TransferWise

TransferWise is an international money transfer provider widely known for its fair exchange rates and low fees. Since its beginning in 2011, the company has seen massive growth, partly due to the fact that they offer the most currencies among all digital banks. As a matter of fact, the service is available in almost all countries and covers more than 1,000 country combinations across more than 50 currencies. Additionally, TransferWise is one of the few money transfer companies that offer the mid-market rate for exchanging currencies. Read more about TransferWise in this review.

Last updated: July 15th, 2020.

Company:TransferWise Ltd.
Business:Money transfer
Founded:2011
Founders:Kristo Käärmann & Taavet Hinrikus
Origin:United Kingdom
Ownership:Private
Costumers:Over 8 Million users
Monthly volume:Over 5 Billion in USD

Office location in London

Table of Contents

What Is TransferWise and How Does It Work

TransferWise was founded in 2011 by the Estonian friends Taavet Hinrikus and Kristo Käärmann, who saw a lack of a simple workaround when it came to transferring money from one currency to another, and, therefore, they decided to launch TransferWise.

TransferWise is a platform for transferring money in one currency from one account to another account into another currency. The service is available in almost every country in the world (144 countries, to be exact), and out of these 144 countries, registered users can send money to more than 80 countries. 

With TransferWise, users can open multi-currency accounts in which they can hold more than 50 different currencies and send money around the world much cheaper than what would have been the case with traditional banks. The TransferWise account comes with a debit MasterCard with which you can spend money wherever you are in the world at the mid-market exchange rate, also called the “real” exchange rate. 

You can easily register on TransferWise by uploading a few ID documents for verification purposes. TransferWise is not a bank, but rather “addressers” of your existing electronic bank account.

TransferWise Pros & Cons

Pros

Cons

Sending and Receiving Money with TransferWise

In order to send money with TransferWise, you need to sign up. Creating an account can be done free of charge either online or through their app by providing your email address or your Google or Facebook account. For some currencies, or especially large transfers, TransferWise would have to verify your identity before proceeding, and this might take up to two banking days.

TransferWise has no limits for how much you can transfer, however, your private bank might have established a limited amount of money that you can send per day or transfer. The transfer limit might also be affected by the device you use for sending the money; sometimes mobile transfers are more limited than online transfers.

How fast it is to send and receive money with TransferWise varies depending on how you do it. Both sending and receiving money with TransferWise is instantaneous, whenever the transfer is carried out from one TransferWise account to another. If you are sending money to a person’s bank account (and not a TransferWise account), you should expect between one and three business days before the other party receives the money in his/her account.

Sending or requesting money with Transferwise is not free of charge. That said, the fees applied are very low. You can read more about it below under “TransferWise Fees and Transfer Costs”.

TransferWise Account Options

TransferWise offers a multi-currency account for private persons such as travellers, expats and freelancers who want to send and spend money around the world without worrying about high exchange rates. Besides the personal Borderless Account, Transferwise allows companies to open free international business accounts that they can use to pay invoices in foreign currency to people abroad, receive money without any fees, and spend company money using TransferWise’s free debit card.

TransferWise’s accounts are not bank accounts as such, but rather accounts where you can hold more than 50 different currencies and exchange these currencies into other currencies to the real exchange rate when sending or spending money to/in a foreign country.

In the section below, the article will take you through the private multi-currency account and, hereafter, dive into the business account.

TransferWise Borderless Account

TransferWise started offering their multi-currency Borderless Account in May 2017 which works alongside their normal money transfer services and offers low fees for sending money to other TransferWise accounts or a regular bank account in a different country and a different currency. The account also allows you to convert money between a great variety of currencies to a low and fair exchange rate and spend money from the account using the linked TransferWise debit card, which we will talk more about further down in the article.

The Borderless Account is ideal for individuals who carry out business in multiple countries and want to get paid like a local without having to pay the usual fees. The account is also perfect for those who are travelling a lot and want to be able to spend money from their Borderless Account in different currencies without paying the local transaction fees.

