Foreign Exchange as a Service
Last updated: Feb 26th, 4:23pm
Foreign Exchange (FX) as a Service is a payment solution that offers partners and merchants the ability to display prices and accept payments in the buyer's local currency. Using PayPal's Currency Exchange API, merchants can fetch currency exchange rates and display the prices to buyers in local currencies.
How it works
The following figure illustrates the presentment of prices in Great Britain Pound (GBP) to a United Kingdom (UK) buyer visiting a United States merchant’s website. This merchant maintains a price list in United States Dollars (USD) and is integrated with FX as a Service to present the price in the buyer’s local currency.
- The merchant calls the Currency Exchange API to fetch FX rates in their currency of choice in markets where their buyers are based. Merchants can make multiple API calls or call once and cache exchange rates based on their need.
- FX as a Service returns exchange rates for the currency pairs requested, where quote currency is the currency presented to their buyers and base currency is the merchant’s preferred currency. This overall exchange rate includes a PayPal FX fee and any additional FX markup that the merchant has passed through the
quote-exchange-ratesAPI call. - When the buyer visits the merchant’s website, prices display in the buyer's local currency by the merchant.
- The buyer checks out and submits the payment in their local currency. The merchant makes a call to Orders V2 API and the transaction details are sent to PayPal for processing.
- PayPal processes the transaction and collects the transaction amount in the merchant's base currency from the buyer's financial institution.
- PayPal converts the transaction amount from the buyer's currency to the merchant's base currency using the same exchange rate as used for presenting to the buyer in the second step. Funds are deposited in the merchant’s PayPal account in their base currency.
Note: PayPal will not honor the exchange rate determined and configured at the time of contract agreement if the rate guarantee period expires before the payment transaction is captured. In this instance, PayPal converts the transaction amount to the merchant's base currency using the prevailing exchange rate.
Eligibility
Contact your account manager to determine your eligibility for FX as a Service in your country and view the supported currency list.
Buyer currencies
This feature supports presenting prices in 100+ currencies local to the buyer, also known as a quote currency. See Presentment Currency Codes supported for presenting to buyers.
Settlement currencies
The currency that a seller prefers to get the final settlement of funds is known as a base currency. Funds can be settled in 25 holding currencies. See Settlement Currency Codes for currencies supported as base currency.
Key definitions
See Key definitions to understand the different currency terms.
Account types
This feature works with business accounts.
Payment and disbursement methods
All payment methods supported by Orders v2 API are accepted. You can use immediate or delayed disbursement with this feature. See Alternative payment methods for countries and currencies of alternative payment methods supported.