PayPal International Transfers

How To, Fees, Limitations and 3 Alternatives

PayPal can be used for international money transfers simply by sending money from one user to another. If you want to send money to a bank account or in cash instead, it is possible to use PayPal owned Xoom. In this post we will show how PayPal works and provide some tips to make money transfers potentially cheaper and better.

International Transfers with PayPal

I first started using PayPal for money transfers in 2008.

Since then I have used them (and many others) extensively to transfer money, get paid and be paid … and the truth is I still use them occasionally even though I know their fees are usually much higher than the alternatives.

Fortunately these days there are some excellent alternatives for every situation.
In this post I want to show you how you can best use PayPal (and Xoom) to transfer your money with PayPal.

And I will also point out some of the excellent alternatives.

Disclosure: This post may contain offers and affiliate links to save you money and it also helps us to keep providing the best information. For more information, see our disclosures here.

1. How to Send Money Overseas using PayPal

Follow these steps to make it easy to send money overseas with PayPal.

Note: Your recipient will need to open an account but they only need an email address to receive funds.

How to Send money internationally with PayPal

If you’re new to PayPal, start by creating your account. If you already have an account, you can jump to Step 6 for setting up your international transfer.

1. Go to PayPal’s website and click on “Sign Up”.

At this stage, you’ll be able to choose between an “Individual account” (for personal payments and online shopping) and a “Business account” (to pay your international employees, send invoices to clients, integrate PayPal into your e-commerce store, etc.).

2. Enter your personal details (like phone number, name, and email) and verify your email address.

3. Link your bank account, debit card, or credit card.

4. Next, PayPal will need you to verify your account with a small transfer to your PayPal wallet. This usually takes a few minutes.

When you have your account ready, you can start setting up your international transfer.

5. To begin your international transfer, go to “Pay and Get Paid” (navigation bar) → Make a payment.

6. Here you’ll see the currency you can send from and the supported currencies for international transfers (approximately 26, depending on your location)

7. Once you choose the right currency pairs and the amount, you’ll be able to see how much your recipient will get after the fees are deducted.

8. Next, you can either transfer money to your PayPal wallet or fund the transfer with a bank transfer. Other options include funding the transfer with your debit or credit card (but this can be more expensive – see PayPal International Costs and Fees below.

9. PayPal to PayPal transfers are usually instant (a couple of hours in the worst-case scenario).

10. Once your recipient receives the money in their PayPal wallet, they can hold it there or withdraw it to their bank account. If there’s currency conversion involved, they’ll also have to pay a fee (depending on the currency).

Not that there are a few limitations to sending money abroad with PayPal.

  • For one, they only support 26 currencies for international transfers and
  • You can’t send money directly to a recipient’s bank account

To address these limitations, PayPal has another service called Xoom, which supports personal transfers to 160+ countries.

With Xoom, you can also send money to a recipient’s bank account, send cash, top-up their phone, or pay utility bills (varies by country).

2. How Xoom Can Help (owned by PayPal)

Xoom can help you do things PayPal can’t and you can use your login from PayPal to access it.

For example, PayPal currently only supports 26 currencies for both personal and business payments.

However, if you need a different currency or want to send your many outside of PayPal – Xoom might be the answer.

Review of Xoom

Xoom lets you send money to 160+ countries, supports transfers directly to bank accounts, cash pick ups, phone top ups, and even bill payments.

Here’s how you can make Xoom work with your PayPal account.

  1. Already have a PayPal account? You can use your details to log in or sign up for a Xoom account.
  2. Once you’re logged in with PayPal, any eligible bank accounts or cards will also show up as payment options on Xoom. (Under Settings in the sidebar)
  3. If they don’t appear, you’ll need to link your bank account and add a card that supports international payments.
  4. Alternately, your PayPal balance will also available as an option to fund your transfer
  5. You can start sending money by choosing the receiving country from your homepage dashboard on Xoom
  6. Next, enter the amount you want to send. Here you’ll see the currency conversion rate offered by Xoom, the transaction fees, and the amount your recipient will get
  7. Click Continue to choose receiving options (cash, bank transfer, bill payment, or mobile top-up). This can vary by country.
  8. Enter your recipient’s details and click “Send”

Note: There are limits to how much you can send based on your location and the receiving country. These limits are fixed by either Xoom (based on your user tier) or by banks and agents (for cash pick up) in the receiving country.

See “Limitations” below.

