Understand PayPal fees in Malaysia

Yumiko Kijima
8 minute read

PayPal is a quick, safe and convenient way to shop online and send or receive payments. You won’t need to enter your card details every time you visit an ecommerce store, and transferring money to family and friends is simple.

If you use PayPal for local online shopping and making personal domestic payments, you may not pay extra fees for the services PayPal provides. However, if you use your Malaysian PayPal account internationally, or if you’re a business customer, there are some fees you need to know about.

This guide will walk through all of PayPal Malaysia’s key costs, and offer a smart way of cutting PayPal’s currency conversion and international payment charges, by using Wise. Let’s dive right in.


Table of contents

  1. PayPal Personal account (Buyer) fees
  2. A cheap and transparent alternative: Wise
  3. PayPal Business account (Seller) fees

Sending money to your friend/family overseas? Watch out for PayPal’s exchange rates

We will start by looking at one key PayPal cost - sending money overseas.

Check out this example: Sending 5,000 MYR (including the transfer fees) to your recipient’s account in USD

Provider Transfer fees Exchange rates Recipient gets...
paypal-logo-my PayPal¹ 0 MYR Exchange rate PayPal decides (1 MYR = 0.2254 USD) 1,127.05 USD
tw-logo-my Wise² 30.89 MYR Real exchange rate (1 MYR = 0.235488 USD) 1,170.17 USD Send money

(June 11 2020, at 14:44(GMT+2))

This illustrates why it’s important to look beyond the transfer fee listed by international payment providers - and check out the exchange rates used too.

In this example, PayPal doesn’t charge an upfront transfer fee. Instead, their costs are included in an exchange rate markup. This means your recipient gets less - and as the sender, you’ll struggle to see exactly what you’re paying for the transfer.

Take a look at Wise as a comparison. Wise offers international payments which use the mid-market exchange rate - the one you’ll find on Google - with no markup. There’s a straightforward and transparent transfer fee to pay - and in the end, your recipient gets more in the example above.

Send money with the real exchange rate🚀

PayPal Personal account (Buyer) fees

If you use PayPal Malaysia for personal use, you won’t pay a fee for most transactions made using MYR. However, you need to be careful if your transaction needs a currency conversion, as PayPal’s exchange rate might be a costly surprise.

Here’s a summary of the personal fees levied by PayPal. We’ll look at each situation below thoroughly.

  1. Send payments - Free (+ Currency conversion fee 3.5%-4%)
  2. Shop online - Free (+ Currency conversion fee 3.5%-4%)
  3. Receiving payments - Free (+ Currency conversion fee 2.5%)
  4. Withdrawal fee - Free (400MYR or more withdrawn), 3 MYR (less than 400 MYR) (+ Currency conversion fee 2.5%)
  5. Converting currencies in your PayPal balance - 2.5%

Send payments

Sending a payment in MYR is free for the sender - but the recipient might have to pay a fee. If the payment is made in a different currency, there’s a conversion cost to cover. Here’s what PayPal says about the costs of sending payments:³

“You don’t need to pay a transaction fee when you send payments with PayPal. The recipient covers that. If you send a payment overseas in a different currency, a small conversion fee applies.”


  • Sending 5,000 MYR to a friend in Malaysia, who will receive in MYR
    = Free
    Neither you nor your friend need to pay a fee.

  • Converting 5,000 MYR to USD and sending it to a friend in the USA
    = 3.5% markup on the exchange rate used⁴.
    This means you’re actually paying 3.5% of 5,000MYR (175MYR) as a currency conversion fee. Your recipient receives the equivalent of about 4,825MYR in USD.

PayPal’s currency conversion fee: How does PayPal decide exchange rates?

If any transaction requires currency conversion - when you’re sending money overseas, or shopping online at a retailer based abroad for example - PayPal will set the exchange rate used.

PayPal’s exchange rate is called the transaction exchange rate. Here’s what PayPal says about how the transaction exchange rate is calculated:⁵

The transaction exchange rate is adjusted regularly and includes a currency conversion fee applied and retained by us on a base exchange rate to form the rate applicable to your conversion.”

