Paypal currency conversion and Credit Cards

efunc

Hi all,

I've just bought a $23 item off ebay US. Usually when you pay through paypal you have a choice of paying directly from your paypal funds and are charged about £2.50 for the conversion (I think?) or can pay via a credit card where the rate and conversion is in the hands of the credit card company. In my case I use American Express, but after a whole day of searching I can't find any details of their rates and conversion charges.

My basic question is, which would ultimately be cheaper? Paypal balance with high conversion rate and surcharge, or American Express card via Paypal with undisclosed currency conversion fee applied later?

Anyone have any experience of this? Thanks!

efunc

BTW, it's business/premier account I have. I have a £, $ and € balance displayed in my account overview, but I understand they are all reflecting the overall pot in the account rather than 3 separate funds. I'm not sure if this makes my $ transactions easier/cheaper, but I guess not. Anyone?

Maysie

When i paid for something this week i paid exactly what i expected. The price conversion was showing in my ebay and thats what was debited from my bank account. Do you only have a credit card set up to pay for goods through paypal? I did not realise paying by credit card would make any difference.
The rate i paid on the 16th was Exchange rate:
1 British Pound = 1.55778 US Dollars
No doubt this will have changed abit already. Just before you confirm it does show a conversion rate and how much in £ will be taken if that helps.

efunc

thanks for the advice. I paid from my paypal balance and did not seem to have any other fees added. I seem to remember reading that 2.5% or even £2.50 is added by Paypal as a conversion fee unless you opt out and send the payment via a credit card? nevermind!

terra_ferma

efunc wrote: »

thanks for the advice. I paid from my paypal balance and did not seem to have any other fees added. I seem to remember reading that 2.5% or even £2.50 is added by Paypal as a conversion fee unless you opt out and send the payment via a credit card? nevermind!

Just the 2.5% added to the conversion rate itself.
I never use a credit card so can't comment on that, although I read that PP is cheaper than a CC.

efunc

yes, that appears to be the case, however it's a difficult calculation. the credit card might work out cheaper, but it depends on the particular card/account in question and is hard to predict. I makes more of a difference when spending a couple of hundred pounds or more, so I really ought to get to the bottom of this sometime.

terra_ferma

I was surprised to hear that PP is cheaper for receiving foreign currencies that CC and many current accounts, people slag PP off at every opportunity but after all they are not worse than an ordinary bank (except that they are virtually unregulated, unaccountable etc).

JohalaReewi

forex conversion fees for credit cards vary from card to card but 2.75% is not unusual. I believe Amex is 2.73%. There are some cards that charge less. Like Nationwide 1%, Saga and PostOffice 0%.