Why is PayPal taking a fee
PayPal is taking a fee because it charges for payment processing, currency conversion and the fraud and purchase protection attached to certain transactions.
Whether a fee applies depends on the type of payment, how it was funded and whether it crossed a border. PayPal's own help centre lists receiving payments for a purchase and receiving payments from outside your country among the transactions it charges for.
- Goods and services payments: When you sell something or receive a business payment, the recipient pays a commercial transaction fee, typically around 2.99% to 3.49% plus a fixed fee, which funds Purchase Protection for buyers and sellers.
- International commercial payments: Pricing breakdowns for sellers in India put the commercial transaction fee on international payments at 4.4% of the amount plus a fixed fee.
- Card funding: Sending a personal payment with a credit or debit card, rather than a linked bank account or PayPal balance, adds a funding fee.
- Cross-border transfers: Sending money to another country, or receiving a payment from one, triggers an international transaction fee.
- Currency conversion: When one currency is converted to another, PayPal applies a markup on top of the standard exchange rate.
To work out which charge you saw, check the transaction details in your account. Note whether it was a personal or business payment, whether you were sending or receiving, and which funding method and currency were used. Comparing those details against PayPal pricing for your country shows which fee category applied.
Some fees can be reduced by changing how a payment is made. For personal transfers, funding from a bank account or PayPal balance avoids the card funding fee, although cross-border and conversion charges can still apply.