Online Exchange Rate Gotcha’s - Sat, 1 Nov 2008

Be careful when purchasing software online if its price is listed in a currency that is not your own. It is most convenient to let them convert the software price to your currency. And you should expect a good conversion rate, but sometimes they pad it.

I went to purchase my upgrade to ElPack from LMD’s order page. They are a German company and the upgrade is listed at 109 Euros. Click on the “109″ and it takes you to their Shareit vendor’s page and as I write this, it lists the price as $193 Canadian. Thats a 1.7706 exchange rate and seems a little high. I change it to US currency and it gives $149.36. That’s 1.3703 from Euros to US$. By comparison, go to Yahoo Finance’s Currency Converter and the equivalent rates on this day are: 1.5474 and 1.2734. Through Shareit, I’d be paying rates that are 14.4% and 7.6% higher than posted exchange rates.

A small conversion fee of a few percent is expected. You pay it on your credit card and in banks. But to pay 14.4% to get from Euros to Canadian dollars is a bit excessive. Fortunately for me, they allow paying by PayPal. PayPal today gives rates of 1.5845 to go Euros to Canadian. This is just 2.4% higher than the posted exchange rate. That is good.

I purchased my ElPack update a couple of days ago for 99 Euros (they gave me 10 off for being a TRichView owner in a partner program) and through PayPal I paid $160.26 Canadian. If I would have paid directly through ShareIt, it would have cost me $175.30. That’s $15 in my pocket instead of in ShareIt’s.

So I thought I’d check what Plimus’ conversions do to people who are purchasing Behold. Behold’s current pre-release price is $20 US. Go to Behold’s Buy Now page and for today’s rates, that converts to 16.38 Euros or $25.51 Cdn. This gives 0.819 to go US$ to Euros and 1.2450 from US to Canadian$. The exchange rates today are 0.7853 and 1.2151. So at least at this snapshot in time, Plimus is charging 4.3% for the US$ to Euro conversion and 2.5% for the US to Canadian$. That is not too bad.

But be warned. When you buy products online in a foreign currency, don’t overpay. If the difference is too great, then pay them in their currency and use either PayPal or your charge card (check what your charge card charges first) to do the conversion.