One of the biggest advantages of TransferWise’s multi-currency Borderless Account is that it provides users with unique and personal local bank details in various countries.

These are some of the countries for which you can create local bank details:

  • UK – You get a British account number and sort code
  • Poland – You get a Polish account
  • Eurozone – You get an IBAN number with your own SWIFT/BIC details
  • US – You get an account number and a routing number (ABA)
  • Australia – You get an account number and a BSB code
  • New Zealand – You get an account number

The fact that you receive unique and local banking information allows you to get paid directly in the local currency of the country you are situated in. You can also share your TransferWise account information with whoever you want to, e.g. friends and family or business partners and clients, thus enabling them to send money directly to your Borderless Account the exact same way as if you had a traditional bank account in the same country as them.

How to Fund your TransferWise Multi-Currency Account

Since the Transferwise account is not an actual bank account, you would have to fund it with money from your regular bank account. This can be done in various ways, and you can freely choose your preferred funding method from your private Borderless Account.

You can add money to your account in the following ways:

  • Through a debit card or a credit card
  • By making a bank transfer from another account
  • By having someone else transferring money to your account

Note that TransferWise will reject transactions of currencies that are not the same as the bank details, so you should always make sure to fund, send and receive money in the currency of your TransferWise account.

How to Set Up Your Personal TransferWise Account

Creating a Borderless Account on TransferWise is very easy, and TransferWise does not charge any fee for opening an account. In addition, the whole process of creating an account takes place online, so no need for any tedious paperwork.

Here is how it is done:

  1. Provide documents that verify your identity
  2. Select currency (you can set up balances in more than one currency)
  3. Add money to your account (using the above-mentioned funding methods)

TransferWise Business Account

TransferWise also offers the possibility of opening a free international business account that can be used for sending, spending and receiving multiple currencies from around the world. The business account is ideal for freelancers or sole traders, SMEs with low monthly payment volumes, however still usable for even large or enterprise level businesses with a monthly payment volume bigger than 200.000 GBP.

Some of the most beloved features of the business account are these:

  • TransferWise business account integrates with the accounting software platform Xero
  • The business account allows you easily to make multiple payments in one batch
  • TransferWise’s open API enables automated payments and workflows  
  • Businesses can download monthly statements for all of the balances they hold

Overview of Transferwise Cards

The TransferWise card is a debit MasterCard, which means that you can only spend money that you have in your TransferWise account. In other words, you cannot make overdrafts.

Advantages of having a TransferWise debit card:

  • The TransferWise card allows you to spend money in 50 countries
  • You pay no annual fees for having the card at your disposal
  • Cardholders save money on foreign transactions fees
  • The fees for currency conversion are very low
  • ATM withdrawals are free for up to 200 GBP/250 EUR every month all over the world
  • Spendings in different currencies will automatically be converted
  • You can get discounts on hotels when booking with the card

How Do I Get a TransferWise Debit Card

When you open a TransferWise account, you can order a free TransferWise card, when your account balance is minimum 20 GBP/EUR/USD, 30 NZD/SGD or an equivalent amount in another currency.

As soon as you have received your card, you can activate it either online or in the mobile app by entering the 6-digit code you will find on your received card.

