Withdrawal Fees, Taxes and Currency Exchange using Paxum

[wcs]

Hello Everyone,

I know 4 Independent models in the Philippines very well, who share a rented room for streaming on Chaturbate. One of the models (let's refer to her as "Jane") uses Paxum to handle withdrawal of tokens for the group, convert USD to PHP (Philippines peso) and withdraw the PHP into her UnionBank of the Philippines account to send money to each model.

Jane explained there are high fees, taxes currency exchange charges in the Paxum payment process, so she only receives 50 PHP per $1 USD (after CB token conversion to USD). The recent official currency exchange rate for USD to PHP is 59 to 60 PHP per $1 USD, so it all adds up to losing $0.15 to $0.17 out of every $1 USD, which seems very high to the 4 models.

1. The CB website states that they only charge a fee of $0.50 USD for Paxum.
2. My understanding is that CB sends money to Paxum via PSP that only charges a fee of $0.25 USD.
3. The Paxum website does not state what markup they charge for currency conversion until you are actually executing the withdrawal transaction. However, other financial institutions typically have a markup of 3% to 5% over the official currency exchange rate.
4. The Paxum website states that they charge $5.00 USD for sending money via Local Bank Transfer to your OWN account (UnionBank).
5. The UnionBank website states that they charge 10 PHP = $0.17 USD for interbank transfers.
6. There should not be any taxes charged, except maybe VAT on the fixed fee amounts.

As an example, for 10,000 tokens converted to $500 USD, the total fixed fees is only $5.92 USD or 1.19%. If Paxum charges a 5% markup for currency conversion, then the total charges is $30.92 USD or approx. $0.06 out of every $1 USD, which is acceptable to the 4 models.

Where is the missing approx. $50 out of $500 for 10,000 tokens, or approx. $0.10 out of every $1 USD that Jane receives?

I would appreciate if any AmberCutie members who use Paxum can share their experiences on how much they receive (or lose) on their CB payments via Paxum. If I am missing or misunderstanding some things in my calculations, then please help me shed some light on them.

Thank you.

 

[SCRIPTA]

Jane explained there are high fees, taxes currency exchange charges in the Paxum payment process, so she only receives 50 PHP per $1 USD (after CB token conversion to USD). The recent official currency exchange rate for USD to PHP is 59 to 60 PHP per $1 USD, so it all adds up to losing $0.15 to $0.17 out of every $1 USD, which seems very high to the 4 models.

FALSE, in that there are no exchange fees, taxes, VAT, etc. The rate is close to accurate. Editing to clarify, Paxum does charge a "transaction" fee, but not really an "exchange" fee.

The CB website states that they only charge a fee of $0.50 USD for Paxum.

TRUE

My understanding is that CB sends money to Paxum via PSP that only charges a fee of $0.25 USD.

TRUE

The Paxum website does not state what markup they charge for currency conversion until you are actually executing the withdrawal transaction. However, other financial institutions typically have a markup of 3% to 5% over the official currency exchange rate.

FALSE, in that there is no "markup" at all. The exchange fluctuates every several minutes, so yes the actual exchange rate is only provided at the time of exchange. It could change within minutes, and often does.

The Paxum website states that they charge $5.00 USD for sending money via Local Bank Transfer to your OWN account (UnionBank).

TRUE

The UnionBank website states that they charge 10 PHP = $0.17 USD for interbank transfers.

TRUE

There should not be any taxes charged, except maybe VAT on the fixed fee amounts.

TRUE, no taxes, and no VAT.

As an example, for 10,000 tokens converted to $500 USD, the total fixed fees is only $5.92 USD or 1.19%. If Paxum charges a 5% markup for currency conversion, then the total charges is $30.92 USD or approx. $0.06 out of every $1 USD, which is acceptable to the 4 models.

Where is the missing approx. $50 out of $500 for 10,000 tokens, or approx. $0.10 out of every $1 USD that Jane receives?

