How PayPal handles choice of currency, & currency conversion

It's interesting to look at PayPals approach to currency choice:
https://www.paypal.com/cgi-bin/webscr?cmd=p/sell/mc/mc_receive-outside

And here's their approach to inter-currency conversions:
https://www.paypal.com/cgi-bin/webscr?cmd=p/sell/mc/mc_convert-outside

Some comments on their conversion approach...

RE: The most readily available information on currency exchange rates is
based on "interbank exchange rates". Interbank exchange rates are
established in the course of currency trading among a global network of
over 1,000 banks, and are not available through consumer or retail
channels. Consumers may use these rates as a reference, but should not
expect to use interbank rates in transactions that involve currency
conversion."

JRP: Okay, so they refer customers generally to a concept, but not to
anything specific. FWIW, "Paul Volcker once noted that trade is more
affected by 10 minutes of movements in exchange rates than by 10 years of
trade negotiations."
http://www.ft.com/intl/cms/s/0/327383a2-666b-11e3-aa10-00144feabdc0.html#axzz2qIxzyWLm

RE: To obtain actual retail rates, contact your local financial institution
or currency exchange, or check the rate displayed in your PayPal
transaction.

JRP: The best they offer is a vague "ask your bank" or after-the-fact
"check the receipt".  Yet forex "noise" often has a greater range than the
profit margins vendors count on. By ensuring that vendors can choose their
preferred price stabilization index in the web payments environment,
they're in a better position to manage risk.


-- 
Joseph Potvin
Operations Manager | Gestionnaire des opérations
The Opman Company | La compagnie Opman
http://www.projectmanagementhotel.com/projects/opman-portfolio
jpotvin@opman.ca
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