TransferWise vs. PayPal - Which International Money Transfer Service is Better

When sending money to a friend or family member in another country, using the right international money transfer service can make all the difference. TransferWise and PayPal are two major players in this industry, each with their own unique strengths and weaknesses. In this article, we'll compare TransferWise and PayPal to help you decide which service is better for your needs.

Fees

TransferWise offers transparent pricing with no hidden fees. They charge a small upfront fee plus a small percentage of the total transfer amount. PayPal, on the other hand, charges a slightly higher percentage fee and also adds a markup to the exchange rate. This means that even though PayPal's fees may seem lower on the surface, you may end up paying more in the end.

Winner: TransferWise

Exchange Rates

Both TransferWise and PayPal offer competitive exchange rates. TransferWise uses the mid-market rate, which is the fairest exchange rate available. PayPal, on the other hand, applies a markup to the mid-market rate, so you won't get the actual rate in the market. However, PayPal offers flexibility on the exchange rate by permitting you to choose between PayPal’s rate or the rate offered by your bank or credit card issuer.

Winner: TransferWise

Speed of Transfer

TransferWise usually takes between 1-4 business days for transfers to go through. However, this may vary depending on the destination country, while PayPal ensures same-day delivery for most international transfers. But, with PayPal, if the transfer is made on Friday, it may not be delivered until the following week.

Winner: PayPal

Transfer Limits

TransferWise has higher transfer limits than PayPal, especially for personal accounts. TransferWise allows up to $1 million per transfer and up to $5 million per account per year. Meanwhile, in some countries, PayPal allows up to $60,000 per transfer and $100,000 per year.

Winner: TransferWise

Customer Service

Both TransferWise and PayPal offer customer support via chat, email and phone. However, TransferWise's customer support is generally regarded as more responsive, helpful, and informed.

Winner: TransferWise

Conclusion

Based on the comparison above, TransferWise comes out on top. They offer transparent pricing, better exchange rates and higher transfer limits in many cases. But, PayPal's same-day delivery and flexible exchange rate may work for some users. Ultimately, it's up to you to decide which service meets your requirements.

Reference: [1] TransferWise vs. PayPal: Which Is Best for Foreign Currency and Overseas Transfers?