PayPal is one of the most common payment gateways that provide sophisticated financial services in more than 200 countries around the world. It offers an easy and quickest way of transferring and receiving money online. Also, you can purchase products from online and in-person shops using it.
Since the service is the pioneer of the electronic transaction system, both its acceptability and accessibility cover huge areas in most countries.
For example, its active registered account continued to increase in 2021, growing by nearly 21% y-o-y in the first quarter of 2020.
Taking the statistics into account, there is always plenty to know about PayPal and how it functions internationally. On top of that, if you have some sort of interest in PayPal’s uses abroad, then it is the place where you exactly wanted to be.
So, let’s find out how to send and receive money using a PayPal account from outside the US.
Transferring Funds from the US to Abroad Using PayPal
To be honest, using a bank-to-bank wire transfer system is believed to be the standard way of moving funds from one country to another. But there are times when you don’t get enough time to perform all the formalities that come with a traditional wire transfer process.
This is where PayPal saves your back by letting you move funds in the shortest possible time. As I mentioned earlier that this renowned company has its wings spread over more than 200 countries, there’s always something to know how it functions and at what cost it takes?
First of all, let us find whether the fund transfer process is hard for a user or does it require a simple operating skill to make his transaction.
To be honest, it isn’t hard at all. Perhaps, PayPal has designed its account so well that anyone with average operating skill can perform a transaction. Following a few steps after logging into your PayPal account you can complete the fund transfer.
In the PayPal app, you’ll find the ‘send money abroad’ on the ‘Send & Request’ window. Once you tap on that, you’ll see the list of countries that you want to transfer the money to. You can send and receive money from almost any European nation.
What are the options for Transferring Funds abroad?
There are two options available while transferring funds abroad. You can either target a bank account or you can also go for a PayPal account on the other end.
Well, let’s cover them one by one.
Sending Money to a Local Bank Account
First, we should talk about the non-PayPal recipient. Because things get a little tricky here. PayPal offers an option to move funds to a non-PayPal customer by using his local bank account. You need to provide his physical bank account number to pick it up from the branch or a retail point.
To make this happen, PayPal will direct you to a website called Xoom. Don’t get panicked on the redirection, because it’s safe and well encrypted by the security team from PayPal. On the website, your target account information will be taken and the transaction will take place accordingly.
But tell you what, this transaction process might turn out to be a costly one as the bank does charge higher fees for receiving money from a non-banking organization. On top of that, you should know that while you transfer funds from a PayPal account, the fees are typically on the sender’s side.
Sending Money to a PayPal Account Abroad
Now, come back to the in-network – PayPal to PayPal – transaction.
As we know that the service provider has more control over the operations this time rather than dealing with a third-party bank on the process, you’ll find everything in a well-organized way. On this occasion, you will be shown a clear picture of how much money you are about to send and how it would cost.
You need to simply put the account number of your recipient and the transaction amount that you wish to send. On the left side of your screen, you’ll be putting the sum of money. And on the right side, you will be given the option to select the currency that you prefer for the receiving account.
The good thing is – all the charges and fees will be visualized in a clear manner as well as the final amount that your recipient will get. However, you have the option to convert your currency while transferring the money.
For the conversion rate, you might develop some wrinkles on your forehead as it doesn’t come cheap. But PayPal’s fair policy will let you know how much the transaction will cause before you send it.
Currency Conversion Rate for PayPal’s Overseas Transactions
PayPal’s currency conversion rate is often controversial. When you are trying to send money to your friends or family, say from the US to the UK, a currency conversion takes place. However, if the recipient is using his PayPal account, you will be able to see how much the currency conversion is costing you.
But in case any bank or third party is involved in it, the conversion procedure will completely depend on the other side, causing your recipient to get a comparatively lesser amount than the expectation. Since you don’t know what that bank will charge, there is always uncertainty about making the transfer.
Yet, as long as the other end is also a PayPal account, you shouldn’t be worried. Because PayPal’s currency conversion calculator will assist you well to determine the exact amount your friend will be handed over. Let me depict a brief conversion scenario for you as per the recent conversion rate.