You might also like PayPal Vs Xoom

3. When PayPal Works (And Doesn’t)

Works

  • Small international transfers (PayPal and Xoom)
  • Business payments and invoicing (PayPal)
  • Cash transfers to family and friends (Xoom)
  • Bill payments and phone top ups (Xoom)

Doesn’t Work

  • Sending large amounts
  • Handling multiple currencies for personal or business use

3.1 Works

  1. Both PayPal and Xoom can be convenient options for sending small amounts internationally. The flip side: they can be very expensive options PayPal international fees also tend to be pretty complex (Learn more below – “PayPal and Xoom Real Fees”).
  1. If you have a business account, PayPal lets you quickly create invoices or request payments from its online dashboard. You can also pay your suppliers and vendors abroad with your PayPal balance or through your linked bank account (or card) in 27 currencies including USD, CAD, GBP, EUR, AUD, and NZD.
  1. Xoom has tie ups with banks and third-party agents all over the world for cash pickup facilities. Recipients need to carry their ID to ensure the money reaches the right person.
  1. With Xoom, you can pay utility bills for your friends and family members if they are in Colombia, Costa Rica, Dominican Republic, El Salvador, Jamaica, Honduras, Mexico, Guatemala, Nicaragua, Panama, and Vietnam.

3.2 Doesn’t Work

  1. Transfers with PayPal and Xoom can be both expensive and complicated. Both also have services have sending, receiving, and withdrawal limits that vary by country and rolling period (daily, weekly, monthly, etc.).

    Keep reading to learn more about the fees they charge.
  1. If you’re a frequent traveller or growing global business, you need to consider alternatives for holding and managing multiple currencies as neither PayPal nor Xoom offer a multi-currency account.

We talk about our preferred alternative below.

4. PayPal and Xoom Fees (Including Hidden Fees)

4.1 PayPal Fees

PayPal’s fees typically depends on the following (it varies based on your country of residence).

The following shows the fees for the US, but it is very similar for Europe, UK, Canada, Australia and many more.

For more detail on fees especially of USA, UK, Canada and Australia – Go to PayPal International Fees

  1. Fixed fee (based on currency received)
  2. International Fee (based on amount) “Sending international personal transactions”
  3. Currency exchange fees (a percentage)
  4. Card Fee (additional for % for Cards) The fee for sending domestic transactions applies
  1. Fixed fee (based on currency received)
    PayPal offers 27 currencies for transfers and each currency comes with a specific fixed fee that’s a part of the total transfer fees.

    For example, here are the fixed fees for supported currencies when you send money overseas from the US.
CurrencyFee
Australian dollar0.30 AUD
Brazilian real0.60 BRL
Canadian dollar0.30 CAD
Czech koruna10.00 CZK
Danish krone2.60 DKK
Euro0.35 EUR
Hong Kong dollar2.35 HKD
Hungarian forint90.00 HUF
Israeli new shekel1.20 ILS
Japanese yen40.00 JPY
Malaysian ringgit2.00 MYR
Mexican peso4.00 MXN
CurrencyFee
New Taiwan dollar10.00 TWD
New Zealand dollar0.45 NZD
Norwegian krone2.80 NOK
Philippine peso15.00 PHP
Polish zloty1.35 PLN
Russian ruble10.00 RUB
Singapore dollar0.50 SGD
Swedish krona3.25 SEK
Swiss franc0.55 CHF
Thai baht11.00 THB
UK pounds sterling0.20 GBP
US dollar0.30 USD
  1. International Fee (based on amount) “Sending international personal transactions”

PayPal charges another service fee based on the amount you’re sending, usually between $0.99 and $4.99 USD/GBP/AUD/CAD.

In the US for example it is 5%. So above $100 USD/GBP/USD/GBP/AUD/CAD, you’ll pay the maximum fee of $4.99.

  1. Currency exchange fees (a percentage)
    PayPal’s exchange rate is on the higher end, compared to similar services (more on that below). PayPal doesn’t offer the interbank exchange rate and adds a margin to the rate they offer (between 3-5%).
  2. Card Fee (additional for % for Cards)
    In most countries, it’s free to send money from your PayPal balance or linked bank account. However, paying with a credit or debit card can attract a fee of 3-4%, depending on the country.

Hidden fees

PayPal has a complex fee structure that requires research to fully understand what is happing in different scenarios.

In many situations, the sender pays fees and in other cases the receiver pays the fees and often both.

For comparison, check out the Wise calculator (opens new tab).

Dig deeper into PayPal International Fees here.

4.2 Xoom fees

Xoom’s fee structure is also quite similar.

Xoom charges a fixed transfer fee as well as a margin on the exchange rate. You can get an estimate of how much you’ll pay in fees on their fee calculator, but the largest fee can be in the exchange rate they offer.

Moreover, the funding method and how your recipient chooses to get the money can also influence the fees.

Let’s take a couple of examples.