There is no additional conversion "fees" per se... Whatever the current conversion rate is, that's what's sent/received. The current rate as of this post is 1 USD = 58.2304871 PHP. The only fee imposed by Paxum is their 5 USD "transaction fee." I have no idea what other line these models are giving you.

I would appreciate if any AmberCutie members who use Paxum can share their experiences on how much they receive (or lose) on their CB payments via Paxum. If I am missing or misunderstanding some things in my calculations, then please help me shed some light on them.

Thank you.

Paano ko ’to alam? Hello… Pilipina ako.

 

[droopla]

I think the problem is that you let paxum convert the US$ to PhP and is using very bad exchange rates.
You should ask your bank if they accept US$ and let your own bank convert them.

 

[m3lissa]

Hello Everyone,

I know 4 Independent models in the Philippines very well...

Hi, so I understand you suspect Jane is keeping some dollars on the side and being creative with the fees and charges, yes?

Certainly the numbers don't seem to add up. Even with a highly unfavorable spread, they should be getting at least 90% (this being very very low) of each dollar amounted after fixed charges (~$6.00). That'd amount to lose $0.11 for each dollar from a 10,000 tokens withdrawal, but it really should be the $0.06 you said or less.

From what you say, it seems that the models are sharing a business venture as partners, so I think it wouldn't be inappropriate or a big deal if Jane were asked to share screenshots with the details of the transactions with them, right?

But honestly, even though it may seem like a good idea to withdraw all the tokens from a single account, it may not be so good after all. Having an external individual controlling your income poses a huge risk. For starters, there is the transparency issue (that seems to be already going on), but then, if that person gets banned, you lose access to your money until you resolve a new payout method or the ban sorts out if you already had tokens there for withdrawal. Say Jane's account gets banned for fraudulent behavior (like selling tokens on the side), then you'll be banned too as those same tokens will be traced back to you. Or maybe she'd just decide one payday that her model career is over and go to the beach with everyone's money.

Do they have any special reason, beyond sharing the $6 fixed charges, to not have a personal payout method? I don't know anything about the Philippines situation or financial system, but maybe you or @SCRIPTA can tell me how easy or difficult it is for people there to get a Paxum and bank account.

Also, it is probable anyway that Chaturbate itself asks them to provide a personal payout method at some point and it will do so by revoking their account's ability to tip. This will be resolved by providing a personal payout method, but then the whole matter should be resolved going through support in a time span that could be weeks--but even if it is days, those are any number of days without their money more than the zero days they'd have to wait if they set up a personal account now. Think that saving $4.5 just isn't worth it.

 

[wcs]

FALSE, in that there are no exchange fees, taxes, VAT, etc. The rate is close to accurate. Editing to clarify, Paxum does charge a "transaction" fee, but not really an "exchange" fee.


TRUE

TRUE

FALSE, in that there is no "markup" at all. The exchange fluctuates every several minutes, so yes the actual exchange rate is only provided at the time of exchange. It could change within minutes, and often does.

TRUE

TRUE

TRUE, no taxes, and no VAT.


There is no additional conversion "fees" per se... Whatever the current conversion rate is, that's what's sent/received. The current rate as of this post is 1 USD = 58.2304871 PHP. The only fee imposed by Paxum is their 5 USD "transaction fee." I have no idea what other line these models are giving you.



Paano ko ’to alam? Hello… Pilipina ako.

Hello @SCRIPTA ,

Thank you for your response.

Your detailed information explains a lot and will be very helpful to the 4 Independent models.

Regarding Paxum charging $5.00 USD for sending money via Local Bank Transfer to your OWN account, I just found an INTERACTIVE MAP on the Paxum website that indicates Local Bank Transfer is not available in the Philippines and not to a number of other Asian countries:

Paxum: Transfer and Withdrawal Methods

Send and Receive Payments with Ease

www.paxum.com

Can you confirm if this is still true, or if Local Bank Transfer is now available in the Philippines. If it is not available, then my understanding is that Paxum would charge $25.00 USD for WIRE Transfer in PHP.

