The devil you know, or the devil you don't?

March 28, 2007 8:42 PM

You have an online business in Canada and you have this choice: accept U.S. payments via Paypal in the U.S. dollar account you have (with a Canadian bank) and have the bank make the currency conversion to Canadian dollars, or letting Paypal handle the conversion directly. Which do you choose (and why)?
posted by zadcat to work & money (2 comments total)

Where is your market? My online business's market is the US, so I price in US dollars. Pricing is part of your marketing strategy and does have psychological effects on buyers.
posted by acoutu at 10:05 PM on March 28, 2007

I don't know if Paypal's policy has changed but when I tried had this same problem (and wanted to exchange the funds through my bank because they had a better rate than Paypal did), Paypal would not allow me to add a USD denominated account from a Canadian bank to my Paypal account. If this is still the case (and I don't doubt it is because Paypal likely makes a bundle on their exchange rate), then your choices are either to let Paypal do the conversion (add their rather poor rate) or set up a US-based USD account (and benefit from your bank's better rate). If you happen to bank with RBC, the latter option is relatively easy because they have a subsidiary in NC who can set up an account from which you can easily transfer funds (i.e. online). Other banks may have a similar set-up.

Also worth noting is that you will likely get a better rate from your bank if you exchange more than $1000 at once.

Of course, all this is moot if you are only dealing with small amounts, in which case it will be much easier to just let Paypal take their cut.

Email is in the profile if you want more details.
posted by ssg at 10:24 PM on March 28, 2007