What this means is that PayPal takes the base exchange rate, and adds a markup - known as a currency conversion fee - to create the exchange rate that they offer customers.

If you have a PayPal Malaysia account, the currency conversion fee PayPal adds will be 3.5% - 4% when sending money. When you receive foreign currencies, or convert currencies within your balance, 2% is added to the base exchange rate.⁴

Here’s the full currency conversion fee listing for reference:

When you convert MYR into [currency] Fee:
Australian dollar 4%
Brazilian real 4%
Canadian dollar 3.5%
Czech koruna 4%
Danish kroner 4%
Euro 4%
Hong Kong dollar 4%
Hungarian forint 4%
Israeli new shekel 4%
Japanese yen 4%
Mexican peso 4%
New Zealand dollar 4%
Norwegian krone 4%
Philippine peso 4%
Polish zloty 4%
Russian ruble 4%
Singapore dollar 4%
Swedish krona 4%
Swiss franc 4%
Taiwan dollar 4%
Thai baht 4%
UK pounds 4%
US dollar 3.5%
When you convert currencies within your PayPal balance; when you withdraw different currencies into your MYR bank account; when your sender sends in different currencies but you want to receive in MYR Fee:
All currencies 2.5%

Shop online

Shopping online with sellers based in Malaysia will not normally incur a fee from PayPal. However, shopping with merchants based abroad, or when using a card might mean you have to pay a charge.

Here’s what you need to know:⁶

When you buy something from a seller who accepts PayPal, you don't pay a fee to PayPal. If PayPal performs a currency conversion for your purchase, PayPal's transaction exchange rate (including our currency conversion fee) will be used. Your credit card or debit card issuer may also charge you a separate fee for transactions.”

Receiving payments

Receiving a payment in MYR from friends or family should not cost you anything.

If you receive a payment in a currency other than the one your PayPal account is configured to hold, you may pay a currency conversion fee before you receive the money:⁷

Certain currencies can only be received by converting the balance into another currency that PayPal allows you to hold. If the balance is converted, PayPal's transaction exchange rate (including our currency conversion fee) will be used.


  • You have a PayPal balance in MYR and receive 5,000 MYR from a friend in Malaysia
    = Free
    Neither you nor your friend need to pay a fee.

  • You have a PayPal balance in MYR, but your friend in the USA sends 1,000 USD
    = 2.5% markup added to the exchange rate.

When you convert 1,000 USD to MYR, PayPal’s currency conversion fee (2.5%) will be deducted from the amount you receive.

Withdrawal fee

Withdrawing your balance is free if 400MYR or more is withdrawn, but you’ll pay 3 MYR if you want to withdraw less than 400 MYR.⁸

It’s worth noting, though, that if you have other currencies in your PayPal balance, and want to withdraw it to your bank account in MYR, PayPal’s currency conversion fee will be applied.⁴


  • You have a PayPal balance in MYR and want to withdraw 1,000 MYR to a bank account
    = Free

  • You have a PayPal balance in USD and want to withdraw 1,000 USD to a Malaysian bank account
    = 2.5% (25USD) conversion fee will be deducted

Converting currencies in your PayPal balance

You can hold different currencies in your PayPal balance, but you need to know that there’s a 2.5% currency conversion fee when you switch currencies.⁴


  • You have 1,000 USD and want to convert to MYR in your account.
    25 USD(2.5%) will be deducted, so you’ll get MYR which is equivalent to 975USD.

💡A cheap and transparent alternative: Wise

Take a look at the low cost international transfers available from Wise, to see if you can save.

Wise uses low, transparent fees without any mark-up on exchange rates. You can send money overseas from Malaysia to 80+ countries with the real exchange rate.

If abroad, you can also receive money to your own multi-currency account from the UK, US, Australia, New Zealand and any Eurozone country, as if you had a local account there. Hold dozens of different balances all in the same place, and switch between them using the mid-market exchange rate whenever you need to. You’ll only ever pay a low, transparent fee. You can get a Wise debit card, too.

