Exchange Rate Conversion Scam!!

Karo · Feb 28, 2008

Sorry if the title fooled you a little bit, but it is not actually a scam. Have you noticed ebay and paypal have different rate conversion for currencies? I have only noticed this recently, especially for expensive items where you really can tell the difference.

I use ebay.ca and there is always a fluctuation between cad and usd. Recently the cdn dollar has been strong so on my ebay.ca page it shows approx. $1.03usd/$1cad but when I go pay thru paypal, it says $0.989../$1cad.

I know they make money off the rate conversions but do they really have to boost the ebay site that much? When you are using ebay.ca, they really make you feel things are cheaper if the auction is in usd.

Sorry for going on this stupid rant. I just hate myself a little more each time for using ebay or paypal.

clintonf · Feb 28, 2008

Originally Posted by Karo

Sorry if the title fooled you a little bit, but it is not actually a scam. Have you noticed ebay and paypal have different rate conversion for currencies? I have only noticed this recently, especially for expensive items where you really can tell the difference.

I use ebay.ca and there is always a fluctuation between cad and usd. Recently the cdn dollar has been strong so on my ebay.ca page it shows approx. $1.03usd/$1cad but when I go pay thru paypal, it says $0.989../$1cad.

I know they make money off the rate conversions but do they really have to boost the ebay site that much? When you are using ebay.ca, they really make you feel things are cheaper if the auction is in usd.

Sorry for going on this stupid rant. I just hate myself a little more each time for using ebay or paypal.

+ 100. I've noticed this a lot and if you use http://xe.com to look at the exchange rate it becomes very annoying.

Paypal is evil, but I guess a necessary evil in some cases.

alterion · Feb 28, 2008

paypal does give you the option of using your bank conversion rate instead though- except atleast for me that is never any better, so its just the way these things work really

penguin vic · Feb 28, 2008

That's why I don't use paypal for USD transactions. The rate they offer is horrible.

zshaver · Feb 28, 2008

When I used to use paypal, they would just ask for a credit card and I would pay the conversion fee through my Visa, which was only about 1%. I know now that the rate is around 2.5%, so this probly isn't much better. The only thing I will say is that the spread doesn't seem too bad, I'm currently studying in France and the cheapest way to transfer money is using my cdn bank card, which charges 3%+ over the market rate of the currency, which starts adding up pretty quickly.

FIHTies · Feb 28, 2008

Originally Posted by clintonf

+ 100. I've noticed this a lot and if you use http://xe.com to look at the exchange rate it becomes very annoying. Paypal is evil, but I guess a necessary evil in some cases.
For the record, XE will give you the middle market rate which is between the buy and the sell. When buying euro you will never get the rate they show so if you see a 1.51 dollar/1 Euro expect to pay 1.52.

aleksandr · Feb 28, 2008

okay so - whats the best way to avoid getting hit on currency conversions?

teddieriley · Feb 28, 2008

my cc charges 3%. That is, too my understanding, pretty standard. If you can get less than that, great. I don't think you can "avoid" it, unless you use a card from the country you are purchasing from, I'd think.

cchen · Feb 28, 2008

Guys,

Ebay is going to show something closer to the mid-spot rate at that time. Obviously, paypal is going to take a spread for doing a FX transaction for you so the rate is going to be worse.

DNW · Feb 28, 2008

Originally Posted by aleksandr

okay so - whats the best way to avoid getting hit on currency conversions?

Other than opening up a bank account denominated in the currency with which you're paying, not much else you can do. Just because you know what the exchange rate is doesn't mean you can actually get that rate. Transaction cost is always lurking in the background.

clintonf · Feb 28, 2008

Originally Posted by FIHTies

For the record, XE will give you the middle market rate which is between the buy and the sell. When buying euro you will never get the rate they show so if you see a 1.51 dollar/1 Euro expect to pay 1.52.

Thank you for the information. I didn't really know that.

Regards

Clint

Dewey · Feb 28, 2008

Capital One absorbs Visa's 1% foreign currency transaction. A card with this feature is the best and maybe only way to avoid getting screwed on overseas transactions. Link

That link is almost 3 years old, but I believe the information is still pretty accurate. I use a Capital One card for my Jantzen orders & have never seen a fee.

Here's another, more recent link, which lists some other cards that absorb the fee for the consumer. Link

Exchange Rate Conversion Scam!!

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