A group of people sitting on a couch looking at a laptop. curve

TransferWise Vs. Payoneer : Which One Should You Choose?


We’ve paired this article with a comprehensive guide to financial fraud mitigation. Get your copy of the guide: Avoiding the Risks of Financial Fraud.

As more organizations start outsourcing, international business is increasing. That means people need a way to make and receive global payments. Companies like Payoneer and TransferWise are disrupting the financial services industry and changing the customer experience forever. But, they are one of many. As the trend towards online banking increases, so does the competition. That makes it harder to discern which brand to choose.

TransferWise and Payoneer are two distinct online payment services that are unique in functionality, concept, and target audience. To compare, you should consider some of the following aspects:

  • Ease of use
  • Fees
  • Multi-currency capabilities
  • Travel/Debit cards
  • Security

High-Level Comparison

TransferWisePayoneerTipalti
Transfer TypeOnlineOnline and phoneOnline
DiscountNoFree $50 couponRequest a free demo.
CostComplete fees amount to 0.5% to 0.9% of the transfer’s volume2% on incoming payments and 3.5% on cash withdrawal with the Mastercard6 international payment methods – cost varies
Speed24-48 hoursUp to 72 hoursLess than 24 hours.
Mobile AppYesYesYes
Minimum Transfer Amount£1 / $1Depends on the customerDiffers by payment type and currency
Debit CardMastercard that comes with the Borderless AccountMastercardTipalti Intercash prepaid Mastercard
International AccountsTransferWise Borderless AccountsPayoneer Local Currency AccountsGlobal Mass Payables Solution
Best Suited ForSMBs looking to make international transfersIdeal for B2B payments and for those who operate e-commerce marketplacesBest for companies that require assistance with tax and value-added tax (VAT) compliance

What is Payoneer?

Payoneer is an online payment solution that provides digital payment services, online money transfers, and customers with working capital. Receiving accounts include USD, CAD, GBP, EUR, MXN, AUD, JPY, and CNY. You can sign up for the service anywhere globally and the platform works best for freelancers and small businesses. It can be used to pay people across the globe for their products or services.

Payouts by Payoneer customers to their suppliers and contractors can be made using the Global Payment Service(GPS). GPS payment methods are ACH bank debit, credit card, local bank transfer, or transfer from payor’s Payoneer account to a recipient’s Payoneer account. 

Payees can request a payment from payers in Payoneer. Affiliate, freelancing, and development platforms can use Payoneer to make mass payouts

How Does Payoneer Work?

You must first open a Payoneer account and attach it to your local bank account. Once you log in, simply select the pay tab called “make a payment.” Enter the email address associated with your account and the amount of the payment. You then receive the payment to your account. This is why it is geared toward small businesses and contractors. The ease of use of the platform makes transferring money simple.

Pros

Payoneer makes cross-border payments well. 

Payoneer lets you make payments with no fees to other Payoneer accounts. That’s quite unique for this type of platform. The Payoneer Billing Service allows you to use a credit card to pay existing Payoneer customers. If you live in the United States, you can even make payments via e-check.

The Payoneer customer support system is strong. They provide an extensive help desk with a large knowledge base. If you sign in to your account, you can live chat with someone right away. They’re also available via email and phone, with offices in multiple countries.

Payoneer issues a prepaid debit Mastercard that can be used for spending. You can also receive payments straight to the card. The maximum daily withdrawal limit is $2,500 and you can use an ATM anywhere in the world. If you transfer or withdraw from an ATM, you will pay around 1% of the transaction in foreign exchange fees.

Power your entire partner payouts operations

98%

Customer Satisfaction

$50B+

Annual Transactions

4M+

Partners

4,000+

Customers

99%

Customer Retention

Cons

Besides making payouts, Payoneer only allows transfers to other Payoneer accounts. Private clients can’t transfer money on the platform; only withdraw it. International money transfers are very one-sided.

The platform adds a currency conversion charge of 2% to 2.75% in some countries. If you use the Mastercard in a non-listed currency, you will be subject to their exchange rates. You also need to pay an annual maintenance fee on the Payoneer Mastercard. That is unusual for these types of services. It is also listed in reviews online that the signup process is lengthy and it can take over a month to receive your card.

What is Transferwise?

TransferWise is an online money transfer service founded in January 2011. The company supports more than 750 different currencies across the globe including USD, NZD, EUR, GBP, AUD and CAD. TransferWise also provides multi-currency accounts and has a fair fee structure. They charge an average of .5% per transaction (compared to 3% at a bank). Sign up is quick and easy (although you do need to upload some documents). TransferWise is for freelancers, contractors, and a business of any size.

How Does Transferwise Work?

TransferWise works with a borderless account to make international transfers. They save you money by taking a small percentage of the transaction (rather than a credit card transaction fee or a bank transfer fee). It usually takes up to 3 business days to receive funds. The peer-to-peer platform is free to use, you simply need to open an account.

Pros

TransferWise has excellent currency exchange rates. They provide an interactive calculator on the site to view exchange rate fluctuations. You can also sign up for alerts. The brand’s mid-market rates remain very similar to prevailing ones. The platform lets you transfer international payments directly to overseas accounts. 

TransferWise gives customers a Borderless Account that comes with no fees for account keeping, adding funds, or receiving money. Converting funds and withdrawing money have low fees. The company will provide a prepaid Mastercard linked to the Borderless Account for residents of certain countries. There is no yearly maintenance fee for the card and it can be used for anything from grocery shopping to ecommerce. A customer is also provided with a certain number of free ATM withdrawals each month.

There is no minimum or maximum transfer amount on a customer’s account. Payments can be made via:

  • Debit card
  • Apple Pay
  • SWIFT transfers
  • ACH

Nominal fees may apply when converting from the local currency. TransferWise offers single or repeat payment options as well. There is no overseas address required for the TransferWise borderless account.

Cons

The TransferWise platform can be significantly costlier than the competition. They require payouts for each transfer that’s made. Depending on the exchange and currency, the payouts can get expensive. The amount of the transfer and where it’s sent has a great bearing on the cost. That’s why they provide a calculator, so it’s always best to check before hitting that send button.

It’s tough to compare TransferWise vs Payoneer because of the fee schedule. The user is responsible for the majority of the legwork, rather than providing a transparent structure. Also, for unclear reasons, they will not accept payments from Hong Kong. Customers have complained about the identification process, so be wary of that when there’s an urgent payment to make.

“Companies in the financial sector are significantly more likely than their peers to regard customer journey optimization as very important over the next few years (81% for FSI vs. 69% for other sectors).”

In Summary

Both of these platforms present an easy solution that optimizes the consumer experience and enables a business to send money abroad for any purpose. Ultimately, it’s the prospect’s decision to determine which solution best fits their needs.

For businesses seeking additional global supplier payment and automation capabilities, Tipalti’s global mass payment solution makes managing global supplier payments easy, tax compliant, and efficient. Sometimes your needs go beyond the average needs. Tipalti provides a scalable end-to-end solution that can grow with your company. What does that look like? 

Tipalti gives you the ability to automate the entire global mass payments and payouts workflow, starting with supplier self-service onboarding. Tipalti saves up to 80% of your time and speeds up the time it takes to close the books. With Tipalti, you attract and retain white-label partners, have tax forms that meet IRS requirements, and provide a top-notch partner program experience.

Only Tipalti can match the speed of your company’s growth–whatever speed that may be–to ensure your ongoing payment and supplier workflow needs are always met. 

About the Author

  • Linkedin

RELATED ARTICLES