Gone are the days when people used to wait for hours in banks to send money to other countries. Now it does not only take lesser time but it also costs less. So many companies have now come into the picture that has changed the customer’s experience of fund transfers. One of the most prominent name in the list is TransferWise. This name has completely changed the way money used to travel between two countries. It offers you the best deals in the market and it’s up to eight times cheaper than the traditional banks. Not only this, it converts your currencies at real mid-market exchange rates, saving you a lot of money. Keep reading this article to know more about TransferWise, its fees, services and much more.
What is TransferWise?
TransferWise is one of the leading P2P service providers for sending funds internationally. It was founded in 2011 and has its headquarters in London. You can send payments to individuals as well as to businesses using its online account. It functions entirely online using its website and mobile app. It does not have any physical branches . It only sends money to the bank account of the recipient. The company has grown multiple folds in only 7 years into the business and now operates in 60 countries. It gained its popularity by offering extremely low fees, without any hidden charges.
How does TransferWise work?
This company was founded by Taavet Hinrikus and Kristo Käärmann, two gentlemen who were living in London but belonged to Estonia. Taavet used to send payments from Estonia to London and Kristo used to send payments from London to Estonia. In this process, they were paying a lot of banks fees. They eventually realized that this could be done without paying any fees at all. This is how the concept of peer to peer payment came into their mind and they started this venture.
In peer to peer payment, the company holds some funds in every country in which they operate. When someone makes a request to send a payment, the amount gets deposited to the origin country’s account and the equivalent amount from the destination country’s account gets delivered to the recipient. This is how they save a lot on the fees as the money doesn’t leave the country. They charge a small fee for this transaction and you also get real mid-market exchange rate. When a service provider doesn’t give you real mid-market rate, you also lose money during the currency conversion. In this way, you not only save money in fee but also in exchange rate. At transfersreview.com, you can see how much you can save in your next transaction as compared to other popular service providers.
It offers very competitive fees which are extremely transparent. You don’t have to pay any hidden charges. When you initiate a transaction you can see the total fee which will be charged to you. This fee includes a small percentage of the amount being sent along with a flat fee. This flat fee depends on the countries and currencies involved in the transaction. Apart from this, you may also have to pay credit card fee if you use your credit card to pay for the transaction. The credit card fee depends on the credit card type and the currency.
Let’s have a look at the payable fees when $1000 is sent from the US to these countries using TransferWise.
|Country||Amount sent||Applicable Fee|
You can see the fees are very low comparing to a bank and many other service providers. Usually, a bank charges $30 – $60 for such transaction that is a robbery.
In most cases, TransferWise gives you true mid-market exchange rates which are the fairest in the business. It freezes the exchange rate for the customer when the transaction starts. So the amount does not get affected by the fluctuations while the payment reaches the recipient. In this way, the recipient gets the specific amount they have expected. This feature is called “Guaranteed Rate”. This guarantees the exchange rate you will get at the time of delivery.
Let’s have a comparative look between the exchange rates of TransferWise and actual mid-market exchange rates to see if it actually uses real mid-market exchange rates.
|Conversion||TransferWise real exchange rate||Mid-market exchange rate|
|USD – EUR||0.85715||0.85732|
|GBP – EUR||1.13390||1.13375|
|USD – INR||68.1750||68.1862|
|GBP – AUD||1.7887||1.7887|
|GBP – CAD||1.7887||1.7631|
It is clear that their exchange rates are very close to mid-market rates and can really be called real mid-market exchange rates.
Is TransferWise safe?
Safety of their money will always be an important matter of concern for customers. While making any big or small transaction they need the guarantee that their money will reach its destination. Here your money is always safe in any transaction. The company is regulated by UK’s Financial Conduct Authority. They keep the company’s fund and the client’s fund separately. The client’s funds are always safe and in case of any financial issues with the company the client’s funds are never in danger. Another concern which most of the online user have is the security of the company’s website and payment gateways. Their website secures all of your sensitive information with smart HTTPS security encryption. It has done international transfers worth billions of dollars and has never given a reason to doubt their security.
TransferWise bank account
In addition to sending payments internationally, it also offers you a borderless account. You can use this account to send and receive payments and to spend money in different countries. You can receive payments from more than 30 countries using this account. With this account, you get Australian, British and US account number along with European IBAN number. When you send or receive money using these details you save money in terms of fees from both ends. You can also keep different currencies in your account and exchange them into other currencies whenever you wish. In every exchange, you get the real exchange rates applicable to all other transactions. You don’t have to pay any monthly fee or keep any minimum balance to keep the account active.
TransferWise is indeed a great choice for those who frequently send money to other countries. It has very good reviews from its customers and on Trustpilot, it has a score of 9 out of 10. Around 88% of customers at Trustpilot has rated it as “Excellent” and praised its simplicity and low fees. In such a small time it has managed to establish a strong base for itself with millions of loyal customers globally.