How much does PayPal Business charge for international payments?

PayPal Business has become a go-to solution for companies that need to send or receive payments online. However, when it comes to transferring money across borders, the platform’s convenience often comes with additional costs. Understanding PayPal international transfer charges is important for any business that wants to manage fees and protect margins.

In this guide, we’ll break down what PayPal charges for international payments, examine the different types of fees, and provide real-world examples.

Types of PayPal accounts and how they impact fees

Before diving into the fees, it's worth understanding the two main types of PayPal accounts and how they differ:

1. Personal PayPal accounts are designed for individuals who want to shop online, send or receive money from friends and family, or occasionally sell items. These accounts include access to PayPal Balance, which allows users to store funds, set up direct deposit, and pay bills. While you can accept payments for goods and services, these accounts are limited in business tools and reporting.

2. PayPal Business accounts are built for merchants, freelancers, and companies. They offer tools like invoicing, custom checkouts, payment gateways, and multi-user access. Business accounts are also subject to PayPal’s full commercial fee structure, including higher charges for cross-border payments and currency conversions.

Choosing the right account type determines which fees apply, what tax reporting is available, and how customers interact with your business. For anything beyond casual use, a Business account is usually required, but it comes with steeper costs, especially for cross-border payments.

Understanding PayPal international transfer charges

When international payments are made or received through a PayPal Business account, several types of fees may apply. These include:

1. Transaction fees: These are the standard fees applied when money is received through PayPal. For US business accounts, PayPal charges 2.99% + a fixed fee (e.g., $0.49 for USD transactions) for domestic payments. For international payments, an additional 1.50% cross-border fee applies, bringing the total to 4.49% + fixed fee when accepting payments from overseas customers.¹

2. Currency conversion fees: When a payment is received or withdrawn in a currency different from your PayPal account’s default, PayPal applies a conversion rate that includes a spread of 3%–4% above the mid-market rate. This margin is one of the more significant costs for international transfers.²

3. Funding and withdrawal fees: Depending on how funds are added to or withdrawn from your PayPal account, fees may vary. Withdrawing funds to a linked US bank account is generally free, but funding a payment via a credit or debit card may incur higher processing charges.

4. Cross-border fees: In addition to transaction and conversion costs, PayPal charges an extra 1.50% cross-border fee on most international business transactions.

5. Additional service charges: Other potential charges include $20 dispute/chargeback fees, partial refund costs (where the fixed fee portion isn’t returned), and internal currency conversion fees when transferring balances between currencies in your PayPal account.

While these might seem minor individually, they can quickly add up, especially for businesses processing large volumes of global transactions. Each fee tier is designed to monetize a specific part of the payment lifecycle. The more currencies and countries a business deals with, the more fees it will likely encounter.

Let’s explore each fee type in more detail.

PayPal fees for receiving money internationally

This is a common area of concern for many US-based businesses. When an overseas client or customer sends a payment, PayPal typically deducts the following:

• Base commercial transaction fee: For US business accounts, the standard rate for receiving payments is 2.99% + fixed fee (e.g., $0.49)

• International (cross-border) fee: PayPal adds a 1.50% cross‑border fee on top of the domestic rate for all international commercial transactions.

• Fixed fee per currency: For USD transactions, the flat fee is $0.49 per transaction.

• Currency conversion spread: Converting a foreign currency payment into USD incurs a 4.00% markup over the mid-market exchange rate.

This fee structure commonly applies to freelance professionals invoicing international clients, as well as online businesses handling cross-border sales.

For example, a payment of $2,000 from a client in the UK would result in:

• Transaction fee (2.99%) = $59.80

• Cross-border fee (1.50%) = $30.00

• Fixed fee = $0.49

• Currency conversion (if applicable) = $80.00 (assuming a 4% FX margin applied to the foreign currency equivalent)

Note: This is an illustrative example. Actual costs may vary based on exchange rates and the currency used.

Estimated total PayPal fees = $170.29

In this example, $170.29 is deducted before the funds are available in your account. When applied to multiple international transactions each month, these deductions can add up quickly, reducing margins and impacting your cash flow.

Currency conversion and PayPal international charges

If a payment is received in a foreign currency and needs to be converted into US dollars, PayPal applies a currency conversion spread, not the mid-market or interbank exchange rate. For US business accounts, this markup is typically 4.00% above the mid-market rate for commercial transactions.³

This margin is built directly into the exchange rate, meaning businesses often receive less value per converted dollar.

Example:

• A client sends €10,000

• PayPal applies a 4.00% currency conversion fee

• That results in €400 lost to the exchange margin alone

• On top of that, add the 2.99% transaction fee, 1.50% cross-border fee, and $0.49 fixed fee

In total, a US business could lose 7–8% of the transaction value when combining all applicable PayPal fees.

Because exchange rates fluctuate daily and PayPal doesn’t disclose the exact rate in advance, it’s difficult to predict the total cost of any international transaction until after the funds are converted.

How international payments are received in PayPal Business

By default, international payments received in a US-based PayPal Business account are held in the original foreign currency. These funds will not be converted to US dollars until you either manually convert them or set your account to convert incoming payments automatically.

To manually convert a foreign currency payment:

• Log in to your PayPal Business account

• Navigate to the Activity tab

• Find the relevant transaction

• Follow the prompts to accept and convert the funds

Alternatively, you can update your payment receiving preferences to convert all incoming foreign payments to USD upon receipt automatically.

When a conversion occurs, PayPal applies its standard currency conversion rate, which includes a 4.00% spread above the mid-market exchange rate for business transactions. This built-in margin can result in additional costs, particularly for businesses that frequently receive payments in multiple currencies.

