Paypal Now Converts Dollar To Naira When Making Payment
. It appears that paypal has followed the trend of other website like Facebook, Google, Amazon and lots more others that has made changes for dollar payment by Nigerian by automatically converting dollar payment to naira. What this means is that, each time Nigerians are using paypal to make payment to any website or subscription, it will be automatically converted to Naira for you to see the exchange rate you will be charged before making payment. I guess this is a good news for those who must have linked their ATM Card, either Naira Master card or Visa Naira Card from any bank because you get a chance to see the exchange rate you will be charged before making payment.
At least this gives you idea of what you will pay before proceeding to complete the payment transaction, not the other way round in which you will be skeptical to know how much they would charge you in exchange of the dollar payment when converted to naira which would end up surprising you as you may be charged higher than you expected.
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In as much as this is a good news for Nigerians, there is a rumor going round that since paypal implemented this features of automatically converting dollar payment to naira before completing any transaction, there has been a lot of failed transaction due to DCC restrictions. This is because paypal is using the official Central Bank Exchange Rate on their conversion while the bank is using black market rate and due to this, it is clashing with each other. The bank will not accept what paypal is giving to their customer thus, making it difficult for customers to make payment because once you try to use the official rate that is displayed on paypal payment page, you will get a declined payment notification in your email with a message saying your transaction failed due to DCC restriction ( Dynamic Currency Conversion
In simple terms, What this means is that, instead of your bank to charge you black market rate of maybe #400 per $1 when making payment via paypal platform, now with the new paypal features that has been added which automatically converts the dollar payment to official CBN exchange rate which is less than #400 , the bank is not willing to take that as their charges because they won't gain from it since its the official CBN rate.
Let me make it clear so you will understand better. Lets say your bank is charging #400 per Dollar and official CBN rate is 350 . Now paypal is converting the dollar payment to #350 per dollar for their Nigerian customer
. So with such rate, the bank will not accept it because it is less than what they programmed to charge your ATM Card when making dollar payment transaction. I guess you now understand why there is a problem and the reason why they usually send email with the message mentioning DCC restriction. This is the dynamic currency conversion problem most paypal customers are now having.
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