The expensive part of paying abroad is who converts the currency, because that is usually where the money goes.
Everything below comes from PayPal’s own United States User Agreement, the binding document.
The conversion spread
PayPal’s transaction exchange rate includes a currency conversion spread that PayPal applies and retains on top of a base exchange rate.
It does not show up as a fee. A service can advertise no transaction charge and still make its margin here, so comparing headline fees between payment methods tells you little on its own.
Paying by card: PayPal converts, not your bank
When you pay with a debit or credit card through PayPal and a currency conversion is needed, PayPal performs the conversion instead of your card issuer.
If you chose that card because your bank gives a good rate on foreign spending, routing the payment through PayPal can take that benefit away.
If you pay from your PayPal balance or a linked bank account, PayPal always performs the conversion.
Sending money to friends and family
When you send money to a friend or family member using a credit card, your card issuer may charge an additional cash advance fee.
Cash advances typically start accruing interest immediately, with no grace period, so splitting a dinner bill this way can cost considerably more than it looks.
A transfer funded from a balance is not a cash advance and cannot quietly become one. Send it on a rail that shows the fee before you confirm and the cost is a number you agreed to, not one that appears on next month’s statement.
Buying from a seller
PayPal does not charge the buyer a transaction fee when you purchase from a seller. If PayPal performs a currency conversion on that purchase, the conversion charge still applies.
Refunds, balances and withdrawals
Refunds. If PayPal converted currency for a purchase and it is refunded within one day, the original exchange rate is reused. After that you are exposed to the rate having moved.
Insufficient balance. If your balance in one currency is not enough for a payment in another, PayPal may convert from another currency you hold to cover it. This matters if you deliberately keep several currencies.
Withdrawals. Funds held in a currency other than US dollars must be converted to US dollars to withdraw, at PayPal’s exchange rate including the spread.
Limits of this page
This covers PayPal’s US agreement only. It is not a comparison of payment methods across Asia, and it leaves out Alipay and WeChat Pay for foreign visitors, because we could not find a current official source for those that stands up. When one exists, we will write it.
The card side is a separate question: what the Wise card is free for and where it charges 2% covers spending, e-wallet top-ups and cash, which are three different fees rather than one.
Where the conversion is visible
PayPal’s User Agreement, under How we convert currency, states that its transaction exchange rate “includes a currency conversion spread applied and retained by us on a base exchange rate to form the rate applicable to your conversion.” Wise uses the mid-market exchange rate and shows the fee separately upfront, so you can see the cost before you send.
Which option is cheaper for a given transaction varies by currency pair, amount, payment method and date. By its own published figures Wise sends to 70+ countries in local currency and holds 40+ currencies.
Wise approved this comparison in writing on 10 September 2026, under the prior-approval rule in its Partnership Program Guidelines. We asked before publishing, and the PayPal half is quoted from PayPal’s own agreement rather than characterised.
We earn a commission if you open an account through that link, and the paragraph above is what we would write without one.
See what Wise supports and how it shows the conversion (affiliate link)