Advantages of using TransferWise over PayPal
July 16, 2019
by Debasmita Chatterjee
It has just been a week that one of my articles got published on an international website. I was all set to receive my first international transfer via PayPal when I got informed that it will take some more time for them to verify the PAN Card I have uploaded. While I waited for the limitation to be lifted, I got to know about TransferWise and found out that it is the most sought after company for borderless banking. So I registered myself in there and did a good amount of research. Here is what I learned about virtual bank accounts or global wallets and how TransferWise is more convenient than the PayPal
Companies like TransferWise or Revolut are easy solutions for receiving, holding and sending different currencies around the world. Super low fees and currency conversion rates are a welcome break for people international travelers and business people alike.
Paypal vs TransferWise : Creating An Account.
Though TransferWise doesn’t allow Indians to have a borderless account, signing up and setting up a profile is free like Paypal and a lot easier as well. One needs to only fill in the basic details and add up their bank account using the banks IFSC Code (Or IBAN if applicable) and is good to go. In PayPal, one needs to include the account and wait for multiple layered verifications to happen.
When you send money through TransferWise from one country to another, they simply transfer the amount from an account in the receiver’s country to the receiver’s account. Therefore, there is no real overseas transaction happening. This enables them to charge only a minuscule amount as their fees and the no money is lost while in currency conversion.
While Pay Pal charges 2.5% of the transferred amount as fees plus a fixed fee of INR 3 and an 18% of the Pay Pal fees as GST ( Goods and Services Tax) in case of India, TransferWise fees range from 0.35% to 2.85%.
In TransferWise, one can also find out how much money will be received after the deduction of fees with an easy calculator.
Though this facility is not yet available in India, the borderless account is almost like having local accounts in countries throughout the world. A multicurrency account which lets one keep money in almost 40 currencies, is a boon for people who do regular international transactions. The borderless accountholders can also avail a debit MasterCard.They can use it for atm withdrawals all over the world and for debit card transactions in MasterCard approved places.
There has been a mixed review about the timing Transfer Wise takes for processing a transaction though. Because the transaction is based upon the local banking hours, sometimes there are unprecedented delays. Competitors like Revolut are trying to catch up to the goodwill that TransferWise has earned in the past few years but with supporting 48 countries, Transferwise still rules the roost. The company is expanding its network to more countries and it is only a matter of time when we would get to avail the borderless accounting facilities in India as well. I am excited about that.