PayPal – A guide to using PayPal in Malaysia Part 2

PayPal – A guide to using PayPal in Malaysia  Part 2

Paypal : Features and Benefits

PayPal has quite a few advantages, like these :

Easy Access

The attractiveness of using Paypal is that you can shop online with peace of mind : You can pay for purchases and send money from over 190 countries and regions! Another plus is that recipients don’t even need a PayPal account – they can sign up when they receive your payment. PayPal is accepted by thousands of businesses worldwide and is the preferred payment method on eBay. Also, it is very fast and simple to sign up for Paypal. You can use your account within minutes of signing up.

Safety

Paypal emphasises safety of data and none of your financial details will be exposed to the merchant. They claim to prevent identity theft by :

• Using state-of-the-art technology and fraud prevention models to help stop cyber crime.
• A team of over 2000 specialists worldwide including former law enforcement officials who work together with agencies around the world to prevent fraud and identity theft.
• Paypal verification system. Many account holders have verified their accounts and established an identity with Paypal.

What about your purchases? Yep, PayPal guarantees protection of your purchases as well. Paypal guarantees 100%  protection against unauthorized payments sent from your account. This is done so because Paypal sends an email confirmation of every account transaction. If you receive confirmation of a transaction you don’t recognize, their 24/7 customer support team will help you sort out the situation. If you report an unauthorized transaction within 60 days of the transaction, Paypal will cover the full cost.
Paying with Paypal also gives you access to a dispute resolution forum called Resolution Centre. There, you can file claims against these items :

• A physical good that you paid for but never received
• A physical good you purchased on eBay that is significantly different than what was described in the listing.

Disadvantages of Paypal

Fees and RestrictionsThe Underlying

There are nominal fees for several transactions offered by Paypal. Paypal fees can be considerably large if you transfer in large amounts (Business and Premier accounts). Hence, for small transfers, personal accounts may be best. While it is free for personal account holders to make or receive payments from other accounts, they have limits on the amount of money being moved. Business and Premier accounts have no such restrictions but are charged high transaction fees. Hence, Paypal takes a large percentage of the money being moved.

Locked accounts and rigid security measures

The US government has strict rules restricting the number of transactions through Paypal due to possible terrorist threats. If your account comes under the slightest suspicion, your account is immediately frozen. Paypal then has to conduct an investigation to verify the safety of your account and this could take a long time. Your money will then be frozen for a long period of time and Paypal is given complete control over your funds

Currency conversion

Payment in foreign currencies has to be converted to local currencies before transferring to your bank balance. You cannot set up a foreign currency account to avoid the conversion. These currency conversions  are carried out at credit card rates. Furthermore, Paypal’s currency basket is limited to 23 currencies. Some important currencies such as the Indian rupee are excluded.
Paypal is not supported in some countries especially developing countries where scams are prevalent.

Alternatives to PayPal for International TT - PayPal vs. Credit Cards

PayPal

With PayPal, you do not have to repeatedly key in personal details when making a payment or keep exposing sensitive financial details. This is because all your personal details are already stored on a security encrypted database with PayPal. When you pay using a Paypal account, you only have to log into PayPal and select the preferred method of payment. PayPal processes the payment without releasing any financial details to the merchant. This then proves to be safer, faster and easier.

However, there is still a possibility of theft or fraud occurring if cyber criminals are able to gain access to your PayPal account. Hence, it is advisable to have a unique password for your PayPal account in order to deter hackers.

PayPal though widely accepted, is still not accepted everywhere. There are some countries in which PayPal does not have its operations.

Credit Cards

Credit cards are accepted everywhere. Also, banks would normally have their own high level security systems to prevent theft and identity fraud. However, there is a thriving black market for stolen credit card data. If account, only online transactions can be conducted.
So what are the charges?
your credit card data is stolen, it can be used to conduct both online and offline purchases. With a Paypal

Below are a the international transfer fees for Malaysian banks :

Affin Bank

• Commission : No commission is applied for transaction amount more than or equal to RM5,000.00RM3.00 is applied for transaction amount less than RM5,000.00
• Cable Charge : Normal Telegraphic Transfer, RM30.00 is applied
• There is a maximum transaction limit of RM 5000 and each customer is limited to RM10000 a day.

Alliance Bank

• Telegraphic transfer in Foreign Currency, Payable overseas : Minimum of RM2.00 per telegraphic transfer for whatever TT amount plus cost of cable incurred
• List of cable charges:

Currency	Charges
USD	RM32.00
IDR, THB, PHP & BND	RM13.50
SGD	RM7.50
Other Currencies	RM25.00

Ambank

• Foreign Exchange/Conversion Fee is determined by MasterCard International
• Administration cost at 1%
• Retail Transaction Fee of RM1 per transaction

CIMB

• RM10 flat per transaction.

Hong Leong Bank

• Malaysia to Singapore : RM12 Per Item
• Malaysia to Other Countries : RM30 Per Item

Maybank

• Peninsular Malaysia :

Country	Charges
Singapore	RM10.00
Brunei	RM25.00
Other countries or TT covers via Singapore (excluding Foreign Worker's Telegraphic Transfer or FWTT)	RM25.00

• East Malaysia

Country	Charges
Singapore	RM15.00
Other countries or TT covers via Singapore (excluding Foreign Worker's Telegraphic Transfer or FWTT)	RM25.00
Brunei	RM6.00 or RM25.00 via online FTT system

Public Bank

• Outward Telegraphic Transfer in Foreign Currencies : RM2.00 for amount of RM5,000.00 equivalent and below plus cost of wire

RHB Bank

• Outward Foreign TT - Less Than RM5,000 : RM2.00 Service Charge (FREE for more than RM5,000)
• Cable Charges : RM25 via SWIFT / RM35 via TELEX

Alternatives to Paypal - Paypal vs. Western Union

PayPal and Western Union are different in their business models ;  Paypal tends to focus on online payments or e-business whereas Western Union focuses more on money transfers. Other differences include :

Methods of Transactions

To use PayPal, you have to have an account with them. However, Western Union can conduct transactions through agents. For example, CIMB bank has a tie up with Western Union for transfer of funds internationally.

Availability

Paypal is only available in selected parts of the world whereas Western Union is widely available (except in US sanctioned countries).

Cash Form (or others)

It is not possible to liquidate funds in your Paypal account into cash before transferring it to your bank account. However, through Western Union, your funds are easily available in cash form or any other preferred form.

Western Union – Charges

The transfer fee charges for Western Union are dependent on the different agents who might have different charges. For example, CIMB states that the service charges vary according to destination country, ranging from USD3.20 to USD110. Please check with the respective banks on their charges.

So Which one Helps me Save the Most Money?

You need to do the adequate research in order to decide what is needed. For example, if you are considering using Paypal for a small time business venture, it may be more expensive to use a business account because a large percentage is deducted each transaction and it is better to use the free transaction personal account. However, if you are using a money transfer, it may be cheaper to use a bank foreign TT service instead of Western Union because most banks charge a flat rate for wire transfers though they are slightly slower than Western Union.

It really depends what you are looking for. So, make sure to do the appropriate research before deciding on the service to use.