For instance, if you want to send $50,000 from the US to your friend living in the UK, he will receive around €43,338. Similarly, the US to Canadian dollar conversion would cost you as much as 3.5% of the amount that you are sending. And this conversion rate can climb up to 4% for other currencies.
Well, this is just an example from a few days back. But if you want to get an accurate calculation, you should visit PayPal’s webpage to determine the actual fee.
Withdrawing Money from PayPal for Non-US Accounts
Being the owner of a PayPal account that opened in the US, you should be relaxed. All you need to do is just attach your US bank account and transfer funds to it and make the cash out of it without any extra transfer or withdrawal fee, at least from PayPal’s side I should say.
But things get a little hard and costly when you try to withdraw money from an account that has no connection to any US bank or whatsoever. In that circumstance, you have to take it for granted that the process will be an expensive one.
You can withdraw the money by using a debit or a credit card and also if you use your local bank account to make the transaction happen. But the problem is your local bank or the cards may not deal in USD.
So, how does it happen?
Well, an automatic currency conversion will take place so that you can get the cash in your local banknotes. To be honest, the currency rate of such transactions is really high and you may have to sacrifice as much as 4% of your main amount. (But the fee is on senders’ side)
If you have a large volume then the process of card withdrawal will make you annoyed, since you can’t cash more than $2500 at a time. Each time you have to count $2.50 as the service charge of withdrawal. If you are patient enough, you can save a few bucks using the cards rather than a local bank.
But the good news is PayPal has recently come up with the feature of adding non-euro bank accounts so that you can easily transfer money to your non-us bank account without any irrational conversion fee. To do this, you have to call them to add the feature manually.
Use of Credit Cards to a PayPal Account
If you feel comfortable using your credit card most often, you can add to your existing PayPal account to make the most out of it. The process is pretty simple. You can either add it from the web browser of the PayPal app installed on your phone.
To do so, you should go to the app and look for the ‘setting’ icon placed at the top right corner of your screen. Tap on the icon and choose ‘Bank and Cards’ and follow the instruction providing you credit card information to access the feature.
Since PayPal is strongly associated with most of the online shops and retail points, it’s always a good option to activate the credit card facility to your account so that you can make any purchase easily. You can add major credit cards such as Visa and Mastercard.
Making International Payment Using PayPal
Not just transferring funds, you can also make payments using the PayPal account from home to abroad. If you want to make payment in the USA using the PayPal service, there won’t be any special procedure required to follow the transaction.
But the payment fee greatly depends on many factors. You need to visit the PayPal website to find out what are the options available for the payment. Since the cross-border transactions may need some currency conversion, it’s always wise to check the mid-market rate to confirm the best deal.
Is it possible to use the US PayPal account abroad?
Well, you may ask if you could use your account abroad or not. Say, you are on a vacation in Norway and need to make an online purchase or payment. So, would PayPal let you make the most of your US-based account to buy a gift item from the souvenir shop?
Unfortunately, the answer is ‘No’. You can’t take the privilege of using an account of a different origin other than the country you are staying in right then. But you may ask how would PayPal understand that this is being operated outside the native country?
The GPS feature and carrier that you would be using at that time will let them determine your current location to temporarily stop any kind of activity from your account as soon as you start making any move from a foreign country.
Perhaps, the PayPal intelligent team will take it as a kind of counterfeit activity and shut down your account temporarily. In that circumstance, you may need to contact the PayPal team via phone or email to bring your account back to life again.
However, if you are moving to a different country for good, you’ll need to close your existing account forever and apply for the new one as soon as you reach your destination. But in case you have dual residency, you can use up to two accounts provided that one of them is a business one.
The Bottom Line
Though PayPal lets you access comparatively to the biggest network of countries than any other digital payment services, its fees, especially when a currency conversion comes into consideration, are somewhat higher than competitors.
You can check the options like “Wise” or 2Checkout for a new taste. Indeed, they don’t have access to the level that PayPal is now providing. But they aren’t far away from making a bigger impression and take customers to their fleet.