Thank you.

 

[wcs]

I think the problem is that you let paxum convert the US$ to PhP and is using very bad exchange rates.
You should ask your bank if they accept US$ and let your own bank convert them.

Hello @droopla,

Thank you for your response.

According to @SCRIPTA, Paxum does not any markup or fees on currency conversion. The official currency exchange as of this post is 59.5535 PHP per $1 USD, which would be great for the models.

 

[SCRIPTA]

Hello @SCRIPTA ,

Thank you for your response.

Your detailed information explains a lot and will be very helpful to the 4 Independent models.

Regarding Paxum charging $5.00 USD for sending money via Local Bank Transfer to your OWN account, I just found an INTERACTIVE MAP on the Paxum website that indicates Local Bank Transfer is not available in the Philippines and not to a number of other Asian countries:

Paxum: Transfer and Withdrawal Methods

Send and Receive Payments with Ease

www.paxum.com

Can you confirm if this is still true, or if Local Bank Transfer is now available in the Philippines. If it is not available, then my understanding is that Paxum would charge $25.00 USD for WIRE Transfer in PHP.

Thank you.

Local Bank Transfer is available to Philippines banks. I receive payments from several sites (multiple revenue streams, always) every single week, directly into various banks. I also split up my banking for additional security. Small transfers under 40k PHP (usually sent P2P) arrive within an hour, while payments exceeding 90k PHP (usually sent EFT) might take a business day, or three. Also worth noting that many sites also have their own Paxum accounts used for model payouts, so when I get paid from these sites, the fee is only -.25USD via P2P instead of the -5USD. Also worth noting that using Paxum Local Bank Transfer, the client will only get their LOCAL currency. I am not able to receive USD to any of my banks. This is just a Paxum thing as I am able to receive USD from family and friends using bank wire transfers and such.

 

[SCRIPTA]

According to @SCRIPTA, Paxum does not any markup or fees on currency conversion.

I should clarify my previous statement. Perhaps @AmberCutie could even edit my original reply to remove the misinformation. Paxum surely does in fact take a small percentage on currency exchanges. I was more or less implying that during the client transfer, what you see is what you get, without any additional unforeseen exchange fees.

The official currency exchange as of this post is 59.5535 PHP per $1 USD, which would be great for the models.

So whereas the the current market rate might be 59.5535 PHP for every 1 USD, Paxum will offer 58.5535 PHP for every 1 USD. But their current rate fluctuates with the market rates. BUT, whatever rate the client is getting is clearly stated at the time of transfer. I hope that makes sense. I've edited this post several times trying to be very clear.

 

[wcs]

Hi, so I understand you suspect Jane is keeping some dollars on the side and being creative with the fees and charges, yes?

Certainly the numbers don't seem to add up. Even with a highly unfavorable spread, they should be getting at least 90% (this being very very low) of each dollar amounted after fixed charges (~$6.00). That'd amount to lose $0.11 for each dollar from a 10,000 tokens withdrawal, but it really should be the $0.06 you said or less.

From what you say, it seems that the models are sharing a business venture as partners, so I think it wouldn't be inappropriate or a big deal if Jane were asked to share screenshots with the details of the transactions with them, right?

But honestly, even though it may seem like a good idea to withdraw all the tokens from a single account, it may not be so good after all. Having an external individual controlling your income poses a huge risk. For starters, there is the transparency issue (that seems to be already going on), but then, if that person gets banned, you lose access to your money until you resolve a new payout method or the ban sorts out if you already had tokens there for withdrawal. Say Jane's account gets banned for fraudulent behavior (like selling tokens on the side), then you'll be banned too as those same tokens will be traced back to you. Or maybe she'd just decide one payday that her model career is over and go to the beach with everyone's money.