To send money with Wise,

  1. Register for free
  2. Choose an amount to send
  3. Add recipient’s bank details
  4. Verify your identity
  5. Pay for your transfer by bank transfer or debit/credit card

And that is it! You can track your transfer in your account and your recipient will also be notified when a transfer reaches them.

Join over 11 million customers and experience a cheaper, faster way to send money abroad. From Malaysia, you can send money abroad up to 7x times cheaper than banks.

PayPal Business account (Seller) fees

PayPal can also be used for businesses. In this case, you might find you face different fees compared to the personal account costs described above. Here’s a summary - we’ll dive into these fees in more detail in a moment;

  1. Receiving payments - 3.9% + 2 MYR (from Malaysia), 4.4% + $0.30 USD (from elsewhere) (+Currency conversion fee 2.5%)
  2. Send payments - Free (+ Currency conversion fee 3.5%- 4%)
  3. Withdrawal fee - Free (400MYR or more withdrawn), 3 MYR (less than 400 MYR) (+Currency conversion fee 2.5%)
  4. Converting currencies in your PayPal balance - 2.5%

Receive payments

Here’s what PayPal say about their charging policy for business payments:⁹

“There are no set-up or monthly fees. We simply charge a small fee based on your total sales volume. The more you sell, the lower the fee.”

As you can see from the table below, fees vary according to the volume of sales and where your customers are based.

It’s worth noting that the fixed fee for international payments varies according to the country you’re selling in - and there may also be an additional currency conversion charge to pay when you sell overseas. This will also apply if you take payments in a foreign currency, but then convert to MYR to withdraw to your regular bank account - more on this later.

Monthly sales Malaysian customers International customers
Up to 12,000 MYR 3.9% + 2 MYR 4.4% + 0.30 USD
12,001 MYR - 40,000 MYR 3.4% + 2 MYR 3.9% + 0.30 USD
40,001 MYR - 70,000 MYR 3.2% + 2 MYR 3.7% + 0.30 USD
70,001 MYR - 400,000 MYR 2.9% + 2 MYR 3.4% + 0.30 USD
Over 400,000 MYR 2.7% + 2 MYR 3.2% + 0.30 USD

Send payments

Like personal accounts, it’s free to send payments, but PayPal’s currency conversion fee will apply if you need to convert from MYR to USD for example.

Withdrawal fee

We mentioned above that you may pay a fee to withdraw foreign currencies to your normal MYR bank account. That’s because of PayPal’s currency conversion fee.

In effect this means that to withdraw a currency, you need to pay the conversion fee to switch the amount within your PayPal account - 2.5% - before you can send the payment to your MYR bank account. So if you have 1,000USD, you’ll end up with MYR which is equivalent to 975 USD in your bank account.

Converting currencies in your PayPal balance

As with your personal PayPal account, a currency conversion fee of 2.5% will be deducted if you want to convert one currency to another within your PayPal balance.

PayPal is globally popular for good reason. It’s easy and convenient to shop online and make payments with PayPal - however, there are fees you need to know about, especially if you use PayPal for international transactions.

Take a look at the exchange rates and fees over at Wise, if you’re looking for a simple online way to send money to friends and family overseas, or to settle an international business invoice. You might find you can save.

Join Wise for free🌏

Wise for sending money


  1. Simulation on PayPal account page (June 11 2020, at 14:44(GMT+2))
  2. Simulation on Wise (June 11 2020, at 14:44(GMT+2))
  3. PayPal | It’s free to send payments.
  4. PayPal User Agreement | Fees and Fees Table See “Malaysia” in “3. Additional Fees”.
  5. PayPal User Agreement | Fees and Fees Table See “How we convert currency”
  6. PayPal User Agreement See “Fees”
  7. PayPal User Agreement | Managing Your Balance in Multiple Currencies See “Receiving payments”
  8. PayPal | Multiple easy withdrawal options
  9. PayPal | Seller Fees

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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