How does PayPal calculate currency conversion/ exchange rate?

If a currency conversion is needed for your payment, we'll use a retail exchange rate. The retail exchange rate (set by an outside financial institution) is our wholesale cost of foreign currency plus a currency conversion fee. This fee depends on the currency you are converting into. See the 'Additional Fees' section of the User Agreement for details.

Keep in mind that some of the rates quoted in the media are the inter-bank rates that are available only to the largest international banks, which purchase currencies in quantities of US $1,000,000 or more. A more applicable comparison for consumers is the exchange rates quoted at airports or other consumer currency exchange shops.

Here's how to view our exchange rates:

  1. Go to Summary.
  2. Below your balance, click Currencies and follow the instructions in the ‘Currency Exchange’ box.
  • If funds are transferred from one balance to another in an account, the exchange rate will be calculated and presented during the conversion
  • If a payment includes currency conversion, the exchange rate will be calculated and presented in the Send Money flow
  • Refunds are performed using the exchange rate which was current at the time of the original payment.