Canadian PayPal – How to Transfer USD to Your Bank

This Article is for anyone residing in Canada who wants to either :

  • Transfer USD dollars out of PayPal and keep it in USD
  • Transfer USD dollars out of PayPal and save money when converting them to CAD

Solutions presented here might be a good starting point for other local currencies if you reside outside of Canada and the United-States.

Update : As of August 2018, I started relying on Transferwise for the whole process and the last withdrawal and currency conversion I made from PayPal in USD to my personal bank account in CAD only required a fee of 0.6% with no additional charges using the Transferwise borderless account.

Update : As of September 2019, it seems like PayPal disabled the option which makes it impossible to withdraw in USD at all for people without pre-existing links to their US bank account. When adding a new account, the option saying “Link a U.S. bank instead” doesn’t seem to work anymore. If you can get to the form for adding a US bank in your PayPal account, all of the information in the article may still work. I’m still using this to withdraw in USD but setting up any new connection might be disabled by PayPal themselves. Please share your result in the comments.

Update : As of September 2019, PayPal re-enabled the option to add a US Bank. Withdrawal in USD as it is stated in this article should still work perfectly.

Some Context

I’ve been selling music online for years now. I receive money from licenses and services in U.S. dollars since it’s what most sales platforms will support and is likely the most internationally recognizable currency by clients worldwide. As a Canadian, it’s nice to have one of your income sources be mainly in USD since it lets you diversify your holdings and allow you to pay directly for stuff in the U.S. whenever Canadian dollars aren’t accepted. However, PayPal won’t let you withdraw that money directly and leaving an enormous amount of foreign currency in your PayPal balance won’t be of any help past a certain point.

What not to do : Canadian USD bank account. I tried following tips from other sellers online. I’ve tried multiple Canadian banks offering USD accounts to make withdrawals and none of them worked. When reading through dozens of posts and comments, you will see that most of the time, making it work this way is a hit or miss. It was a miss for me and your success rate might entirely depend on customer support and a great amount of luck. This solution might not even work anymore so I’m not going to recommend doing that but if you want to know more, here is one place where you can still read about it : 

Most of the Canadian banks don’t have the proper infrastructure in order to accept USD transfer directly because they need third-party intermediaries banks, additional payment instructions, maybe even government regulations, etc…. which will result in PayPal being unable to fulfill withdrawals. Most of the time, managing to make it work anyway is considered as a loophole and will often result in strange behavior when using the linked account with PayPal (e.g. link being deleted when trying to deposit money from the bank to PayPal). A direct routing number is required and transit numbers that we use in Canada won’t work. After much research, I’ve been able to find a proper solution.

The Problem

If you move money online, you are most likely getting paid in US dollars and it is piling up into your account. There really is no way to manage collecting Canadian dollars directly from every platform you are using. If you withdraw the money out of your balance using the default PayPal withdrawal option to your Canadian bank, you will be losing money by paying sub par fees for their currency conversion service on top of the fees you already paid for using their platform for payment processing.

Current PayPal fees for normal Canadian seller for transactions in the U.S. as of writing :

  • 3.7% + $0.30 Transaction Fee
  • ~4% Currency Conversion Fee USD to CAD Withdrawal

No need to point out that it’s almost a 8% mandatory fee for normal use. While we can’t do much about transaction fees, it is possible to greatly reduce or eliminate the obligatory currency conversion fees for withdrawals.

The solution I’m using is Transferwise (Click here to check it out). The service will allow you to grab USD from a bank account, convert it, and send it directly as CAD to another account for only 0.6% + $1 USD. They even used to charge 1% when I started using their service but they surprisingly lowered their fee for that pair.

However, if you either want to keep your money in USD or convert it to CAD, you will still be required by PayPal to have an account with full United-States bank details (there is a way to get one fast online with no paperwork using Transferwise). If you don’t have that already, that’s what the next section is about.

Getting a U.S. Bank Account

Please do your due diligence and read the terms carefully when choosing and opening a bank account. Here are three solutions you can use :

The first solution is to open a USD bank account in the United-States directly (not a Canadian USD account). Most banks will require you to physically walk into their building in order to open an account which won’t be a problem if you frequently travel to the US.

If you don’t travel to the US, you will have less options but a few banks like BMO Harris will let you open an account on the phone and submit the required documents by mail. The account I’m currently using is with them and it has no monthly fee and no minimum balance required. I can use it to transfer USD directly to my brokerage account or, as said earlier, convert and transfer the money using Transferwise to my main bank. There might be a small fee of around $1 USD when making a transfer that your bank will charge when making a debit transaction on top of Transferwise fees.

This last solution didn’t exist when I opened my US bank account but might be the fastest and cheapest. Just recently, Transferwise started offering borderless accounts (Click here to check it out). Some currencies, like U.S. dollars, will come with banking details that you can use to link with your PayPal wallet and save you from having to go through the somewhat lengthy process of opening a classic bank account by mail, phone, fax, etc. You will have the ability to convert currencies at the same rate they usually offer. For the purpose of moving money straight to a bank account, the borderless account might be the best solution but for other banking functions, your options might be limited compared to a classic bank account.


Before I post an article, I check to see if the products I’m recommending offer links for affiliate marketing and I grab what I can get. If any of those services have one or not, the text here stays unchanged. This article isn’t a paid promotion, however, links to transferwise are affiliate links so if this was helpful to you, make sure you use one to sign up. I will get a small amount of money if you do and make your first transfer within a certain time frame. The borderless account didn’t exist until recently so I wasn’t planning on making most of this article about Transferwise but it seems like they are now offering the best solution for all parts of this process.

I lost hours of work with customer support and banks trying to find ways to move USD and lost thousands of dollars to fees using PayPal default withdrawal (at least the fees are tax deductible). I hope this article will be useful to you.