As an Internet marketer, you will inevitably collect payments and PayPal is one of the better payment providers.
- fairly simple to use
- transaction fees are fairly acceptable for low transaction volumes.
Having established itself as a primary mode of payment for eBay auctions, it’s been an easy to transition to becoming a mainstream payment option.
I’d say that the PayPal it’s a reliable way of doing business in your sales volumes $5,000 a month or lower. However, once you are doing sales of at least $10,000 a month you’d want to get your own payment gateway.
I’m not quite at that level yet, so PayPal will suffice for now.
- New local currency option: Singapore dollars
This morning when I logged into my PayPal account I noticed an option to transact in Singapore dollars.
You may already know that most transactions on the Internet conducted in US dollars. So this option to transact in Singapore dollars is not that attractive unless you are already doing a lot of Singapore-based business.
From the PayPal “Mutiple Currencies” information age:
- Pay for purchases in your selected currency
- Payment is automatically converted to your desired currency
- No need to hold a balance in another currency to send a payment
- Accept payments directly in your selected currency
- No currency exchange costs when you withdraw funds to your local bank account
- Manage multiple currency payments using your current PayPal account
- Hold one currency balance and still accept payments in multiple currencies
This could be useful because you could collect local currency from buyers in your own country.
The major issue for me about PayPal is that when I want to make a withdrawal, PayPal will convert my existing US dollar account balance to Singapore US dollars (they have a practice of coverting your account balance into your native currency), even though I have a US dollar account.I haven’t done this yet but I’d expect expect that I’d lose out on the forex side of things.
I much prefer to use a services like Xe.com which offers preferential foreign exchange rates.
Another disadvantage of using plain is that when you receive payment, you will be slapped with a 5% transaction fee. There really is no way to get around this.
Given that this arrangement allows you to collect small value transactions without a monthly charge, I guess this makes for a fair trade.
- Conversion to native currency policy: A wise move?
PayPal’s practice of coverting payments to local currencies represents some inflexibility on their part because I receive US dollar cheques from various affiliate networks. I am able to deposit US dollar cheques into my banking account without any difficulty.
So why can’t the one of the world’s biggest payment provider do likewise?
After all the US dollar is the world’s most established currencies, isn’t it?
Here’s a way of getting around a loss of potential foreign exchange losses and erosion of your account balance:
- Keep an eye out for PayPal payment options, these could include services like domain names, web hosting, ebooks
- Most of the big retailers like Amazon.com, geeks.com accept payment via PayPal
- Help a trusted friend make the US dollar transaction and collect local currency from them
Having said that PayPal is one of the more established payment providers in the market and having the option available will facilitate payment by your visitors.
They also have a dispute resolution service available, so this will give your clients some peace of mind when they make payment.
It will be my preferred payment provider until my sales transactions ramp up.