Currencies on TransferWise

Although TransferWise does support a large number of currencies, not all currencies are available in the same situations. It may vary, for instance, what currencies that are available for current accounts, what currencies you can hold in the app, what currencies you can pay with cards, and what currencies you can use to top up your account. In the table below, you can see what currencies are available…
  • In your current account
  • For exchanging money in the app
  • For topping up your account
Current account
(5 currencies)
Mobile app
(44 currencies)
Topping up
(18 currencies)
AUD, BGN, CAD, CHF, CZK, DKK, EUR, GBP, HRK, HUF, NOK, NZD, PLN, RON, SEK, SGD, TRY, USDAED, ARS, AUD, BDT, BGN, CAD, CHF, CLP, CNY, CZK, DKK, EGP, EUR, GBP, GEL, HKD, HRK, HUF, IDR, ILS, INR, JPY, KES, LKR, MAD, MXN, NGN, NOK, NPR, NZD, PEN, PHP, PKR, PLN, RON, RUB, SEK, SGD, THB, TRY, UAH, USD, VND, ZARAUD, BGN, CAD, CHF, CZK, DKK, EUR, GBP, HRK, HUF, NOK, NZD, PLN, RON, SEK, SGD, TRY, USD

TransferWise Fees and Transfer Costs

TransferWise is well-known for offering a fairly priced and reliable service. Below, the article will go through some of the fees associated (or not) with TransferWise’s services.

Account Opening and Maintenance Fee

It does not cost any fees to open a TransferWise account, nor does it cost anything per month or year to maintain the account and have the virtual bank account at your disposal. The only fee related to your account that you might encounter is a minor 0.2% fee when using some specific payment methods for adding money to your account.

Transferwise Card Fees

Card users will be charged no TransferWise debit card fees, and even the delivery of the card to your address is free of charge. However, when you use your debit MasterCard to spend money in a different currency than what you have selected for your Borderless Account, you will be charged a low conversion fee.

Withdrawing Fees

ATM withdrawals are free up to 200 GBP/250 EUR (per month). If you exceed those limits within a month, withdrawals will cost 2% of the total amount withdrawn. As long as you do not withdraw more than 200 GBP or 250 EUR, withdrawals are 100% free.

Transfer Fees

TransferWise does not offer free transfer; instead transferring money is subject to a flat fee which will depend on the currency transferred. The transfer fee consists of a fixed fee for sending the money as well as a fee for converting your money into another currency (if needed). In the table below, you will find an overview of TransferWise’s fixed transfer fees.

AUD1.05 AUD
CAD1.05 CAD
EUR0.63 EUR
GBP0.60 GBP
INR55 INR
JPY300 JPY
MXN24 MXN
NZD1.45 NZD
USD1.40 USD

 

Transferwise Top-Up Fee

TransferWise charges a small fee for topping up money in your account of between 0 and 0.2%. Some countries, however, are charged more, for instance Hungary, for whom the top-up fee is 0.4%.

TransferWise Exchange Rates

TransferWise is dedicated to providing a true mid-market exchange rate which is the best exchange rate you can get. The mid-market rate, also called the real or true exchange rate, implies a zero markup compared to many traditional banks who offer customers a rather high above-market rate which ultimately results in customers ending up paying more (up to eight times more) for exchanging currencies due to hidden fees.

It is not unusual that big banks markup an exchange rate of more than 2% and sometimes close to 3%. In comparison, the fee charged by TransferWise will rarely exceed 1% and in most cases, the exchange rates would lie between 0.35% and 2.00% depending on the currency you are exchanging and the country you are trying to send money to.

In the table below, you can get an overview of the exchange rates for transferring money between some of the most popular currencies.

FromToRate
USDEUR, GBP0.45%
USDCAD0.53%
USDINR0.60%
USDBRL1.28%
USDMXN0.61%
EURGBP0.41%
EURINR0.56%
EURUSD0.41%
GBPAUD, EUR, USD0.37%

Transferwise App for Mobile

The mobile app from TransferWise provides users with a great overview of their account, cards, and spending habits. Every time you make a payment, you will receive a notification from the app, which allows you to stay on top of your expenses at all times. To get even more control of your spending, you can set up spending limits. The TransferWise mobile app also lets you change your PIN code and freeze your card if you have lost it or your purse was stolen.

Reviews in both Apple’s and Google’s app stores reveal a great user satisfaction with an average score of more than 4,5 stars out of 5.

