PayPal currency spread stealth fee increase for US merchants

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PayPal will increase the PayPal currency spread for US merchants by half a per cent for US merchants as of the 3rd of September 2019. This will impact you if you’re a US retailer or if you’re a global retailer and have a PayPal account registered in the US.

If you’re not sure what a currency spread is, it’s simply a way for currency exchange businesses to make money on every transaction. When buying a currency they offer a different rate to when selling the same currency. PayPal are simply increasing their take rate every time. When a customer pays you in anything other than US dollars you’ll get slightly fewer dollars and if you’re paying in a foreign currency it’ll cost you slight more dollars than previously.

We’re calling this a stealth fee as you’ll never see it itemised in normal circumstances and it’s on top of any normal currency fluctuations. PayPal will simply display the conversion rate and you’ll have little choice but to accept it. The only way around it is to establish an entity in other countries you wish to trade in, open a bank account and withdraw money and use an alternative provider to convert to and from dollars.

Amendments to the PayPal Account User Agreement and the PayPal Cash and PayPal Cash Plus Terms & Conditions

  • PayPal are changing the PayPal currency conversion spread to 3.75% (previously 3.25%) for transactions that involve a PayPal currency conversion when you pay for goods or services or send money.
  • PayPal are changing the PayPal currency conversion spread to 3.0% (previously 2.50%) for all other transactions involving a PayPal currency conversion.

Amendments to the PayPal Website Payments Pro and Virtual Terminal Agreement

  • PayPal are changing the PayPal currency conversion spread to 3.0% (previously 2.50%) for all transactions involving a PayPal currency conversion.
  • PayPal are providing the terms and conditions for our Account Updater functionality. When made available, Account Updater will allow merchants to update their U.S. customers’ eligible card data stored with PayPal to enable the seamless processing of recurring billing, recurring payments, and/or other eligible transactions.

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