing of the order. Will buyers and sellers have any kind of control in these situation. Most likely not!!!

-Lotz

PS. The one that always baffled me is how gas prices at the pump could change several times over the course of a day. Most often in an upward direction.

ypdc_dennis · ‎08-02-2020

@marnotom! wrote:
My personal experience has been that PayPal's currency exchange rates are competitive with my credit union's and much better than my credit cards'. Others' mileage may vary, but do make sure that when you're applying that 3% conversion fee for the sake of comparison or calculations, that it's being applied to the official market "buy" or "sell" rate appropriately.

PayPal adds 3% if converting between Canada/USA balances and 3.5% if conversion is done at time of purchase. Always best to convert between balances before buying or transferring to a bank account. Other currency conversions have a higher paypal percentage taken.

My current credit card (non-bank) takes 2.5% for exchange.

marnotom! · ‎08-02-2020

@ypdc_dennis wrote:
PayPal adds 3% if converting between Canada/USA balances and 3.5% if conversion is done at time of purchase. Always best to convert between balances before buying or transferring to a bank account. Other currency conversions have a higher paypal percentage taken.

My current credit card (non-bank) takes 2.5% for exchange.

My Vancity VISA levies a 2% administration charge, but if you read the fine-ish print, it says that charge is in addition to the "VISA exchange rate," not the market exchange rate.

https://www.vancity.com/CreditCards/Agreements/Vancity_Visa-CH_Agreement_Personal.pdf

My BMO Mastercard's disclosure statement has something similar; they levy a 2.5% charge on top of the exchange rate charged by MasterCard International (MCI).

https://www.bmo.com/pdf/MasterCard_COB_April%2010_EN.pdf

PayPal's user agreement refers to its "transaction exchange rate" without really defining it. There's a blurb that refers to the "base exchange rate" but I doubt that's the same thing:

"The base exchange rate is based on rates within the wholesale currency markets on the conversion day or the prior Business Day; or, if required by law or regulation, set at the relevant government reference rate(s)."

I think we need to be concerned more about the overall exchange rate and not the percentage being charged for administrative purposes or whatevz. When MasterCard International upped the commission it charged to BMO (and other card issuers) for currency exchange a number of years ago, the exchange rates for BMO Mastercard became really stupid and nothing like PayPal's, even with PayPal's fee being a higher percentage.

I also had Vancity VISA do the currency conversion on a purchase I made from the UK recently and I'm pretty certain that the converted amount worked out to be slightly higher than what I would have paid if PayPal had done the converting.