OT: Exchange Rates, Refunds and a Dumb Question

[YesNdeed]

So I ordered a set of wheels from Starbike in Germany, and a week after ordering them I was notified, apologetically, that the wheels could not be sourced for another 7 weeks. I decided to cancel the order and was refunded the exact amount I paid in Euros, yet it appears as about $71 less in USD???

In other words, €1429 on 4/22 amounted to $1615 paid, and €1429 refunded amounts to $1544? Can someone explain how this works? The refund has not actually appeared on my account, but according to a Paypal email, $1544 is what I'm getting back.

There was also a foreign transaction fee of 12 or so dollars which was annoying enough, but...dayum! $71 for nothing is a bit of an ouch. :mad:

[Ken Robb]

I guess SOMEONE has to assume the risk of currency fluctuations. I wonder what would have happened if the value of the dollar vs. Euro had gone up rather than down as seems to have been the case based on your experience.

[pncguy]

That's got to be frustrating!

Is it your impression that the company works with PayPal and PayPal works with you? I don't know the details of using PayPal with a foreign currency, but I expect that Starbike works only in euros, so they have given you back everything they received from you. So the complaint would be with PayPal on the exchange rate.

I doubt there's anything to be done about the foreign transaction fee.

Sorry this happened to you!

[robt57]

Loss, not rip off.

Although I appreciate it feels that way.

BTW, get a CC that has no trans fees for overseas purchases if you are going to buy OS. PP did not charge the rate? by rather it was on your CC, yes?

PayPal does not control the exchange rate.

[pncguy]

I guess SOMEONE has to assume the risk of currency fluctuations. I wonder what would have happened if the value of the dollar vs. Euro had gone up rather than down as seems to have been the case based on your experience.

Now THAT is an interesting question. It doesn't seem that PayPal profited from the exchange change, but I doubt they'd have given you more than the $1615 back!

[robt57]

Now THAT is an interesting question. It doesn't seem that PayPal profited from the exchange change, but I doubt they'd have given you more than the $1615 back!

But they would have lost had they refunded at the initial transaction date rate. Not going to happen.

New term, date rate rape...


For sure NOT a dumb question either.

[YesNdeed]

I guess SOMEONE has to assume the risk of currency fluctuations.

Probably not the most expensive lesson I'll ever learn. I hadn't considered it before, obviously. It's worth it to put it out there for anyone else who hasn't considered it.

[Ozz]

Now THAT is an interesting question. It doesn't seem that PayPal profited from the exchange change, but I doubt they'd have given you more than the $1615 back!
They probably would have....

The purchase was conducted in Euros, and the exchange took place at PayPay. They probably just apply a current exchange rate and do the conversion. Since the process also probably automated no one really looks to see if the amounts match the original exchange. To keep the $$ would mean they are in the F/X trading business which means lots of licenses and scrutiny by SEC and others...not my area of expertise, but know enough to be dangerous.

It is often worth asking for prices in both the USD and Euro. Like Ken said, someone has to assume the F/X risk

[YesNdeed]

Loss, not rip off.

Although I appreciate it feels that way.

BTW, get a CC that has no trans fees for overseas purchases if you are going to buy OS. PP did not charge the rate? by rather it was on your CC, yes?

PayPal does not control the exchange rate.

I adjusted the heading appropriately. Yea, it's a loss. I'll get over it quickly.

No, it was a separate transaction that appeared on the CC charges. I have the cash and would pay it off immediately, and would think that if the funds were debited directly from my checking, there would have been no transaction fee. Maybe.

[YesNdeed]

But they would have lost had they refunded at the initial transaction date rate. Not going to happen.

New term, date rate rape...


Lol.


For sure NOT a dumb question either.

Thanks. I can't help but feel like a dope, but I'm all the wiser as a result.

[OtayBW]

I would think that in a perfect world, since they could not fulfill the terms of your sales agreement, that they would make you whole...

[ColonelJLloyd]

I believe some CC issuers have policies about charging the card before the item is shipped/prepared for shipment. If your CC was the source of the funds it's worth a call to them.

[Mark McM]

Paypal increases its currency conversion fees (https://www.monito.com/en/wiki/paypal-quietly-increased-its-currency-conversion-fees)


Based on the recent currency exchange rates, it looks like the conversion from 1429 Euros to $1544 is about right (current exchange is hovering aroung 0.925 Euros/$). But it looks like the initial payment of $1615 had an additional 4% added when converting to Euros.

[Mark McM]

I would think that in a perfect world, since they could not fulfill the terms of your sales agreement, that they would make you whole...

They did - and more. It was the buyer's decision to engage Paypal for payment service. Paypal added extra fees on top of the sellers asking price, and then only payed the seller the asking price*. When the transaction could not be completed, the seller refunded the entire selling price. However, the Paypal did not refund the extra fees they added - it wasn't their fault the sale could not be fulfulled, and their user agreement stipulated that the fees wouldn't be returned.

*In actuality, the seller actually lost a little. When Paypal payed the seller the asking price, they first subtracted out a fee. When the seller issued a refund, they had to refund the entire asking price - Paypal did not return the initial fee.

So, the buyer lost, the seller lost, and only Paypal came out ahead.

[mulp]

I think paypal is an evil company and i try to avoid them as much as possible.

In case you are interested, you can find paypal's user agreement here: https://www.paypalobjects.com/marketing/ua/pdf/US/en/us-ua-042820.pdf

The Refunds section states:

If PayPal performed currency conversion for your transaction and a refund is issued:
• Within 1 days of the date of the original payment, PayPal’s transaction exchange rate
(including a currency conversion spread) used at the time of the original payment will apply.
• Beyond 1 days of the date of the original payment, PayPal’s transaction exchange rate (including a currency conversion spread) on the date of the refund will apply.

Money will be refunded in the currency you paid; or if we are unable to refund in the currency you paid, in your primary holding currency; or we are unable to refund in your primary holding currency, then in U.S. dollars.

It seems like paypal wouldve given you more money if the exchange rate was in your favor, but i don really believe that until i see someone share their experience of that actually happening.

[Veloo]

That happened to me twice on eBay purchases many years ago. Now when I buy in a foreign currency, I try to confirm stock before completing the transactions.

What I found sellers doing on eBay was relying on their suppliers for supposed availabilty/ inventory and then when time came and there was none, they would refund my money but I'd lose out on the two way exchange rate.

[mdeth1313]

If paying through paypal with a credit card - your best bet is to choose the option that lets your bank set the exchange rate (the credit card). Paypal is a ripoff. They'll show you their rate. 100% of the time (and I've purchased from overseas more times than I can count) the credit card rate was better, oftentimes far better.

As far as the refund, I've been on both ends of that. I've received more and less. I usually won't order from overseas unless I know they have it in stock or give a specific date and I've never spent that much money on an overseas order, so the difference in refund has never been more/less than 7 usd.

The other thing is starbike is famous for that crap. They'll tell you they'll get something in, but it never happens.