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Are banks giving you a headache with their long waiting times, paperwork, and poor rates?
Payoneer and Transferwise are online money transfer services for freelancers that facilitate cross-border payments. Both are reliable ways to send and receive money abroad but there are differences when it comes to fees, exchange rates, and so forth.
So which option is right for you?
Two leading online money transfer services to compare here are Transferwise VS Payoneer.
What Makes Transferwise and Payoneer Similar?
What are the similarities between the services and what can they provide?
Purpose
Payoneer and Transferwise are used to send and receive money from abroad. They are a borderless transfer service solution, similar to Paypal. They connect millions of people and businesses across countries and currencies.
The accounts allow you to hold and manage money so you can wait until the exchange rates are more favorable and prepare for future transfers. The currencies come with their own bank details so anyone can pay you just like they’d pay a local.
Their rates are always based on the current mid-market rates, which you can find on Google or their site.
Lower Fees than Banks
While bank transfers can be free or cost very little, there is a catch; they are often accompanied by an unfavorable exchange rate. The banks are often accompanied by paperwork and regulations that could make transfers even more of a hassle. This is why using a borderless online transfer solution is a more suitable option.
Free Account
Transferwise and Payoneer are free to join. You can set up your own account and wait until it’s approved. Small fees are incurred in the event that you send or receive money.
On-Boarding
They both have an onboarding process, which can be time-consuming.
Payoneer and Transferwise need to know who’s using their services so they can combat money laundering and keep money safe.
Specify if you are an individual or business. Input your personal details. You may have to submit other documents, such as a Utility Bill, to verify your details. You will also have to submit your banking details.
Mastercard
You can order your own MasterCard with both Transferwise and Payoneer which enables you to make payments in stores, online, or anywhere a MasterCard is accepted. You can withdraw from the ATM, and fees are applied to each transaction.
Funds are transferred to your card automatically or manually depending on the settings you choose online. You can also set limits as to how much you can spend with your card. You can order the MasterCard whether you are a company or an individual.
One thing to note is that your card may not work in all countries. You will have to check if the card is available for use in certain countries. For example, Transferwise MasterCard can not be used in certain countries, such as Iraq, Cambodia, and Syria.
Popularity
Both Transferwise and Payoneer are very popular online money transfer services. Both Transferwise and Payoneer have positive online reviews even if their services suit different needs.
What Makes Transferwise and Payoneer Different?
What makes the online transfer services different? Let’s compare!
Purpose
Transferwise is geared towards individuals and private clients. They also accept businesses.
Payoneer is suitable for small businesses that hire freelancers and individuals who want to receive payments from abroad. Rates are cheaper as the amount of money sent is higher. Payoneer partners with sites like Airbnb and Fiverr to receive money online.
Availability
Transferwise is for those who have bank accounts in the UK, USA, Europe or Australia. You can send and receive money in multiple currencies, check our review here for further details.
Payoneer is more widely available to individuals across the globe.
Mastercard Fees
Payoneer: You are entitled to receive a MasterCard from Payoneer when you’ve received a minimum of $100 in payments.
- Payoneer allows you to have a free account that you can use to withdraw money to your local bank account.
- An annual fee of $29.95 is charged for having a MasterCard
- While making purchases online and instore are free, ATM withdrawals or cash reimbursements (via bank teller or instore) cost 2.50 EUR or $3.15 USD or 1.95 GBP.
- Payoneer also charges a currency conversion fee if you don’t have the specific currency in your account. Conversion rates can be estimated using Mastercards official conversion tool.
- Payoneer charges an additional charge on top of the Mastercard’s conversion rates. This currency conversion charge is up to 3.5%.
Transferwise: They might ask you to add money to your balances or pay a small fee to get the card.
- 0.24 – 3.69% conversion fee if you don’t have the currency in your account. This will depend on the country and currency and further details of the exact rates can be found on their website.
- Free withdrawal up to 250 USD or the equivalent in your own currency per month. After that, there will be a 2% withdrawal fee.
