TransferWise Vs. Payoneer: What You Need to Know
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
- Multi-currency capabilities
- Travel/Debit cards
|Transfer Type||Online||Online and phone|
|Discount||No||Free $50 coupon|
|Cost||2% on incoming payments and 3.5% on cash withdrawal with the Mastercard.||Complete fees amount to 0.5% to 0.9% of the transfer’s volume.|
|Speed||24-48 hours||Up to 72 hours|
|Minimum Transfer Amount||£1 / $1||Depends on the customer|
|Debit Card||Mastercard that comes with the Borderless Account||Mastercard|
|International Accounts||TransferWise Borderless Accounts||Payoneer Local Currency Accounts|
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.
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.
Payoneer lets you make payments with no fees. 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 Mastercard you can use like a debit card. 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.
Unlike companies like PayPal and TransferWise, Payoneer only allows transfers to other Payoneer accounts. This can present a major inconvenience if you don’t have an account or your client won’t get one. This is also why it doesn’t work for larger businesses. Additionally, private clients cannot 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. Many people rave about this platform. The company supports more than 750 different currencies across the globe including USD,NZD, EUR, GBP, AUD and CAD. and provides multi-currency accounts. TransferWise 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.
Transferwise has superb currency exchange rates. The conversion fees are some of the lowest in the business. They provide a nifty 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. Unlike Payoneer, there is no yearly maintenance fee for the card. It can be used for anything from grocery shopping to ecommerce. You also receive free ATM withdrawals up to a certain amount each month.
There is no minimum or maximum transfer amount on your account. Payments can be made via:
- Debit card
- Apple Pay
- SWIFT transfers
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.
Not too many people have a whole lot of bad things to say about the TransferWise platform. It can be quite costlier than the competition. They’re looking for payouts each time you transfer. Depending on the exchange and currency, this can get expensive (still cheaper than most banks). The amount of the transfer and where you send it has a great bearing on the cost. That’s why they give you 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. They sort of make you do all the legwork rather than just having a transparent structure. They also will not accept payments from Hong Kong for some reason. Customers have complained about the identification process, so be wary of that when you have urgent payments to make.
“Companies in the financial sector are significantly more likely than their peers to regard customer journey optimization as very important over the new few years (81% for FSI vs. 69% for other sectors).”
Both of please platforms present an easy solution that optimizes the consumer experience and enables a business to send money abroad for any purpose. For businesses seeking additional global supplier payment & automation capabilities, Tipalti’s global mass payment solution makes managing global supplier payments easy, tax compliant, and efficient.