Alex Manea
In this article, we'll be reviewing two popular online payment platforms that provide similar features. We will compare Transferwise vs Paypal, to find out how well they both perform and how useful they could be for your global payment needs.
Remote work is one of the few good things that's happened to the job industry in recent times. A Ladders survey affirmed that remote work opportunities will continue to increase through 2023, and it's quite likely that remote working is here to stay.
This global spike in remote working which has employees, investors, freelancers, and more working from anywhere in the world, has led to an increase in e-payment platforms, leaving consumers at a loss for choice.
Wise, previously known as TransferWise, is a fintech-based company launched in 2011 with the goal of making international money transfers easy, cheap, and fair. With a Wise multi-currency account, users can send money all across the world.
Founded by Taavet Hinrikus and Kristo Käärmann, the company has since grown to enable people to manage money internationally and at cheaper rates than regular bank charges.
Its transparent and fair policies have spurred millions of users and businesses to use the account to hold funds in over 50 currencies. TransferWise partners with banks and companies such as Bolt, Monzo, and GoCardless to enable quicker and better international banking for users.
Take advantage of the low transfer fees that Wise offers.
Firstly named Confinity, a company that developed security software for handheld devices, the company has since evolved to something much bigger and globally accepted.
Founded in 1998 by Peter Thiel and Max Levchin, PayPal is now one of the most popular, safer, and easier ways to get paid online. It allows users to make payments via channels convenient to them. So, you can pay on PayPal using your credit card, bank accounts, PayPal Smart Connect, PayPal account balance, and more without having to share any financial information.
PayPal has over 325 million functioning accounts around the world. The platform is available in 202 countries and 25 currencies, making international banking easy for users globally. With over 20 awards for excellence, including the 2006 Webby People's Voice Awards for Best Financial Services, PayPal has won the hearts of many.
Although both platforms offer an alternative to sending money via banks, their services don't come free. TransferWise and PayPal charge a small commission on their transactional services. See Transferwise vs. Paypal fees below:
Wise
Wise has transparent fees for all their transactions. Simply enter details on the Wise homepage and use their calculator to see your transaction fees whenever you want to make a transaction.
International money transfer charges vary between 0.4% and 2%, depending on the currency and type of payment. To deposit to Wise Borderless account, the charges range between 0.4% and 0.5%. To convert between your Borderless account, you'll be charged 0.3% - 0.6%, but 0.1% if you're sending money out of the account.
There are no fees for card issuance, and it's free to make cash withdrawals of up to $250. If you exceed this limit, it costs 2% of the amount.
PayPal
PayPal has more complicated charges for different locations and services.
If you're sending money on PayPal within the US using PayPal Cash, PayPal Cash Plus, or a linked bank account, there are no charges. Paying with a credit card, debit card, or PayPal Credit costs 2.9% of the amount and a fixed fee.
International money transfers via any payment method—PayPal Cash, PayPal Cash Plus, credit card, debit card, PayPal Credit, or a linked bank account—cost 5% of the transfer amount for transactional fees. International PayPal cash payments cost no funding fees. However, payment via any type of card or PayPal Credit costs a funding fee of 2.9% of the transfer amount and a fixed fee.
Selling fees in the US cost 2.9% and $0.30 per transaction. Selling internationally costs 4.4% and a fixed fee depending on the currency. Selling via PayPal Here card reader costs 2.7% for card swipes, or 3.5% and $0.15 for manual transactions.
Comparing PayPal vs. TransferWise security features will give you a better idea of how these platforms keep your money safe.
Wise has a dedicated fraud team, industry-leading encryption, and two-factor authentication working 24/7 to protect your account from any type of fraud. It also provides you with real-time notifications, so you know what goes on in your account and when.
The platform is regulated by the FCA, registered with the Financial Crimes Enforcement Network (FinCEN), and has state licenses in the US, Canada, UK, and Australia.
PayPal is regulated by the FTC in the US, the FCA in the UK, and APRA and AUSTRAC in Australia. The platform also uses high-end encryption technology to keep its platforms safe. However, PayPal users are often subject to various types of phishing and money scams because of the platform's popularity and ease of transactions.
Both TransferWise and PayPal are easy to use, and both interfaces are simple to navigate.
Signing up on Transferwise is intuitive and straightforward. You can sign up and create an account on the mobile app or website easily. You will need to verify your identity, which can be instant in some countries. The mobile app is one of the best-designed apps for global money transfers, making it suitable for beginners.
You may set up an account faster on PayPal (either on the mobile app or website) if you don't have to confirm your identity, but it's advisable to do it if you will use your PayPal for international transfers.
Wise transfers take up to about two days maximum to be completed, while the money you receive on PayPal instantly appears in your PayPal balance.
This currency converter is simple and straightforward to use. It allows you to calculate and convert currencies based on mid-market exchange rates. You can also set alerts that inform you when there's a better currency exchange rate, so you never lose your money. It also provides a chart detailing the rise and fall of rates over a period to help you compare prices accurately.
This calculator lets you convert amounts of money into almost 24 currencies globally. The rates on this calculator are updated frequently, so you don't have to worry about using outdated rates for conversions.
Comparing TransferWise vs. PayPal, we find that both platforms are easy to use and functional for international payments globally. TransferWise has its strengths, and so does PayPal.
Based on the information in the review, choosing the best platform ultimately depends on your needs and what you're looking for from an international money transfer platform. If you're still having a hard time deciding, try our comparison tool to help you find the best platform for your needs.