Comparison of TransferWise

In this section, we will compare TransferWise to two other popular money transfer services, Revolut and PayPal, with the purpose of making it easier for you to decide which one of the companies is the most ideal company for you, considering your specific situation.

TransferWise vs. Revolut

The services offered by TransferWise and Revolut are very similar; both offer cheap money transferring in a lot of different currencies, both offer cards, and both offer personal as well as business accounts. Therefore, it can be challenging to determine which one of the two companies to opt for.

The two companies do, however, differ in some of their offers and the fees they apply to their services, which the table below illustrates.

 TransferWiseRevolut
Countries available+50+30
Available in AsiaYesNo
Currencies supported+90+140
Multi-currency accountYesYes
Currencies to be hold+50+20
Debit MasterCardYesYes
Virtual cardNoYes
CryptocurrencyNoYes
Receiving moneyGBP, EUR CHF, USDGBP, EUR, CHF
How to accessOnline + appOnly app
InsurancesNoYes
Vault (saving)NoYes
Banking licenseNoYes
Account typesStandardStandard, Premium, Metal
Free transfersNoYes

TransferWise is available in more countries than Revolut, including in Asia, where Revolut is still not present. At the same time, TransferWise allows you to hold more currencies in your account – more than 50 – whereas Revolut “only” lets you hold money in up to 24 different currencies in your multi-currency account.

Although Revolut lets you hold, transfer and receive fewer currencies than TransferWise, it comes with other advantages that TransferWise does not, such as virtual cards, insurances and saving and budgeting tools.

TransferWise vs. PayPal

PayPal is one of the most well-known money transfer companies in the market and has been in the game since 1998. The biggest advantage of PayPal is in fact a clear result of their many years in the business: A lot of people have a PayPal account, which makes it less of a hassle to send and receive money. 

For most people out there, however, the best money transfer service is not necessarily the most known, but rather the cheapest, and, in that case, TransferWise beats PayPal by a mile or even more. Why? Because TransferWise uses the mid-market rate when it comes to exchange rates which basically means that it does not get much cheaper.

To compare, PayPal explains that they use the banks’ wholesale rate on top of which they add another 2.5-4%. This essentially means that transferring money between currencies with PayPal might even be more costly than transferring money from one currency to another with your bank.

How Safe Is TransferWise?

More than five million people worldwide have trusted TransferWise with their money. Consequently, TransferWise moves more than four billion pounds around the world on a monthly basis, and when doing so, the safety and security of your money are prioritized as least as much as providing low and fair exchange rates. Therefore, they always aim at fulfilling rigorous regulatory standards in the UK, Europe, and the US as well as any other country they operate in. 

Even though TransferWise is not a bank, it is an Authorised Electronic Money Institution regulated by the Financial Conduct Authority (FCA) in the UK and registered with the Financial Crimes Enforcement Network (FinCEN) in the US. 

TransferWise is required by law to protect users’ money by storing it in an account in a low-risk financial institution, which, in the case of the UK, is Barclays and, in the case of the US, either the Community and Federal Savings Bank (CFSB), Cross River Bank (CRB), or Wells Fargo. These accounts are reserved for customers’ money and, in this sense, the money in these accounts is kept separate from the money used to run the business.

In the unlikely event that TransferWise would go bust, they will make sure that your money is fully refunded from the accounts in the banks holding your funds. However, if the underlying financial institution becomes insolvent, your money is not protected by the Financial Services Compensation Scheme (FSCS) in the UK nor by the Federal Deposit Insurance Corporation (FDIC) in the US

Contact TransferWise Customer Service

One of the things that TransferWise does really well is their customer care and customer service, both of which are being praised in various independent reviews of the platform. Their helpful and professional personnel can be contacted either by telephone, via email, or, when you are a registered user, by using their instant chat system.

TransferWise offers telephonic customer service for 14 different countries in 10 different languages. They have two separate lines for personal and business users, and these lines are open during office hours from Monday to Friday.

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