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I agree with most of your assessment but how is a 2.5% charge for a (forced) conversion reasonable? I live in Europe and get hit with the 2.5% conversion fee e
by speleding 13y ago
I agree with most of your assessment but how is a 2.5% charge for a (forced) conversion reasonable?
I live in Europe and get hit with the 2.5% conversion fee every time I receive USD (on top of the ~3.6% "cross border transaction" fee). I have a USD PayPal account and a USD denominated bank account but PayPal refuses to send the money to a USD bank account unless you are US based. They insist on converting it to EUR simply to get the extra 2.5% as far as I can tell.
- saurik 13y agoI say it is "reasonable" because my understanding is that the industry average is 2.8% (although I hadn't researched it that long). I really doubt that PayPal is trying to obtain a currency conversion fee there... there's probably some regulation about being unable to give you money in a foreign currency directly without being regulated as a different kind of entity.
- speleding 13y agoI couldn't find an industry average but my credit card gives 1.8% above IBLR (interbank lending rate), normal currency conversions for transfers from my bank account are even lower. But that is beside the point since I don't WANT to convert it (and neither does OP) there are lots of things you can buy with dollars. Since they do allow you to transfer USDs if you happen to have a USD bank account with a US bank it is very unlikely that regulation says they cannot do that for non-US banks (they are registered as a bank in Europe). As a foreign national you can only have an account with a US bank if you opened it before 9/11, so most people are stuck. IMHO they are simply taking a few extra percent because they can.