PayPal Debit Card Unavailable in Canada: What To Use Instead

If you’ve tried to use or apply for a PayPal debit card in Canada, you’ve probably noticed—it doesn’t exist.

Whether you’re a small business owner, online seller, or someone who regularly receives PayPal payments, not having a debit card option can be frustrating.

In this post, we’ll explain why the PayPal debit card isn’t available in Canada and share the best alternatives, including a smart way to convert and move your PayPal USD to Canadian dollars with better rates than traditional banks.

Why the PayPal Debit Card Isn’t Available in Canada

The PayPal Debit Card, popular among U.S. users for its convenience and cashback rewards, is not extended to Canadian residents. PayPal has not provided a public reason for this limitation, but it’s likely due to regulatory requirements, licensing constraints, and differences in banking infrastructure between the U.S. and Canada.

Without a PayPal Debit Card, Canadians can’t directly spend their PayPal balance in-store or withdraw it instantly from ATMs. Instead, they have to transfer the funds to a linked bank account, which can take several days, especially when currency conversion is involved.

The Best Alternatives to the PayPal Debit Card in Canada

Although the PayPal Debit Card is currently unavailable, several Canadian financial products offer similar functionality. These cards offer the convenience of managing money digitally, spending globally, and avoiding excessive fees—all while integrating with PayPal or serving as practical payment options.

1. KnightsbridgeFX – For Converting PayPal Funds to CAD

If your primary concern is obtaining a better value when transferring funds from your PayPal USD balance to your Canadian account, Knightsbridge Foreign Exchange is your best option.

Why KnightsbridgeFX is a strong alternative:

• Bank-beating exchange rates — up to 2.5% better
• No hidden fees
• Ideal for larger PayPal transfers (e.g., $5,000+)
• 1-on-1 service for individuals and businesses
• Fast and secure CAD/USD conversions

Instead of relying on PayPal’s built-in currency conversion (which includes high markups), you can withdraw your PayPal USD funds to a U.S. dollar account and use KnightsbridgeFX to exchange them to CAD at a much better rate.

This is especially helpful if you regularly receive PayPal payments in USD, such as from U.S.-based clients or marketplaces

2. KOHO Prepaid Mastercard®

Koho is a Canadian fintech company that offers a reloadable prepaid Mastercard. It’s designed to function like a debit card and is widely accepted both in Canada and abroad.

Key Features:

• Earn up to 2% cashback on eligible online purchases.
• No interest or overdraft fees.
• Built-in budgeting tools via the KOHO app.
• 24/7 fraud protection and Mastercard Zero Liability.

Heads up:
A 1.5% fee applies to international transactions on standard plans. Premium plans offer better perks, such as no foreign fees and extra cash back.

3. EQ Bank Prepaid Mastercard®

The EQ Bank Prepaid Mastercard is a great digital alternative, linked to your EQ Bank account. It’s a reloadable card that you can use online or in-store anywhere Mastercard is accepted.

Highlights:

• 0.5% cashback on every dollar spent
• No foreign transaction fees
• Easily managed within the EQ mobile app
• Automatically earns interest like a savings account

The card works in sync with your EQ personal account, making it easy to fund the card and keep track of your spending.

While you’ll still pay Mastercard’s exchange rate when spending abroad, EQ Bank doesn’t add additional markups.

4. BMO Debit Mastercard®

If you prefer a traditional bank card, BMO’s Debit Mastercard offers both virtual and physical card options for Canadian customers.

Perks:

• Works in-store, for checkout in online stores like eBay, and via mobile wallets like Google Pay.
• Integrated with your BMO chequing account
• Accepted globally wherever Mastercard is supported

Consider this:
A 2.5% markup applies to all foreign currency transactions, and there are spending limits for virtual cards.

Why Exchange Rates Matter for PayPal Users

Most people overlook the hidden fees that come with PayPal’s currency conversion. Here’s what you need to know:

• PayPal charges an exchange rate markup of 3–4%
• That adds up quickly, especially for freelancers or e-commerce sellers regularly receiving payments in USD
• Even your bank may charge 2–3% on top of the posted rate

With KnightsbridgeFX, you can get access to near mid-market exchange rates, saving you money every time you move funds from PayPal to your Canadian account.

Real Example: Saving More with KnightsbridgeFX

Let’s say you earn $10,000 USD from PayPal in a month.

• PayPal’s default exchange might give you ~$13,000 CAD
• KnightsbridgeFX could get you ~$13,250 to $13,300 CAD depending on the rate

That’s an extra $250–$300 in your pocket, just by using a better exchange provider or payment method.

Choosing the Best Alternative for Your Needs

When choosing a substitute for the PayPal Debit Card in Canada, consider how you primarily use your PayPal account. If you’re receiving or sending payments in USD, tools like KnightsbridgeFX and EQ Bank provide better currency conversion and fund access. If you’re looking for a budgeting tool with added perks, KOHO is a solid choice.

Each of these cards enables you to spend your PayPal balance more efficiently, though they require an additional step of transferring funds to a linked account via bank transfers or e-transfer. However, with the right setup, you can replicate much of the functionality of the unavailable PayPal Debit Card in Canada.

Need to Convert USD to CAD? We’ve Got You Covered

Whether you’re a business owner, online seller, or service provider receiving U.S. payments through PayPal, KnightsbridgeFX helps Canadians like you move and exchange funds more efficiently.

• Better rates than banks or PayPal
• Fast, transparent, and secure
• Friendly 1-on-1 support

Get your free quote or contact us today and see how much more you can get from every PayPal transaction.