Do they have any special reason, beyond sharing the $6 fixed charges, to not have a personal payout method? I don't know anything about the Philippines situation or financial system, but maybe you or @SCRIPTA can tell me how easy or difficult it is for people there to get a Paxum and bank account.

Also, it is probable anyway that Chaturbate itself asks them to provide a personal payout method at some point and it will do so by revoking their account's ability to tip. This will be resolved by providing a personal payout method, but then the whole matter should be resolved going through support in a time span that could be weeks--but even if it is days, those are any number of days without their money more than the zero days they'd have to wait if they set up a personal account now. Think that saving $4.5 just isn't worth it.

Hello @m3lissa,

Thank you for your response.

At his time, there is not enough information to suspect that Jane is keeping some dollars on the side and being creative with the fees and charges. My opening post was intended to gather information from other Paxum users. The 4 models are relatively new to Chaturbate, completely new to Paxum and completely new to withdrawing tokens themselves. They were previously working in studios that processed payments and took 50% of the earnings (maybe more because studios never show how payments are calculated). They are not completely comfortable with detailing the situation in English in a post here on AmberCutie, which is why I offered to do so.

It may turn out that the Jane does not know the optimal procedure in Paxum, or may have misunderstood the charges. For example, if she used wire transfer instead of local bank transfer (if available), then that makes a big difference.

You raise a good point about asking Jane to share screenshots with the details of the transactions. Right now, the situation is to trust each other, unless and until there is additional independent information, which is what I am gathering.

You raise a good point about the risks of concentrating the financial matters in Jane, as the only person who knows the details and is in control. This is definitely a concern for them to consider.

There are quite a few people (also online services in Colombia) who offer to process payments for models. I know a number of models who send their tokens to these people, who take 15%-20% as their profit. The expectation for Jane to use her with Paxum is not to have to pay a profit to those people.

When Jane created her Paxum account, it was actually a bit cumbersome and took a lot more time than expected. Paxum did not accept her Philippines National ID Card for verification and she had to get a Philippines passport, which has a fee and it may take >1 month to get an appointment at a passport office, then take more time for them to process your application. Paxum requires proof of address (e.g., recent electricity bill with your name and address), which Jane does not have, but eventually found that her Barangay Card was accepted (I know another model who had to pay the electricity company to change the electricity bill to his name from his father's name). Paxum requires a bank account to withdraw into, which many young people do not have due to the bank fees and they use GCash, PayMaya or other wallet service that do not have or has only low fees, but eventually found that people can open a free account at GoTyme Bank.

$6 may not be much to many people in developed countries, but is significant to quite a few models in the Philippines who may only spend $40 USD = 2,400 PHP per month on food.

 

[SCRIPTA]

she had to get a Philippines passport, which has a fee and it may take >1 month to get an appointment at a passport office...

Many here are unaware that the online appointments for passports "reset" every night, at or around midnight. So although it may appear that no appointments are available until months away (if checked during the day), after midnight many appointment windows re-open. The reason for this is "fixers" here grab all the open slots every morning/night in hopes to use or sell them. If those slots are unable to be sold or used,those slots will open up again.

...then take more time for them to process your application.

Pay whatever the extremely cheap fee for 1-week processing; and mailed directly to them. Their passports will be delivered superfast and direct, without them having to go into the immigration offices.

 

[wcs]

I should clarify my previous statement. Perhaps @AmberCutie could even edit my original reply to remove the misinformation. Paxum surely does in fact take a small percentage on currency exchanges. I was more or less implying that during the client transfer, what you see is what you get, without any additional unforeseen exchange fees.


So whereas the the current market rate might be 59.5535 PHP for every 1 USD, Paxum will offer 58.5535 PHP for every 1 USD. But their current rate fluctuates with the market rates. BUT, whatever rate the client is getting is clearly stated at the time of transfer. I hope that makes sense. I've edited this post several times trying to be very clear.

Hello @SCRIPTA,

Thank you for the clarification. A small markup by Paxum for currency conversion is still very acceptable to the models.