Recently Paypal Australia has introduced a new $6 fee and has increased its processing fee for credit card transactions for overseas money transfers. So this means if you send money to a friend or family member overseas you have to pay AU$5.99 fee per transaction using Paypal. If all or part of that transfer is covered by a credit or debit card, Aussies will also cop a 2.6% fee, plus a currency conversion fee. Before the updated terms, this fee was 2.4%.
It’s important to note that the new fees are incurred by Australian account holders sending money out of the country that doesn’t involve international commercial transactions.
Also while it might be meant for sending your family some dosh when needed, it should be noted that some sellers request a “personal transaction” as opposed to a “goods and services” settlement when making a purchase.
Personal Transaction fees are based on the payment method used to fund the transaction. A currency conversion may apply if sending a foreign currency.
If you are an Australian account holder sending money to a friend or family member with a PayPal account in Australia, you may pay a fee depending on how you pay. This means if your payment method is Paypal balance or Australian bank account then its free but if any portion of that method is funded by a card then 2.6% of the portion funded + fixed fee based on the currency is charged.
If you are an Australian account holder sending money to a friend or family member with a PayPal account in a country other than Australia, the fee you pay depends on the payment method used and the amount you are sending. If you’re sending a currency other than Australian Dollars, the applicable fee will be a comparable amount in that currency, using the prevailing transaction exchange rate.
If PayPal converts currency, it will be completed at the transaction exchange rate which is set for the relevant currency exchange. The transaction exchange rate is adjusted regularly and includes a currency conversion fee applied and retained by paypal on a base exchange rate to form the rate applicable to your conversion. The base exchange rate is based on rates within the wholesale currency markets on the conversion day or the prior business day; or, if required by law or regulation, set at the relevant government reference rate(s).
For some uses of your PayPal account, PayPal may determine currency conversion is necessary. For any of the following transactions that involve a currency conversion in connection with your PayPal account, the currency conversion fee is 3.5% for converting to US Dollars or Canadian Dollars, and 4.0% for converting to all other currencies:
When your payment is funded by a debit or credit card and PayPal determines a currency conversion is necessary, you consent to and authorise PayPal to convert the currency in place of your debit or credit card issuer. In most cases, you may have the right to have your card issuer perform the currency conversion, if applicable for that card issuer and network.
Currency preference selections may be presented to you in various forms, including a choice of which currency is used for the transaction, whether PayPal or your card issuer performs the conversion, or which conversion rate is used for the transaction, among others, and may be made available individually for each card and for each automatic payment agreement. If your card issuer convers the currency, your card issuer will determine the currency conversion rate and what fees they may charge.
PayPal will always perform the conversion for transactions where your PayPal balance or linked bank account is the payment method.