How to avoid currency conversion ripoff fee? (when buying L$)

[Johnny5 Back]

I have a multi-currency bank card (Monzo), which means it can convert at great rates automatically.

However, Linden Labs forces me to pay in GBP and intentionally sets a really bad exchange rate, when I buy L$. The difference is about 5-10%!

I would be happy to pay in USD and allow my bank to convert, but I see no such option during payment.

Edited January 25, 2019 by Johnny5 Back
fix

[Arwen Starchild]

On 5/19/2023 at 1:02 AM, Alwin Alcott said:

You could try calling billing or live chat.

Also on the forums it's like the Lindens were off this week .. 

that’s the feeling I got to. I finally got an update to my ticket and was offered a full refund. I’ve cancelled my charge back with my bank and I’m quitting Second Life.

I’ve lost my mainland home because of these rip off exchange rates and it’s taken away all my motivation to continue playing. I’ve spent thousands of dollars in Second Life over the years and Linden Labs threw away all that future profit by trying to get an extra $12 off me.

Literally all Linden Labs had to do was charge the real exchange rate and they would have continued to make thousands more off me, but I guess that’s just too much to ask.

[Rolig Loon]

Not being in the UK myself, I cannot speak about bank transactions to SL from personal experience. It has always been my understanding, though, that payments in the LindeX are in USD.  That means that the conversion has to take place before your money gets to Linden Lab's doorstep.  I do know that's the way it works if you are paying through PayPal, since PayPal always gives you the option of paying in either your local currency or the target currency of your recipient.  When I use PayPal to send money to the UK, I can specify payment in USD or in pounds Sterling.  PayPal does the conversion.  If you are paying with a credit card or somehow directly from your bank, you might ask them if there's a way to do the currency conversion on their end.

[Fionalein]

That is strange, yeah - I always pay USD and have Paypal convert the money before (you can have different currencies stored in Paypal and I see no use in stashing Eurobucks - the civilisation on this side of the pond accepts bank transfers as payment... ) Sure Paypal charges for conversion - but last time I looked the fee was less than the other banks charged and far away from anything I consider ripoff (and no, 5% less? definatelly not).

If your conversion rate is so much worse with credit card switching to Paypal (or Skrill - I think LL accpeted that one as well) and buying with USD might be an option.

Edited January 25, 2019 by Fionalein

[Johnny5 Back]

Yes that's what I would have thought -- that it would try to charge in USD, and let my bank convert.

See the attached image -- I entered 10000 L$, that would be $41.33.

Linden Labs would charge me 34.78 GBP for this transaction (and when I buy it, that's really how much they charge).

The currency market rate conversion is 31.06 GBP. That is a difference of 12% !

I haven't tried PayPal, as paypal also has bad exchange rates, although probably not as bad as 12%

[Rolig Loon]

That's interesting.  As I said, I am not in the UK myself, so I have had no personal experience buying L$ from there.  That currency exchange notice does not appear on the screen when I use the LindeX here in the US.  If I'm reading it correctly, the transaction is handled by Tilia Branch UK Ltd., which is doing the conversion and charging you its own rate.  If your own bank doesn't have some way to let you pay in USD and avoid Tilia's conversion, I think you will be much better off with PayPal, which does let you submit in USD.

[Ethan Paslong]

i'm in europe too, but added USD in paypal as secundary currency, so i'm not sure this would change if i'd use Euro's €   ... i get just this:

[Ethan Paslong]

btw... here the paypal confirmation

https://gyazo.com/5c9a866917426b8a8b9ffb1da6f9e61e

and a conversion at marketrate USD to €

https://gyazo.com/a09d74d03e3c24bd7b5ef62c602e2d47

less horrible as in @Johnny5 Back 's situation

[Lindal Kidd]

Bear in mind that the UK charges Value Added Tax (VAT).  I am not sure VAT is applied in this sort of transaction, but if it is, that could explain the price difference.

[Ethan Paslong]

17 minutes ago, Lindal Kidd said:

Bear in mind that the UK charges Value Added Tax (VAT).  I am not sure VAT is applied in this sort of transaction, but if it is, that could explain the price difference.

yes, but it doesn't explain this difference, VAT in UK is 20 % in the Netherlands where i am  21% it really might be someone keeps a kinda steep exchange rate somewhere in the chain.

Edited January 26, 2019 by Ethan Paslong

[Willow Hexicola]

This is a massive annoyance for me at the moment. I almost deleted my account twice in anger when I realised LL had been forcing the currency conversion on me, and at rip off rates (I'm not even sure of the legality of that in the EU - everywhere else gives you the option of paying in USD or GBP). I'm sure a good few of my linden buys have been worse than the 12% shown above. And no - it's not VAT.

I used to always buy lindens in USD - I have a credit card that gives me the mastercard wholesale rate for currency conversion with no fees, which is basically the inter-bank rate - you can't get a better conversion rate, it's the rate you see on the news. This worked for me for years.

But for over 2 years at least now, LL have been forcing their own currency conversion on me and charging me in GBP - I only noticed recently when I looked at my CC statements whilst doing my tax return.

