So I decided last night that it was the time for me to withdraw my PayPal funds via the bank facility that they have provided. In case you didn’t know already, PayPal has now allowed direct withdrawal of funds to Malaysian banks. However, I noticed that the exchange rate for RM from USD in the PayPal system is significantly lower than the current currency exchange market rate.
Here is the currency rate as determined by PayPal when I used their internal currency converter from USD to RM.
Compare this with the current currency exchange rate as determined by the market rate at the time (using Google Calculator). The same amount was inputed for both currency exchange tools.
You will notice there is a significant difference between the two. The margin is really too significant to ignore. I do not think that banks in Malaysia will offer the very low exchange rates that PayPal offers currently to its users. Is PayPal trying to cheat its Malaysian users by marking up their exchange rates for the RM currency? Perhaps it would be a good idea to withdraw directly to a debit card from now on, as the exchange rate for a debit card is determined by VISA and not PayPal.