Currency Conversion: Use your Bank, not eBay or PP

[30ranfordfan]

Just a friendly tip. I've always taken it for granted that my bank will offer a better conversation rate than PP or eBay would. Today it occurred to me to actually look at it.

I made a purchase, in USD, that came to a total of $13.11.

eBay wanted to convert the transaction to CAD for me, and it would have been $17.57 CAD. I selected to keep it in USD, and went to PayPal to pay for it.

When setting up the purchase in PayPal, via credit card, PayPal defaults to converting the transaction to CAD. They wanted to charge me $17.61. A couple of clicks later, I've changed it to charge me in USD, and let my credit card do the conversion.

Looked at my online banking, and I was charged $17.33 CAD for the transaction.

Both companies are making plenty of transaction fees, but they're also making money off conversion rates. I would imagine they get a much better rate themselves than any of us do.

Just something to be mindful of, you can save a fair bit over the course of a year.

[sleepn0t]

30ranfordfan, in fact I think the way it works it's just that PayPal has its own change rate... Obviously, they're probably also making money off of it; it's a business/company after all. That being said, I've purchased a card, from the United States, on eBay a few days back. When came the time to pay, two payment options were offered to me. I had the choice to pay in Canadian currency, or in USD. I finally went with the CAD, although it cost me a little more that way, at the time I made my payment.

Problem was that, if my memory's good, by paying in US currency, my credit card company could have charged me some extra fees, in order to do the conversion between the two currencies. It's something like that anyways.. But, I know that at the time I sent my payment, it would have for sure cost me less to pay in US. I was only afraid that later on, my credit card charges me some additional fees on my invoice. In other words, I was kind of afraid of "hidden fees". So in the end, it may have cost me like 5 more bucks at the checkout, however, no bad surprises afterwards.

But overall, I'm really not an expert, so idk what would be the best way to go in the future, for my upcoming transactions (when buying from the US - I think it only applies then anyway). More $ at the checkout, but no extras later? Or else, the cheapest possible when comes the time to send my payment, but with the risk that there might be "bad surprises" afterward?! Any tips are welcome, of course. Thx!

[30ranfordfan]

30ranfordfan, in fact I think the way it works it's just that PayPal has its own change rate... Obviously, they're probably also making money off of it; it's a business/company after all. That being said, I've purchased a card, from the United States, on eBay a few days back. When came the time to pay, two payment options were offered to me. I had the choice to pay in Canadian currency, or in USD. I finally went with the CAD, although it cost me a little more that way, at the time I made my payment.

Problem was that, if my memory's good, by paying in US currency, my credit card company could have charged me some extra fees, in order to do the conversion between the two currencies. It's something like that anyways.. But, I know that at the time I sent my payment, it would have for sure cost me less to pay in US. I was only afraid that later on, my credit card charges me some additional fees on my invoice. In other words, I was kind of afraid of "hidden fees". So in the end, it may have cost me like 5 more bucks at the checkout, however, no bad surprises afterwards.

But overall, I'm really not an expert, so idk what would be the best way to go in the future, for my upcoming transactions (when buying from the US - I think it only applies then anyway). More $ at the checkout, but no extras later? Or else, the cheapest possible when comes the time to send my payment, but with the risk that there might be "bad surprises" afterward?! Any tips are welcome, of course. Thx!

If you have to pay a foreign currency charge with your credit card, then what I said doesn't apply. I do not.

What eBay & Paypal do is charge slightly higher rates.

eBay was charging $1.3402 CND per USD
Paypal was charging $1.3432 CND per USD
Bank charged me $1.3219 CND per USD

Those two cents will add up in a hurry if you spend thousands.

Best tip I could give is to read your credit card documents, or ask at your bank. If there's foreign exchange fees like you described, what I just said would be more expensive to do - but it's possible you could switch to a different kind of card that doesn't have them.

[ChuckNorrisFearsS]

PayPal uses a bit of a floating rate. I was sending money to a Canadian seller earlier for a private sale and noticed it said that the actual amount may change and to check my statement, or something to that extent.