I have my credit card as a payment option on paypal - does anyone (not is the US please, as you're going to be charged in USD regardless) know if the paypal route works as a way around this? If I'm paying in USD using my credit card on paypal, in the past that's given me the mastercard wholesale rate, rather than the paypal currency conversion rate.

Btw - if you're in the UK, it's the halifax credit card that gives you the wholesale rate - I use it because I buy lots of stuff from abroad, in Euros or Dollars.

[Willow Hexicola]

Ok - the paypal route doesn't quite work.

I just bought 10k lindens to try it @$41.49

It should have cost 31.34 on my credit card - paypal charged my card £32.97, so it's been done on paypal's conversion rate.

Not as bad as the rate LL have been pushing on me but I'll have a word and see if this can be sorted so we get the option of paying in USD or for LL to do the conversion for us.

[Willow Hexicola]

ps. LL would have charged me over £35 - I forget the exact figure

[Pwei Morrisey]

I have Revolut and the money in the account is ALREADY converted to USD... but as my address is in Australia for some reason it keeps doing the conversion and charging a ridiculous exchange rate - if there's a way to just buy in USD that'd be much appreciated.

At this point I feel anyone outside the US is being ridiculously ripped off.

[VSwitch]

I am also questioning how the L$ rate is calculated.

I purchased L$ at USD 54.96. The current rate meant I should have paid GBP 44.95 (1.00 USD= 0.82 GBP). However, I was charged £48.96. So, where did the extra GBP 4.01 come from? I wish the currency calculation is a little more transparent for clarity. 

Let's calculate this:

Predicted result: (I Googled 😜)
(USD) to (GBP 0.82)
54.96 x 0.8178 = 44.95

Actual result: (I cried 😢)
(USD) to (GBP 0.89)
54.96 x 0.8908 = 48.96

Ok... I'm done crying! Let's calculate this beast from another angle:

Linden result: (I found pixie dust by Googling 1 Linden to GBP 🧚‍♀️)
(L$) to (GBP 0.00255)
12,190 x 0.00255 = £31.15 😱 but I paid £48.96! 😭

What I'm trying to say from the above example is this... As a consumer, there's no easy way to calculate the result before clicking [BUY] due to totals being in USD until payment when it finally prompts you "Do you want to purchase L$10 for GBP 8.18" having no conversion details.

Edited March 24, 2023 by VSwitch
For more clarity

[Rolig Loon]

It's hard to know the answer, since Linden Lab (Tilia, actually) doesn't do any conversions. They deal in USD. Any conversation is done by PayPal, your credit card issuer, or whoever is handling your money after it leaves SL.

[VSwitch]

That's the problem, the 3rd party can charge whatever they like for a handling fee. However, they should return a breakdown to the merchant, so the form could then look like this:

Purchasing: L$12,190
Subtotal: 44.95 GBP
Handling fee: 4.01 GBP

Total: 48.96 GBP 

It's simply down to what details the 3rd party sends back to the merchant and nine times out of ten it's a simple handshake 😒

[Rolig Loon]

48 minutes ago, VSwitch said:

That's the problem, the 3rd party can charge whatever they like for a handling fee. However, they should return a breakdown to the merchant,

That's a decent observation, although I suspect that it would be very hard to put into practice.  Tilia (Linden Lab) is hardly in a position to tell PayPal or the credit card companies that they have to send back fee information and a final adjusted total.  I doubt that those huge companies would care to modify their systems to accommodate a small client like Linden Lab. 

The situation is sort of like the one I face if I have been traveling abroad.  When I leave home, I may have $200 U.S. in my pocket.  I convert it to Yen or Euros and lose something in the conversion fee. Then I buy food and souvenirs. I arrive back home with a wallet that still has some Yen or Euros in it, but I have to convert them to USD before I can use them at home. And, of course, I lose the conversion fee for that transaction.  So ..... the actual cost of my food and souvenirs has to include the conversion fees on both ends.  That's what I actually paid.  But do all of the merchants I dealt with in Japan or Germany have to know what those conversion fees amounted to?  How could they tell me in some meaningful way how much my purchases were really costing me?

[Arwen Starchild]

I didn’t even realize this was a thing until today. My premium membership renewed and it was $12 more than last year. I contacted my bank and they told me TILIA charged me $146.03 CAD for premium. On the website it still says premium is $99 USD which should be $135 CAD as of today according to Google. When I contacted second life support they literally lied to me and told me my bank did the conversion not them.

I’m so tired of being lied to and companies trying to scam me for an extra few dollars here and there because they think I can’t do basic math or use Google. I’m in the process of abandoning my main land and getting a refund. Think it’s time to stop supporting greedy companies that lie to our faces.

[Wulfie Reanimator]

2 hours ago, Kayla Suki said:

I didn’t even realize this was a thing until today. My premium membership renewed and it was $12 more than last year. I contacted my bank and they told me TILIA charged me $146.03 CAD for premium. On the website it still says premium is $99 USD which should be $135 CAD as of today according to Google. When I contacted second life support they literally lied to me and told me my bank did the conversion not them.

