US dollar rip off

[peteriou]

The Australian dollar is currently worth $1.07 US. Why are product from the US still selling at a higher rate then the Australian. Eg a US product is selling for $300us eBay calculates to pay in our dollar $310.

[cherry*135]

1 USD =  1.07 AUD

300 USD =  323.54 AUD

[k1ooo-slr-sales]

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@peteriou wrote:
The Australian US dollar is currently worth $1.07 US Australian.

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(sorry, just had to correct you Opening Post, the rate was the wrong way around)

eBay provide a 'guide' to the exchange rate when you view an item, but this is not the rate that you will pay when you pay for an item.  My last US purchase was about a week ago and the PayPal exchange rate was about A$1 = US$0.89 even though our dollar was trading over US$0.92 at the time.

Even banks do not provide the exchange rate you see on the news or read in newspapers when you complete in international transaction.

[cq_tech]

The difference between the listed amount and the actual amount paid is due to the 2.5% surcharge which Paypal charge as a premium for performing international (cross-border) transactions.

[digital*ghost]

Sadly, it's now 4% - it was increased several months ago. If you add 4% to the estimated conversion showing on eBay, you'll get the price you'll pay via PayPal, give or take a few cents (the higher the price, the greater margin for a discrepancy in actual cost, but it should still be quite close). 

[cq_tech]

Actually DG, the rates vary slightly according to the type of transaction, but you are essentially correct. For purchases, it is 4% for all countries other than the US or Canada, where it is 3.5%. Seems that usury is still alive and well in the land of Paypal. 😞

From the current Paypal Fee Schedule:

1. When funding a Commercial Transaction where the buyer pays in AUD and the merchant receives USD or CAD we apply a currency conversion fee of 3.5% above the wholesale rate.
   
   Assuming you wish to buy an item that costs $100 USD:
   • Example wholesale rate: $1 AUD for $0.96 USD.
   • Rate applied: $0.9275 USD.
   • You will be debited: $107.81 AUD.
   • Currency conversion fee: $3.65 AUD (included in the debited amount above).
2. When funding a Commercial Transaction where the buyer pays in AUD and the merchant receives a foreign currency (not USD or CAD), for example EUR, we apply a currency conversion fee of 4.0% above the wholesale rate.
   
   Assuming you wish to buy an item that costs €100 EUR:
   • Example wholesale rate: $1 AUD for €0.74 EUR.
   • Rate applied: €0.7115 EUR.
   • You will be debited: $140.54 AUD.
   • Currency conversion fee: $5.41 AUD (included in the debited amount above).

[digital*ghost]

Well, that explains why my calculations have been a little off for USD amounts lately - you shouldna told me LOL, as I've been blissfully ignorant, which led to pleasant surprise every time I saw the final payment amount was a few cents lower than my calculations. 😄 

[aussietastic]

Yes it stinks! and it stinks real bad.

Makes you wish you had studied a bit harder at school.

It is simply legitimised criminality under the guise of free enterprise. A huge fee for something that costs cents.

Like the recent bank late payment fees furor which were found by Federal Court to be in breach of contract, of coarse the problem of this attitude by banks had been a long standing one and not everyone has the opportunity to organise a class action of 30 000 plus customers to achieve a result.

It also takes various shapes and forms, I purchased an item from America back when the dollar was at parity. The purchase site didn't accept PayPal so used my Visa card, now when paying I said I was paying in Au Dollars and they charged we a conversion fee at that time (about 3 something %), which I thought was standard and everything went fine no problems, until I got my Visa statement.

There was a charge for International transaction of 2.5%, I nearly fell over backwards. I rang the bank and they said yes that is correct. I said isn't Visa designed for international transactions?They basically said yes and suck it up!

You pay 19% interest plus an annual fee....... and they want more!!!!

The rich get richer and their a law unto themselves....... PEOPLE NEED TO RISE UP!!

[cq_tech]

For a long time my bank (CBA) was charging the same 2.5% fee on international commercial transactions as Paypal, then when the bank increased that fee to 3% last year, it was actually cheaper for me to pay for international purchases via Paypal.

However, I'm very pleased that you corrected my obsolete information above DG, as it is now cheaper for me to pay for overseas purchases using my Mastercard instead of Paypal, by between 0.5% and 1% (which isn't very much in the grand scheme of things, but it's still better in my pocket than theirs). 😉

The only thing I'm not clear about now is what fees would be payable if I was to use Paypal with funding from my credit card instead of my bank balance for a purchase from the US.

Surely I wouldn't be slugged with a 3.5% surcharge from Paypal, plus another 3% from my credit card provider. Or would I?

I'm not all that inclined to make a test purchase simply to find out for myself.

[k1ooo-slr-sales]

if you buy something from the USA and use PayPal to pay for it then PayPal work out the currency exchange (including their fee) and then debit your account the Australian dollar amount of the transaction.  Because PayPal are withdrawing A$ there is no currency exchange fee from your bank.