Hidden PayPal transaction charges to watch out for

Some fees aren’t always apparent until you review your Statement or Resolution Center carefully. Here’s what to keep an eye on:

• Chargeback (Dispute) fees

  • PayPal charges a flat fee for each chargeback when initiated through a card issuer or bank (“chargeback”) or via a PayPal claim, though the cost varies based on your dispute rate and sales volume.⁴

  • If you’re part of the Chargeback Protection program and eligible (Advanced Credit & Debit Card set up), PayPal may waive the chargeback fee for covered disputes.⁵

• Refund processing

  • While issuing a refund does not incur an additional fee, PayPal retains the original fixed fee from the transaction (e.g., $0.49 for payments in US dollars). The percentage-based portion of the fee is returned to the merchant, but the fixed fee is non-refundable.⁶

• Account funding via card

  • Although not directly flagged as a “top-up fee,” using a credit or debit card to fund payments, refunds, or withdrawals will typically incur standard card-processing fees, such as 2.99% + fixed fee in commercial contexts.⁷

Even if your volume is modest, these charges can erode your revenue month after month.

Comparing PayPal international charges by country

PayPal’s international transaction fees vary by country and currency. Here’s a quick look at how these fees can differ.

Example comparison by region/currency

These can fluctuate depending on whether the payment is funded from a balance, a linked bank account, or a card. Always check PayPal’s fee table for the latest.⁷

How Airwallex compares to PayPal’s transaction charges

Unlike PayPal, Airwallex offers:

• No fees for receiving international payments

• Competitive FX and Transfers, helping businesses save up to 80% on FX fees

• Access to Global Accounts to hold money in 60+ countries, with local account details

• Batch Payments and multi-user approval workflows

This makes Airwallex ideal for businesses that send or receive frequent international transfers.

PayPal vs. Airwallex in action

A side-by-side comparison reveals the significant impact international payment fees can have on your bottom line. Here's an example based on a US business receiving monthly cross-border payments.

Scenario: A US company receives $50,000 per month from international clients in foreign currencies (e.g., EUR, GBP, AUD), with funds converted into USD.

PayPal

2.99% transaction fee = $1,495

1.50% cross-border fee = $750

4.00% FX margin = $2,000

Total monthly cost = $4,245

Airwallex

No receiving fee

0.5% FX margin = $250

Total monthly cost = $250

Estimated annual savings = ~$47,940

Save on international payments with Airwallex

Interested in finding a more affordable way to send and receive international business payments? Check out Airwallex. 

Airwallex allows you to send money directly using our international transfers or Global Accounts. However, if you prefer to continue using PayPal, you can add your Airwallex Global Account details as a withdrawal destination to help avoid PayPal’s costly currency conversion when transferring non-USD balances. This allows you to benefit from Airwallex’s lower FX rates.

Either way, Airwallex offers FX fees as low as 0.5% to 1% above interbank rates and no fixed fee when withdrawing funds using a local payout.

PayPal international charges: Frequently asked questions

Does PayPal charge international transfer fees?

Yes. When payments cross borders, PayPal applies several international charges. These may include a 2.99% commercial transaction fee, a 1.50% cross-border fee, and a currency conversion fee (typically a 4.00% markup over the mid-market exchange rate). These charges can significantly increase the cost of sending or receiving funds internationally.

What is the PayPal international transaction fee?

For US PayPal Business accounts, international transactions typically incur a 2.99% base fee, plus a 1.50% cross-border surcharge, and a fixed fee based on the currency received (e.g., $0.49 for USD). If currency conversion is required, PayPal also applies a 4.00% spread above the interbank exchange rate. These rates are subject to change, so please refer to PayPal’s official fees page for the most up-to-date information.

Are PayPal fees higher for business accounts?

Yes. Business accounts are subject to commercial transaction rates, which are higher than fees for personal transfers. This includes additional charges for cross-border payments, making them more expensive than personal account usage, especially when receiving international funds.

How does PayPal compare with Airwallex for international transfers?

Airwallex generally offers a more cost-effective solution for US businesses. There are no fees to receive international payments, FX margins as low as 0.5%, and access to multi-currency Global Accounts. This makes Airwallex a strong alternative for businesses handling high volumes of cross-border transactions.

Is a transfer the same as a payment with PayPal?

Not always. A payment typically refers to a commercial transaction (e.g., paying for goods or services), whereas a transfer involves moving funds between personal or business accounts. Both types of activity can trigger international fees, especially if different currencies or countries are involved.

Can PayPal currency conversion fees be avoided?

Currency conversion fees can only be avoided if the payment is made in the recipient's account currency. Otherwise, PayPal applies its own exchange rate, which includes a 4.00% margin over the mid-market rate.

Sources

1. https://www.paypal.com/us/business/paypal-business-fees#additional-percentage-basedfee

2. https://www.paypal.com/us/business/paypal-business-fees#statement-13

3. https://www.paypal.com/us/business/paypal-business-fees#currency-conversion

4. https://www.paypal.com/us/cshelp/article/how-is-the-dispute-rate-calculated-and-how-do-i-avoid-being-charged-a-dispute-fee-help350

5. https://www.paypal.com/us/cshelp/article/what-is-chargeback-protection-help608

6. https://www.cardpaymentoptions.com/credit-card-processing/credit-card-processing-refund-fees-what-businesses-can-expect/#:~:text=In%20PayPal's%20case%20(and%20many,get%20the%20original%20fee%20back.

7. https://www.paypal.com/us/business/paypal-business-fees

Disclaimer: The information in this article is based on our own online research. Airwallex was not able to manually test each tool or provider. The information is provided for educational purposes only. Readers should consider the specific requirements of their business when evaluating providers. This research is reviewed annually. If you would like to request an update, feel free to contact us at [email protected].