posted on June 20, 2001 02:21:26 AM new
Hi to all - and !!!PayPay!!!
I am in the UK, I have just been to withdraw from PayPal $290.00 into my UK Bank Account
The actual Live Exchange Rate was 0.713743 taken from the Web at http://www.oanda.com/convert/classic PayPal's Rate of Exchange was 0.6717, which results in a loss to me of £12.00 on top of their $1.50 transaction fee. Why is there such a high discrepancy in the exchange rates?
The reply I received from PayPal is as follows:
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Please note that the conversion rate is a variable rate, and is updated on PayPal daily.The global currency markets fluctuate daily, and the rate PayPal presents to users includes a small risk factor as well as a currency conversion fee in order to compensate for these fluctuations and costs associated with executing these transactions. The rate is a competitive exchange in comparison to retail conversion rates received at banks and currency exchanges. It is important to note that retail rates presented to consumers and displayed and used for your International Withdraw will differ from the rates you may see in the newspaper, on the internet, or on television. Published foreign exchange rates are often interbank rates, which banks charge each other for transactions valued at U.S. $1,000,000.00 or more.
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What a rip off. Comments please. Cheers to all - Dave
posted on June 20, 2001 09:59:24 AM new
Hi djcalc,
Thank you for your comments.
The information provided by the representative was correct.
The rates that we pay, and in turn have to include in our pricing model, are retail rates. The rates you see advertised in a paper are the wholesale rates for transactions involving larger dollar amounts (between banks).
posted on June 20, 2001 12:27:27 PM new
retail & wholesale are applied to currency exchange rates?
I've never come across *that* before...
Edited to say:
Went to Oanda.com, a currency exchange site. I'll be jiggered--I see now about the different rates. BUT the differences they show aren't as big as that described here.
I tried 3 rates to convert 10 British pounds to US dollars (today's rates):
posted on June 20, 2001 01:39:11 PM new
Hi djcalc,
1) How do you calculate your interest rate, risk factor and currency conversion fee.
(Rates will adjust daily, based off of the price we pay at the retail level)
2) How do you justify such a vast difference in the live currency rate and your currency rate
(Retail versus wholesale. The transactions you are doing are not the rates that banks exchange at, which requires larger dollar amounts than you are doing)
3) And where is it stated in any of your policies, regulations or agreement that you are actually allowed to deduct these sums.
(Fees are covered under the terms of use)
I am obviously anoyed with PayPal - but I do appreciate your replies.
I have looked at (Fees are covered under the terms of use)and (Fee Schedule) and cannot see anything there reference the subject matter.
The following is copied from Sending & Withdrawing Funds: _________________________________________
SOURCE OF FUNDS...................Fee
International Transaction Fee
(Credit Card Payments only)--------2.6% + 30¢
PayPal Balance Payment-------------FREE!
Withdraw to International
Bank Account-----------------------$1.50*
Withdraw to U.S. Bank Account------FREE!
_________________________________________
1) The only fee that I need to pay is the $1.50*
2) There is nothing stating that you will adjust the Current Rate of Exchange to cover risk factors etc. (WHERE IS IT STATED?)
3) As I have said previously on a $290.00 transaction not only do you deduct $1.50 (no problem) but on top of that you adjust the current rate of interest in order to deduct a further £12.00 GB Pounds.
4) There is no clause in our original agreement to allow you to adjust the current rate of exchange and thus deduct further charges from myself - other than those stated above.
5) Further you give no information how you calculate the difference
6) Also it is not envisaged until one needs to make a withdrawal from their account.
7) You are in fact making up your own current rate of exchange without any clarification and applying it without prior notification.
8) Please would you explain further and direct me to any agreement that shows otherwise.
