Paypal currency conversion revenue
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Cross border fee structureInternational fees (using UK as representative)Guesstimated spread of what % of merchants pay each fee
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Average of weighted average fees outside and inside US3.03%3.4%75%2.55%
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$0.30/£0.20 as a % of avg transaction size:0.50%2.9%18.75%0.54375%
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International fee for sellers:1%2.4%4.6875%0.1125%
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Approxiate mark-up on currency conversion2.9%1.9%1.171875%0.022265625%
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Percentage of customers that use Paypal for conversion75%1.4%0.390625%0.00546875%
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Realised revenue after conversion40%Weighted avg fee outside US:3.23%
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Average fee contribution of currency conversion:0.87%
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Average fee revenue from cross-border transactions:5.40%US fee range (guesstimated)
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Of which, currency conversion accounts for:16.10%2.9%75%2.175%
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2.7%18.75%0.50625%
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2.5%4.6875%0.1171875%
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US fee structure2.3%1.171875%0.026953125%
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Weighted avg fee in US:2.83%2.2%0.390625%0.00859375%
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$0.30/£0.20 as a % of avg transaction size:0.50%Weighted avg fee in US:2.83%
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Average total fee revenue from transactions within the US:3.33%
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Combined average fee revenue for all transactions:3.85%Reality check to see if we're in the right ballpark.
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Actual gross profit margin:3.86%
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$m
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Paypal Total Payment Volume145,000Source: https://www.paypal-media.com/mediacenter.cfm
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Paypal revenue for 20125,600
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Cross-border revenue (i.e. 25% of total revenue)1,400
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Revenue attributable to currency conversion mark-up:225.38
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