I don’t think this is Monzo’s problem, but I’ve just discovered that Paypal seem to be ignoring my request to charge me in a foreign currency (in this case USD) and are charging me in GBP at their terrible rate with markup.
did you add another currency to your paypal account?
No… it’s a GBP only Paypal account. I had to manually select the option to not use Paypal’s default rate. Paypal then ignored that setting and charged me in GBP rather than USD anyway.
Just called Paypal. Turns out this is a “known issue” with them.
Did they offer to cover the loss, due to the worse exchange rate / charges?
They did actually. It was only £2 (on a USD 60 transaction), but it’s the principle…
Thanks for sharing, @evan. I’m planning to pay for some accomodation soon and I planned to use Paypal/Monzo - so this is really helpful.
Can you please explain how/where you could check that Paypal screwed up? I’ll pay extra attention to that. Screenshots would be much appreciated!
International accounts and PayPal
The first indication I had was when I checked Monzo and found the transaction was only in GBP (not a converted rate).
I then checked the transaction on PayPal and found an exchange rate there. The last time it happened I put it down to me forgetting a step, so I was extra careful to deselect the auto-conversion option.
I just made a payment in CAD through PayPal, selected the option to be billed in the currency shown on the user’s invoice & was charged £5.01, rather than the £5.20 (every little helps ), that I would have paid, if I’d let PayPal do the conversion for me
Note - I wasn’t logged into my PayPal account when I made the payment so that might have been why PayPal didn’t charge me in GBP…
Ahhhh… I might try not logging into my account next time
I stopped logging into PayPal many years ago. Always caused more problems than it helped (especially when you have a second credit card holder). I only ever treat PayPal like I treat WorldPay, Stripe, etc.: as a acquirer. They may have been the first successful online payment system, but their byzantine rules, poor customer service, and failure to develop past ‘Web 1.0’ makes them more difficult for me to deal with than ‘traditional’ payment networks.
Sorry to dig out old stuff, but did you set it for this one particular payment or as default against Monzo card on your Paypal account?
I set it for that particular transaction
I see, I asked because it wasn’t clear in original post. I was using @alexs solution, but it didn’t always work, because some of my Payments are recurring and require logging into Paypal account.
But so far, consistently worked for me setting billing currency in settings.
In Settings on Paypal account (cog wheel), Payments, Manage Pre-approved payments, then Set Available Funding Sources (link in table header), then to details of Monzo card, then, set select “Bill me in the currency listed on the seller’s invoice.” option and save setting.
I tried with my recurring payment, then with normal payments, worked perfectly five times so far. Since Monzo has better exchange than Paypal, I’m just going to leave it there.
Thanks for that info as I wasn’t aware of that setting so I must set it next time I login to PayPal
I should update it with extra info. Wall of text incoming.
I had a subscription to Hope for Paws, US based charity, $5 a month. I set it up over a year ago, it was originally funded from Barclays card, then briefly from Metrobank, then I switched to Monzo in February. I used the same trick I described in my earlier post (just 2 posts up).
So, since Feb $5 was going to HFP. I noticed in July that since April, I’ve been charged in GBP, not USD. I checked Monzo card and the setting to be ‘always billed currency of the invoice’ was removed, and not by me. So my payments looked like this:
February, billed $5 from Monzo
March, billed $5 from Monzo
April, billed GBP from Metrobank
May, billed GBP from Monzo
June, billed GBP from Monzo
July, billed GBP from Monzo
Metrobank’s card didn’t have ‘bill me in invoice currency’ setting, so it’s acceptable that April was billed in GBP.
But after that, Payments came back to Monzo, but without ‘bill me in invoice currency’ setting anymore.
I contacted Paypal and after painful month of rubbish responses, I finally managed to squeeze out more detailed response from them, see below:
Upon checking your account, it shows that on April, the payment was funded by a different card registered on your PayPal account since our internal security system would only allow this payment method to be used in this instance.
To provide one of the safest online payment services, our internal security system reviews every payment before it’s approved. Occasionally, we must change a payment method. When this happens, it’s not a reflection of you or your account activities, but rather we’ve noticed a pattern associated with higher-than-normal risk.
I can’t give you more detailed information as to why our security system changed your payment method, nor am I able to override or manually change the security settings. Please be assured that this is a standard procedure for all payments going through PayPal and it’s carried out in accordance with our User Agreement.
Since this affected the payment method, this has refreshed the information about the funding source for your subscription payment, thus, the succeeding subscription turned out to have been converted by PayPal.
In this situation, if you wish to enable again your card issuer to do the conversion when making the payment to the subscription, an workaround for that is to temporarily change the funding source of the subscription manually before the date of charge, and then select again the card you wish to use so that you can then choose to have the option of setting your card to make the conversion.
This basically means that Paypal decided that payment that had been going for 6 months is suddenly suspicious, they changed payment source without notifying me first. Not sure how/why Metrobank card was any better than a prepaid Monzo card. Then, Paypal reverted to card it should be on. In the process, they lost ‘bill me in invoice currency’ setting, also without informing me.
As a side effect (intended or not), I lost money, because obviously, Paypal exchange rate is worse than Monzo’s. I was not offered compensation, the difference was under £1 for those few months together, so I didn’t feel like I want to chase it.
TL;DR: I strongly advise to keep an eye on recurring payments from Paypal, as due to this magic , your subscription might be reverted to Paypal exchange rates for magical reasons and according to their T&C.
I removed all cards from Paypal for now. I can’t be bothered to waste time and keep an eye on that.
Just looking for some advice around this. I’ve read through the thread but am a little confused. I have a sizeable invoice to pay for a language course which has to be paid via PayPal. The invoice is in euros. If I add my monzo card to PayPal account, and select Monzo to pay the bill, will the currency conversion be down by Monzo ( preferable I assume) or by PayPal? Is there anyway to choose as this is a one off and not a recurring payment. Thanks!
I believe the link in here is still current:
- Add your card (not your bank account) to PayPal
- Visit the link in the thread above
- You should now be offered conversion options for each card on your account
- Make sure you select Bill me in the currency listed on the seller’s invoice. for each of your cards
- When you make a payment through PayPal just make sure they honour your choice: Balances and Amounts should be noted in EUR and EUR only. If they show GBP anywhere then they are about to rip you off
In my experience PayPal usually honours your choice, but it’s certainly good to be vigilant during the payment process to ensure they don’t sneakily convert to GBP somewhere…