Transfer Money from US to Thailand via PayPal: Can Be Cheaper Than Through Your Bank

thai baht notes coins

As a current resident of Thailand, every month I take money out of my US bank account and use it to pay bills in Thailand. Recently, I discovered it was cheaper to transfer money from the US to Thailand using PayPal instead of my American bank account. Why?

Because the cost of transferring money overseas via PayPal is less simply because PayPal’s fees are less. In fact, if you’re one of those Americans who currently live in Thailand, setting up your PayPal account to enable you to transfer money directly into your Thai bank account can save you hundreds of dollars a year. Here’s how.

Average American Banking Fees – Where, once, many American banks used to allow you to withdraw money overseas from your US bank account via ATM for free, nowadays most are charging exorbitant fees. Add onto that the fee Thai banks also charge per ATM withdrawal, and the cost of getting access to your money in Thai baht can be ridiculously high.

For instance, I used to be able to withdraw money via ATM anywhere in Asia from one of my American bank accounts for an extremely low cost. Around $1 per withdrawal, I didn’t mind paying a nominal fee, as the convenience was worth it. But, two years ago, my bank increased its fees to such an extent I rarely use them for anything.

The fee for an ATM withdrawal in Thailand from my US bank account overnight increased to 2% of the amount I withdrew, which meant my nominal $1 fee suddenly skyrocketed to $12 if I withdrew $600. Do you think I was going to pay that? Not a chance.

Then add on the $5.50 charge every Thai bank now charges for ATM withdrawals from overseas banks and, for every $600 I changed into Thai baht, my cost was $17.50. With an average of four withdrawals a month, per year the fees I would pay to my American bank would be more than $800. Nope, sorry, that’s never going to happen.

But, step in PayPal, who offer an easy way to transfer money from an American bank account directly to your bank account in one of many approved foreign countries, including Thailand.

Transferring Money Overseas Via PayPal – If I transfer money to my Thai bank account via PayPal, unlike my bank, PayPal doesn’t charge any fees. Not if you exchange more than around $150 per time.

Of course, PayPal’s exchange rate is lower than my American bank’s exchange rate but, even factoring that into my charges, transferring money directly into one of my Thai bank accounts is cheaper. Add onto that, my Thai bank also doesn’t charge their $5 ATM fee and, suddenly, my cost to transfer US dollars to Thailand is drastically reduced.

From a $17.50 per transfer fee via my useless American bank account to transferring directly from my PayPal account, my costs decreased to less than $3. Per year, that’s around $120 I’ll pay to PayPal versus over $800 to my American bank. It doesn’t take a rocket scientist to figure out which service I’m using.

Negatives to Transferring Money To Thailand Via PayPal – Of course, like any service with any financial institution nowadays, when you’re trying to get access to your own money, there are a couple of negatives to transferring money from the US to Thailand via PayPal.

1) Time It Takes Is Longer
– Whereas I can access my money immediately via my US bank account by simply using my ATM card, if I transfer it to Thailand via PayPal it takes around four days to a week before it appears.

As long as you know that in advance though, you can plan ahead and still have access to your money in Thailand whenever you need it.

2) PayPal’s Customer Service Is Dismal – Known worldwide as having just about the worst customer service you can get, PayPal often isn’t much help if you have problems with your money transfer. That’s why, if I transfer money to Thailand via PayPal, I always have a back up plan. Just in case. Having said that though, so far I’ve never had a problem.

Overall, I am not a PayPal fan. However, as they’re currently cutting my fees to almost 1/10th of what I’d pay my useless American bank, for now, PayPal is the service I’ll be using to transfer money from the US to Thailand. You might want to do the same.

More Information:

International Payments Via PayPal