PayPal Balance Swapping
Thread poster: Geoff Browne

Geoff Browne
United Kingdom
Local time: 11:49
Member (2008)
German to English
+ ...
Feb 1, 2012

As translation is a part-time activity for me, my income from translation work is relatively low. Most of my work comes from agencies in Germany and so payment is generally made to me in euros. In the past I had euro transfers sent to my bank account in the UK but the charges levied by banks are disproportionately high for the small sums involved. Therefore, more recently I have been using PayPal where I can switch funds from euros to sterling without incurring bank charges. However, this leaves me at the mercy of PayPal's exchange rates.

It seems to me that there must be translators in the Eurozone who do what I do in reverse; i.e. they convert their GBP earnings into EUR via PayPal. I was wondering, therefore, if there might be potential for freelance translators to exchange balances at mutually agreed times using the mid exchange rate, thus saving themselves the margin that PayPal extracts from them.

By way of example, let's say I have EUR 500 that I want to convert to GBP and that the mid exchange rate is 1.20. If I'm lucky I might get a rate of 1.25 from PayPal. That gives me GBP 400 whereas, if I could effect the exchange at 1.20, I'd get GBP 416.67. Similarly, someone else might have GBP 400 that they want to convert to EUR. In this case, they might get an exchange rate of 1.15 from Paypal, giving them an exchange amount of EUR 460 instead of the EUR 480 they'd get if they could exchange funds at the mid rate. By transferring agreed amounts to each other's PayPal accounts we could both save money.

I appreciate this is not without some potential difficulties. There would have to be a high degree of trust between the two freelance translators involved. Each translator has to have confidence that the other one will carry out his/her side of the bargain.

Has anyone tried this sort of thing before? If so, what sort of experience did you have?

Geoff


 

Sheila Wilson  Identity Verified
Spain
Local time: 11:49
Member (2007)
English
+ ...
Aren't there easier ways? Feb 1, 2012

Geoff Browne wrote:

As translation is a part-time activity for me, my income from translation work is relatively low. Most of my work comes from agencies in Germany and so payment is generally made to me in euros. In the past I had euro transfers sent to my bank account in the UK but the charges levied by banks are disproportionately high for the small sums involved. Therefore, more recently I have been using PayPal where I can switch funds from euros to sterling without incurring bank charges. However, this leaves me at the mercy of PayPal's exchange rates.

It seems to me that there must be translators in the Eurozone who do what I do in reverse; i.e. they convert their GBP earnings into EUR via PayPal. I was wondering, therefore, if there might be potential for freelance translators to exchange balances at mutually agreed times using the mid exchange rate, thus saving themselves the margin that PayPal extracts from them.

By way of example, let's say I have EUR 500 that I want to convert to GBP and that the mid exchange rate is 1.20. If I'm lucky I might get a rate of 1.25 from PayPal. That gives me GBP 400 whereas, if I could effect the exchange at 1.20, I'd get GBP 416.67. Similarly, someone else might have GBP 400 that they want to convert to EUR. In this case, they might get an exchange rate of 1.15 from Paypal, giving them an exchange amount of EUR 460 instead of the EUR 480 they'd get if they could exchange funds at the mid rate. By transferring agreed amounts to each other's PayPal accounts we could both save money.

I appreciate this is not without some potential difficulties. There would have to be a high degree of trust between the two freelance translators involved. Each translator has to have confidence that the other one will carry out his/her side of the bargain.

Has anyone tried this sort of thing before? If so, what sort of experience did you have?

Geoff


Hello Geoff,

I wouldn't be interested as I have bank accounts in both currencies so am quite happy to accept either.

But I'm sure there are better ways.

Can you not open a EUR account in the UK? Then you could convert at your leisure.
Do you keep a EUR balance in your PayPal account? If so, aren't there things you could buy online in euros, to save any conversion? Converting each payment into GBP, regardless of exchange rate, certainly isn't a good idea.

What about PayPal's fee for receiving payments? Each party would have to pay. Wouldn't that negate any other benefits?

Just a few thoughts.icon_smile.gif

Sheila


 

LEXpert  Identity Verified
United States
Local time: 05:49
Member (2008)
Croatian to English
+ ...
Cross-border fees Feb 1, 2012

Sheila Wilson wrote:

What about PayPal's fee for receiving payments? Each party would have to pay. Wouldn't that negate any other benefits?


Good question. Domestic transfers funded entirely by PayPal balance are free for sender and recipient. However, for international transfers a cross-border fee of 3.9% applies regardless of funding source.

My account is US-registered, so PayPal help only gives me data for domestic meaning "intra-US" and international meaning between the US and anywhere else, presumably based on the registration address of the account holder. I would think that the principle between any other countries would be the same, though.

My guess is that your plan would theoretically work between users based in the same country, but if they aren't in the same country, the cross-border fee would negate any benefit.


 

Mundabla
United States
Local time: 03:49
There are other ways Feb 1, 2012

Paypal has become a household name for accepting payment for translation. There are other alternatives such as Invoicera and Blinksale.

Both of these are online services that allow you to accept multi-currency payments as well as create and send invoices.

You can read more here: http://blog.mundabla.com/5-online-apps-for-taking-the-pain-out-of-send

Hope this helpsicon_wink.gif


 

Stanislaw Czech, MCIL  Identity Verified
United Kingdom
Local time: 11:49
Member (2006)
English to Polish
+ ...
Check it out Feb 2, 2012

I think that you may try one of these websites:

- https://www.moneyswap.com/
- http://www.currencyfair.com/

or try in Google: "peer to peer currency exchange"

Cheers
S


 


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