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[PayPal] benefits of using $ from a USD account vs. Credit Card?

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Nov 7, 2013
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[PayPal] benefits of using $ from a USD account vs. Credit Card?

sorry, the subject line might be a bit unclear. i swear there was a thread somewhere on RFD that broke this down, but i can't for the life me find it.

here's the situation:

my PayPal account has a Canadian credit card and an E-Savings USD account at RBC linked to it.

are there any benefits to:

1. transferring money from the e-savings USD account to my PayPal balance, and then making purchases that way?

2. having PayPal pull the funds from the E-Savings USD account directly?

3. straight up using a Credit Card?

if 1. or 2. would i save on any conversion or other costs or fees? i believe my CC would double the manufacturer's warranty by two years, but then i'll need to pay forex, etc.
16 replies
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Jan 9, 2011
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You're lucky you already have an account with RBC, RBC makes it easier than most banks to add a USD account to PayPal. https://melissajclark.ca/usd-paypal-cad/

Best would be to get a credit card that doesn't charge you extra—or better yet, rewards you—for making purchases in a foreign currency. Add that card to PayPal, and then make sure you opt to have PayPal bill the card in the currency of the purchase, instead of Paypal converting it CAD for you at their horrible rate.
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thx for that link! had to remind myself what kind of hoops PayPal makes us jump through.
Deal Expert
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Jun 27, 2004
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Your question isn't comparing the same things.

Credit card is better than "cash", due to usually adding some kind of buyer protection.
No currency converting is better than currency converting, due to fees when converting.

One thing I like about Aliexpress is the choice to pay in CAD, or one of the numerous currencies you can choose from.
Deal Addict
Jul 5, 2006
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If you are making a purchase from the States, the product is likely carrying a US warranty which voids your Canadian credit card's wanrranty benefit (for Canadian warranty only). Without this benefit, credit card is not as attractive as it looks. Visa has worse currency exchange rate than your local banks and most credit cards take additional 1-3% fees on top of it. The only benefit is perhaps the coverage for lost or stolen goods and some miles/cash you may get.
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Apr 13, 2010
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ZoomZoom2006 wrote: the product is likely carrying a US warranty which voids your Canadian credit card's wanrranty benefit (for Canadian warranty only). Without this benefit, credit card is not as attractive as it looks.
Don't assume this. If you're concerned about this, read your credit card agreement. If this is true, it will say so in there.
Gabe of Gabe's Hacks
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cybersaga wrote: Don't assume this. If you're concerned about this, read your credit card agreement. If this is true, it will say so in there.
It says clearly in my TD visa it covers Canadian warranty only and my visa signature card with Chase says the same it works with US warranty only.

What’s in yours? Is it country specific?

I want to be wrong.
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ZoomZoom2006 wrote: Visa has worse currency exchange rate than your local banks and most credit cards take additional 1-3% fees on top of it. The only benefit is perhaps the coverage for lost or stolen goods and some miles/cash you may get.
Visa's conversion rate varies between 0.1% and 1%, a RFDer sampled it daily for a year and found it was, on average a 0.4% markup over mid-market. MC's was better, about 0.2%. You won't find any bank that will give you a cash exchange rate that good. Nearly all Canadian credit cards charge a 2.5% markup on top of that, but there are a handful that either don't charge a markup, or give you rewards that more than make up for it. Check the link in my sig for a list of them.

I have HSBC World Elite Mastercard, which charges no conversion fee over MC's own fee, and gives 1.5% cash back.
I also have Rogers World Elite Mastercard, charges 2.5% conversion fee but gives 4% cash back on foreign, so also net 1.5% cash back.

Either of those is better to use on PayPal than a US dollar bank account, which won't return any rewards.
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I haven't looked at mine since it doesn't bother me.

As long as it actually says it in yours cool, but everyone else should check theirs if they care too. There's always a chance it's different.
Gabe of Gabe's Hacks
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Kiraly wrote: I have HSBC World Elite Mastercard, which charges no conversion fee over MC's own fee, and gives 1.5% cash back.
I also have Rogers World Elite Mastercard, charges 2.5% conversion fee but gives 4% cash back on foreign, so also net 1.5% cash back.
Sounds like better cards than my TD Cashback Infinite....
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Jul 5, 2006
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cybersaga wrote: I haven't looked at mine since it doesn't bother me.
As long as it actually says it in yours cool, but everyone else should check theirs if they care too. There's always a chance it's different.
Right, everyone should carefully go over his/her agremment in detail. I almost got fooled. I was planning to keep using my Chase card in major purchases in Canada until I caught this line and called Chase to confirm.
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ZoomZoom2006 wrote: Sounds like better cards than my TD Cashback Infinite....
For purchases in a foreign currency? Nearly all Canadian cards ding you for that.

Check my thread here for what's best to use: https://forums.redflagdeals.com/list-cr ... s-2122295/
Deal Expert
Aug 2, 2004
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The best credit card for USD purchases is hands down the Rogers World Elite.

It offers 4% cash back which covers the 2.5% transaction fee netting you 1.5%
Deal Expert
Feb 7, 2017
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Believe most folks here are just talking about Credit Cards in Cdn Currency

RBC also offers Credit Cards in US Funds... (As do several other Cdn Banks)

Look at the RBC US Dollar Visa Gold

http://www.rbcroyalbank.com/credit-card ... -card.html

Which offers Travel Insurance, and RBC Rewards. Perfect Card for the Average Joe or Jane who goes to the USA on regular vacations, or shops online

They also offer RBC US Credit Cards, that are affiliated with their US Banking Network... if you qualify for as a Cdn with a US Bank Account

https://www.rbcbank.com/cross-border/us ... cards.html

Perfect Card for those who perhaps go to the US a lot, on business or pleasure

At any rate... RBC is as far as I know the one Cdn Bank that is offering REWARDS on their US Currency Credit Cards
Most Cdn Banks Offer NO PERKS for US CCs

PayPal certainly is secure for the unknown... but these Credit Cards are awesome IMO
Perfect combo... PayPal linked up to one
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Kiraly wrote: I have HSBC World Elite Mastercard, which charges no conversion fee over MC's own fee, and gives 1.5% cash back.
I also have Rogers World Elite Mastercard, charges 2.5% conversion fee but gives 4% cash back on foreign, so also net 1.5% cash back.

Either of those is better to use on PayPal than a US dollar bank account, which won't return any rewards.
good post. thanks for the additional clarification re: banks. my USD RBC account is basically of no benefit in relation to PayPal.

due to laziness, i haven't upgraded from my Fido to the Rogers WE, so i'll get 3% cash back, netting .5%.

better than a punch in the face ...
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PointsHubby wrote: Believe most folks here are just talking about Credit Cards in Cdn Currency

RBC also offers Credit Cards in US Funds... (As do several other Cdn Banks)
The problem with USD credit cards is that the bill must be paid in USD. So they're best for Canadians who have USD income or can otherwise get USD on the cheap. The rest of us will still be stuck paying a conversion fee, but instead of at purchase time, it'll be when you buy the USD you need to pay the bill.

Even if you do have USD income, the $65 annual fee kills the deal for the RBC USD card. Why pay that when you can just get a Canadian card that gives a better return for USD purchases, with no annual fee?
Deal Fanatic
Aug 15, 2003
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I have Paypal in US currency but they won't let me add a USD Bank Account registered in Canada..... USD Bank Account must have US Address attached to it so I am SOL.

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