Does PayPal charge conversion fees

Yes, PayPal charges conversion fees whenever a payment has to be changed from one currency into another. The fee is built into the exchange rate PayPal applies rather than shown as a separate line.

PayPal starts from a base wholesale exchange rate and adds its own percentage margin, or spread, on top of it. The rate you receive is therefore lower than the rate you would see quoted on a currency market for the same pair.

• Personal accounts: The margin is usually around 3% to 4% above the base exchange rate when a personal or international payment involves switching currencies.
• Business accounts: The margin is usually close to 3% above the base exchange rate, and other cross-border or commercial fees can apply to the same payment.
• Separate from transaction fees: The conversion margin is charged on top of any fixed or international commercial transaction fee, so the combined deduction on a cross-border payment can be a noticeable share of the amount.

Because the margin sits inside the exchange rate, the cleanest way to see what a conversion costs is to compare the amount credited with the amount you would get at the base rate. PayPal publishes its current rates by country on its consumer fees page, and a PayPal pricing breakdown for your own region will show the exact percentage for the currency pair you use.

Before accepting or sending a payment in a foreign currency, check which currency the payment is being made in, whether a conversion will be triggered, and whether a commercial or cross-border fee also applies to that transaction.