Hi,  I wrote this up for some people on the Rollscanners group but
the subject has come up several times on MMD so I am sending this
to MMD as well.  I'm going to try to relate the process of sending
money internationally through PayPal.

During the exchange of ten e-mails and two phone calls to their
customer service group, I received several different answers to my
question.  I was told a variety of answers, from "You have to ask
the seller in the other country how many US dollars to send," to
"We cannot access that information; it is not available."

After a lengthy search, I was able to find a phone number for their
headquarters in California.  (No, their employees would not or could
not give me the number or address or the contact information of any of
their officers.)  I finally called their CFO and spoke at length with
their treasurer.  Very nice fellow.  By the way, he stated that they
would look at the idea of putting the conversion information on their
web site in the near future.

This description applies to their preferred/commercial accounts.  The
personal account allows for sending a small (less than ~$100) amount for
free between two people inside the USA.  The small amount rule *may*
also apply to the front end of international transactions, but I'm not
certain.  Here goes!

There are two parts to any transaction: sending and receiving.

All transactions are in US dollars.  The fee for sending money (putting
it into the system) is 2.2% of the amount plus $0.30.  So, to send $100
to someone, you have to put in $102.50.  In the USA, it doesn't cost
anything for the receiver to transfer the money out of their account
at the receiving end.

If you are sending the money to another country, there is an additional
fee at the receiving end.  The receiver has to pay a conversion and
handling fee at their end (in addition to the fee the sender pays to
put the money into the system).  The receiver's fee is 2.6% of the
total amount received.

Their conversion fee is an additional 2.9% (approximately) based on the
adder they apply to the international, large transaction bank exchange
rate found at some place like  http://www.xe.net/ucc/

Another way of looking at it is to combine these two rates and say that
they charge about 5.5% to take the money and place it in the receiver's
account in the local currency.  Adding up all that, it comes to about
an 8.2% fee to complete an international transaction.

The 5.5% conversion/handling fee compares with my local banks as
follows:

Locally they charge between 1.5% and 5.5% for a similar transaction,
depending on which bank you do business with.  The 2.2% fee to send the
money could be compared to the additional $15 to $25 fee the local
banks charge to make out a check in a foreign currency.

So, if you can get a low exchange rate at your bank (1.5% or so),
PayPal would be cheaper for transactions of less than about $250.
If you have to pay the top rate (5.5%), PayPal is cheaper up to about
$700.  Both these figures assume a $15 fee for the check; a higher fee
would move the tradeoff numbers higher.

Good luck!

Craig Smith

P.S.:  If someone wants to call PayPal and explain it to one of their
customer service people, go right ahead.   It will be news to them.
And, if I didn't write it down, in about 15 minutes it would be news
to me too.

 [ Thanks, Craig, that's the best explanation yet!  -- Robbie