- Note: sometimes the sellers try to charge their own conversion fee, even if you have the other currency in your account. To avoid this, ask the seller to charge you in the currency you want.
Popularity
Transferwise has a better overall rating to Payoneer on Trustpilot but that’s not to say one service is better than the other. The service that’s right for you will depend on the reasons why you are using your account.
Transferwise has a 4.6 out of 5 star rating on Trustpilot, with over 95,000 reviews currently.
Payoneer has a 4.5 out of 5 star rating on Trustpilot, with over 25,500 reviews to date.
Fees
Payoneer generally has higher fees than Transferwise when sending and receiving cash. Take a look at the rates below.
Onboarding
Payoneer is known to take longer; maybe even a few days, to approve accounts.
Transferwise and Payoneer: Fees
The nitty gritties you need to know before making a decision whether to use Transferwise or Payoneer.
Making Payments
Payoneer charges 1-3% when making payments to non-Payoneer accounts. Alternatively, a fixed fee of 1.50 EUR/ USD/ GBP is charged if the account holder is in the same currency that is being paid.
It is free to make payments from one Payoneer account to another Payoneer account
Transferwise has a small fee when making payments to somebody else’s account. This usually consists of a fixed fee (approximately $1 but it depends on the currency) and a variable fee. You can check out the transparent fees here on the Transferwise Fee Calculator. Transferwise charges approximately 0.5% – 0.9% of the transfer’s volume.
Accepting Payments
Payoneer charges 1-3% on all incoming fees. If you are being paid by another Payoneer customer, it is free of charge.
Transferwise allows you to receive money in EUR, USD, GBP, AUD & NZD for free.
Withdrawing Funds
Payoneer charges 2% withdrawal fee to your bank account. Alternatively, if your bank account is the same currency, it will cost 1.50 USD/ EUR/ GBP.
Transferwise charges a fixed fee when withdrawing funds to your bank account (approximately $1 but it depends on your currency)
Fees Breakdown
Here is a table comparing the current fees when using Transferwise and Payoneer. Transferwise is generally the cheaper option, in most cases.
| Make Payments | Accept Payments | Withdraw Funds | |
| Payoneer | 1-3% charge or 1.50 for non-Payoneer accounts | 1.3% charge | 2% charge or 1.50 to bank account |
| Free from one Payoneer account to another | Free from one Payoneer account to another | 2.50 EUR or $3.15 USD or 1.95 GBP for ATM withdrawals | |
| Transferwise | Small Fee (variable and fixed fee), usually 0.5-0.9% of transfer volume | Receive money in EUR, USD, GBP, AUD, NZD, SGD, PLN | Fixed fee (approximately $1; depends on your currency) to bank account |
| Free from one Transferwise account to another | No fees to receive payments | Free ATM withdrawal up to 250 USD or equivalent in your currency; 2% fee thereafter |
Transferwise VS Payoneer: The Winner is Transferwise
By using either Payoneer or Transferwise, you will save a lot when compared to using your local bank. When sending money through your bank, the conversion rates are usually quite poor by comparison.
Transferwise allows you to save money and comes with cheaper fees than most financial institutions. It will save you considerable time when transferring money online; whether that is making or accepting payments, or withdrawing funds.
You can also download the Transferwise app and use it on the go; check out our full Transferwise review here, if you haven’t already.
Transferwise is by far the best option when moving money abroad that is under $5000. If you are making larger transactions or you are using a freelance platform such as Fiverr or Airbnb, Payoneer might be a more suitable option.
The Benefits of Using Transferwise:
- Sign up for Free
- No fees for holding an account
- Great savings and low cost
- Helpful support team
- No hidden fees
- Great ratings and reviews
- Speedy transfers within 1-2 working days
Conclusion
Transferwise and Payoneer are two options when dealing with online payments. If you would like to know about other services, you can check out this article I wrote about how you can get paid online. These include other options for the online English teacher to consider.
