Make PayPal payments in local currency
Do you often transfer money in foreign currency through PayPal? Be sure to choose the right solution to get the most value for your money.
During the fourth quarter of last year, nearly 2.8 billion transactions were carried out among PayPal’s 267 million active users. The growing interest has led to a number of websites – including here in Norway – had begun to accept payments through the player to a greater extent.
PayPal recently announced that it will soon launch a friend payment service à la Vipps, and in that respect, it is important to keep in mind that the price they set themselves is not necessarily the most advantageous for you.
We recognize this phenomenon from card payments abroad, where you often encounter the question of whether you want to pay in local currency or in Norwegian kroner. If you choose the local currency, it is the card’s payment network (Visa, MasterCard and the like) that sets the course, and this has over time proved to provide the best exchange rate.
For the same reason, you should also choose to have the payment network do the conversion for you when you use PayPal.
Why should the card decide the rate?
The reason for this is that it is PayPal itself that decides the rate when using a currency other than its own, as is also evident from their own pages: “When you shop in foreign online stores, we can add a currency conversion fee”.
So let’s look a little more closely at a representative example. At a payment of 8,748 Japanese yen, PayPal considered the price to be NOK 719.50, while Visa would demand NOK 690 on the same day. However, one must be aware that the currency premium comes in addition when using a payment card, in this case, 1.75% of the total transaction amount. The final amount thus ended at around NOK 700.
Based on the above-mentioned example, it can be seen that the deviations in the two final sums are not extreme, but with many enough transactions – and not least in the case of larger amounts – this can actually constitute considerable sums in the long run.
Fortunately, the solution is just a click away, so be on your toes the next time you use PayPal.
© Dinero.no / #Norway Today