If you send $200 CAD to AUD, fund it with a debit card and your recipient chooses to receive cash you’ll pay $4.99 CAD in fees (not including currency conversion fees).

If you send the same amount, fund it with a bank transfer, and your recipient chooses to receive it in their bank account, you’ll pay $2.99 CAD (not including currency conversion fees).

BUT, if you send $200 CAD to AUD, fund it with your PayPal balance, and your recipient chooses to receive cash, you’ll pay no fixed fees – just the margin on the exchange rate.

Similarly, the fees also change when the amount increases.

The combination of all the key factors above can change how much you pay in fees when sending money abroad with Xoom.

That’s why we recommend playing around with the fee calculator before choosing the combination that works for you.

Hidden fees

PayPal and Xoom have complex fee structures compared to many alternatives. Both require research and calculations to fully understand what is happening in different scenarios.

With PayPal, the sender pays fees and in other cases the receiver pays the fees and sometimes both.

With Xoom, while the fee calculator is helpful the currency exchange also contains fees which is not as transparent as it can be.

For comparison, check out the Wise calculator (opens new tab) and you will see what fee transparency can be like.

We dig deeper into Paypal’s International Fees here.

5. Transfer Speed

5.1 PayPal transfer speed

PayPal to PayPal – instant or a few hours (also the cheapest)
Funded by credit or debit card – in a few hours to a working day (the most expensive)
Funded by bank account – 3-5 days (most of the time here is taken by the sending and receiving banks)

5.2 Xoom transfer speed

Xoom’s transfer speed depends on the funding method, the payout method, the recipient country as well as the transfer amount.

Cash pick ups or transfers funded with credit or debit cards are usually received within minutes.

Large transfers and transfers funded by bank accounts (and sent to bank accounts) take longer – 3-5 days.

6. Limitations

6.1 PayPal limitations

  • Very few currencies supported (27 currencies)
  • Can only send $10,000 per transaction
  • Fees not transparent and can be expensive

6.2 Xoom limitations

  • Limited availability – sign ups from US, Canada, UK, and Eurozone only
  • Personal transfers only
  • Limits to how much you can transfer that varies by country and rolling period (check out the full details here)
  • Complex fee structure and can be expensive

7. 3 Best PayPal Alternatives

7.1 Wise – Best for small bank transfers below $7000 USD/£4000 GBP/€4500 EU/$9500 CAD/AUD with transparent fees (also includes Multi Currency account)

It’s rare to find a money transfer company as versatile as Wise.

Wise is widely available (sign ups for 60+ countries), support many currencies (40+), and have a transparent fee structure with transfers at the mid-market rate.

You can even see the exact fees you’ll pay on their fee calculator (open new tab).

Wise also offers a multi-currency account (for both personal and business) that you can use to hold, manage, and convert between 50+ currencies, send and receive money like a local, and get a MasterCard debit card that’s great for traveling.

Check out our Wise review and Wise Multi-currency Account.

7.2 WorldRemit – Wide coverage for small cash and bank transfers below $7000 USD/£4000 GBP/€4500 EU/$9500 CAD/AUD

Like Xoom, WorldRemit is only available for personal transfers, but they have wide coverage.

WorldRemit supports registrations from 50 countries (including the UK, US, including the UK, US, Canada, Australia, and Eurozone and lets you send cash, bank transfers, and mobile wallet transfers to 130 countries in 70+ currencies.

Check out our WorldRemit Review where they also have promotions like “4 Fee Free” transfers which makes it easier to give them a try.

You might also like: PayPal to Western Union for cash although it is not as straightforward.

7.3 OFX – Best for large bank transfers above $7000 USD/£4000 GBP/€4500 EU/$9500 CAD/AUD

Sending large transfers abroad with PayPal and Xoom (or even Wise and WorldRemit) are not the best options in our view.

This is because some companies like OFX specialize in large transfers and their customer service (24/7 telephone based), services and fee structure are all based primarily around large transfers.

Check out our OFX (review) and avoid a possible $15 fee for ever.

Bottom Line

If ease and familiarity for a small personal transfer (less than a few hundred dollars) is your priority – PayPal (and Xoom) are potentially better than a bank.

However we think there are far better alternatives (above) if you want to save significantly on fees and want a better service.

Happy Money!

What are the PayPal Fees for International Transfers?

Depending on the country you are sending from and a number of other factors we identify up to four different fees including a conversion fee built into the exchange rate.

Is PayPal Expensive to Send Money Overseas?

PayPal can be an expensive option compared to many alternatives, but it does have some advantages that may make it worthwhile and they also own Xoom, which has additional advantages.

Similar Posts

Leave a Reply