I’m so tired of being lied to and companies trying to scam me for an extra few dollars here and there because they think I can’t do basic math or use Google. I’m in the process of abandoning my main land and getting a refund. Think it’s time to stop supporting greedy companies that lie to our faces.

Neither side might be lying in your case. It could be that LL charged you for an amount, which (after your bank's conversation rate) was more than the rate "google" has given you.

You can't expect "google" to give you The Truth, because different banks and payment processors use different rates for many reasons.

Edited May 13, 2023 by Wulfie Reanimator

[Arwen Starchild]

My bank sent me a screen shot from their back end showing Tilia charged me in CAD for the amount of $146.03. I specifically asked them if they did any currency conversion on this transaction and they said NO.

It seems like the scam is that Second Life requests $99 USD, sends that request off to Tilia, they do the currency conversion, apply an inflated exchange rate then send that inflated amount off to my bank to be processed.

Tilia is owned by Linden Labs, so in my eyes they are the same entity. Second life can claim all they want that they don’t do the currency conversion, which is technically true… however Tilia is OWNED BY THE SAME COMPANY. Tilia is inflating the transaction by either using dubious exchange rates OR adding hidden fees they aren’t disclosing upon purchase.

I really doubt my bank would send me a false screenshot from their back end when they know I’m going to file a legal dispute if I can’t get this resolved. That would be out right fraud on their part. Seeing as other people, in different countries, with different currencies are experiencing the exact same problem the only logical conclusion is that Linden Labs is inflating the price and trying to pass blame onto the bank. I’ve already contacted the CRA (Canadian equivalent of the IRS) to report this transaction as fraud, because I am clearly being defrauded by someone in this whole process. If it turns out my bank is lying I will admit my suspicion is wrong, but at the moment all evidence seems to suggest Tilia is fudging the numbers for profit.

[Lindal Kidd]

8 hours ago, Kayla Suki said:

I’m in the process of abandoning my main land and getting a refund.

I'm angry on your behalf for your situation. It's always frustrating when two companies start pointing fingers at each other. But I want to caution you that you will NOT get a refund by doing this. LL does not give refunds on unused portions of a Premium account. 

I would think your best bet is to take pictures or scan the receipts from your bank and attach them to your complaint to LL Billing or Premium Support.  Send copies of any and all correspondence with LL to your bank and CRA, and conversely copy LL on things you send to your bank.

[Arwen Starchild]

5 minutes ago, Lindal Kidd said:

I'm angry on your behalf for your situation. It's always frustrating when two companies start pointing fingers at each other. But I want to caution you that you will NOT get a refund by doing this. LL does not give refunds on unused portions of a Premium account. 

I would think your best bet is to take pictures or scan the receipts from your bank and attach them to your complaint to LL Billing or Premium Support.  Send copies of any and all correspondence with LL to your bank and CRA, and conversely copy LL on things you send to your bank.

I updated my support ticket with the banks screenshot a few hours ago. I requested the refund on premium from Second Life within hours of the payment going through, and my banks branch manger knows I dispute the amount but told me to give Tilia a couple of days to reverse the charge and if they refuse then my bank will initiate a charge back.

At this point I’m so fed up with being lied to that whoever is the one responsible for this is losing my business. If it’s Second Life inflating the exchange rate and then trying to gas light me into believing it’s really my bank I’m done, I’ll delete my Second Life account and move on with my life. If my bank is lying and sending me misleading documentation then they are going to be reported for fraud and I’ll be closing my bank account.

Most people probably wouldn’t care this much about $12, but for me it’s out of principle. 

[bigmoe Whitfield]

15 hours ago, Kayla Suki said:

I updated my support ticket with the banks screenshot a few hours ago. I requested the refund on premium from Second Life within hours of the payment going through, and my banks branch manger knows I dispute the amount but told me to give Tilia a couple of days to reverse the charge and if they refuse then my bank will initiate a charge back.

At this point I’m so fed up with being lied to that whoever is the one responsible for this is losing my business. If it’s Second Life inflating the exchange rate and then trying to gas light me into believing it’s really my bank I’m done, I’ll delete my Second Life account and move on with my life. If my bank is lying and sending me misleading documentation then they are going to be reported for fraud and I’ll be closing my bank account.

Most people probably wouldn’t care this much about $12, but for me it’s out of principle. 

whom ever the payment processor is for Tilia could also be the one doing the conversion too.  there are multiple routes here, I would just keep a cool head and work with everyone to figure it out.

[Arwen Starchild]

Just thought I’d provide an update on this. My support ticket has been ignored for the last 5 days. I’ve sent multiple replies asking for a status update on my refund and have heard nothing back. I’ve now requested a charge back from my bank. It’s now in the hands of the legal process for disputing credit card transactions. In a way I’m kind of glad Second Life chose to ignore me, because now an investigation is being done and I will finally find out who is the one trying to scam me. I will provide one final update once the process has finished and I know the results.

[Alwin Alcott]

14 hours ago, Kayla Suki said:

My support ticket has been ignored for the last 5 days.

You could try calling billing or live chat.

Also on the forums it's like the Lindens were off this week ..