Are you looking for a cheap and secure way to send money abroad?
TransferWise and CurrencyFair are potentially your best bet as leaders and fast becoming dominant players on the international money transfer scene.
Both services stand out due to their use of peer-to-peer technology which tends to make transactions inexpensive.
They have plenty of benefits, including:
Fast: As we will show in some cases, money you send will arrive on the same day.
Cheap: Both services claim to be up to eight-times cheaper than a bank and our test showed they were indeed very competitive in many scenarios.
Easy to use: The user interfaces are well considered with services to make it pretty easy.
Secure: Both services claim to offer bank-level security.
But there must be one winner!
Similarities aside there are still some pretty big differences between the two.
Most importantly, which one is better for your needs?
Some of the differences include the fee-structure, added extras, and even the currencies that are available.
|Number of Currencies||18||19||Draw for most people.|
|Costs||Percentage + Small Fixed Fee (fixed fee is generally between 50p and £2 while the percentage is usually between 0.5 percent 1.5 percent.)||Have a fixed fee of three euros per transfer + charges 0.25 percent or 0.3 percent for transfers. (Link below removes the fixed fee from the first 10 transfers)||Both very inexpensive compared to banks - the winner depends on currencies and amount. Draw|
|Transfer Speed||Minutes to more than a day depending on the currency. Generally it takes longer for the bank to send the money.||Less than a day, to a few days. Generally it takes longer for the bank to send the money.||While cards (debit or credit) attract additional fees to cover costs - funds arrive practically instantaneously. Transferwise allows far more countries with Currencyfair only allowing Irish cards.|
|Security||Regulated in the U.K., U.S., Hong Kong, and Australia||Regulated in Ireland and Australia||Draw|
|Trustpilot||5 stars||5 stars||Draw|
|Our Score||5 stars||5 stars||5 stars for amounts of a few thousand or less. |
|Website||www.transferwise.com||www.currencyfair.com||Depends on your Needs (cost, speed and currencies)|
TransferWise – Key Points
Founded in 2011, it grew rapidly and by 2016 was sending over 800 million GBP around the world every month.
Transfers are based on the interbank rate. The exact fee per transfer differs depending on the currencies used.
Added extras include a Borderless Account (review) that gives you bank details in select foreign countries.
You might also like our full review of TransferWise.
CurrencyFair – Key Points
Founded in 2009, with headquarters in Ireland. In 2014, it became the first platform to break the $1 billion barrier in money-matching transfers.
CurrencyFair claims that transfers made using its service can be up to eight times cheaper than bank transfers.
CurrencyFair is unique in that it has created a market for swapping currencies rather than purely focusing on the interbank rate. Added extras include letting you set your own exchange rate where you are happy with the rate.
You might also like our full review of CurrencyFair.
For a Quicker Read – Skip to the 6 Winners as Indicated
6 Super Important Categories We Are Comparing
- Currencies Available – It is important that the service you use has all the currencies you require.
- Cost – For many people, the best service will be the cheapest one. However, the actual price can depend on a number of variables.
- Transfer Speed – The speed of the transfer can be super important if you are in a rush to send money.
- Security – It is vital to ensure that the service you use is secure when sending money internationally.
- Added Extras – When two services are similar, the added extras can make all the difference.
- What Others Are Really Saying – Looking at consumer reviews can really help you get a good idea of what a service is about.
1. Currencies Available
It is really important to make sure that the service you choose has the currencies you need. Luckily, both TransferWise and CurrencyFair support a good selection of currency pairings.
TransferWise currently supports 22 currencies for sending and receiving money. It also supports a further 25 currencies for only receiving money.
CurrencyFair lets you exchange money into 19 different currencies. As well as this, you can send money out to many other countries, although not necessarily in that country’s currency. You can check out the full list here.
Currencies – Winner Is?
TransferWise edges out CurrencyFair as it supports more currencies. Both services have a good selection of currencies to choose from and most likely can transfer what you need.
2. Cost Of Transfer
Assuming both services support the currency pairing you need and you aren’t in a big rush to send your money, the cost of the transfer is likely to be the most important factor.
Luckily, both of these services can be cheap when compared to banks. In fact, if you check out their websites, you’ll notice that they both claim to offer transfers that are up to eight times cheaper than banks.
However, there are some slight differences in the way the pricing structure works for each service. Check them out in more detail below.
Top Tip: The overall cost of the transfer will come from both the exchange rate you get, and the fee charged by the service.
The TransferWise fee is based on a percentage of the overall amount of money you are sending, plus a small fixed. The exact fees vary depending on the currency pairing used. As a guide, the fixed fee is generally between 50p and £2 while the percentage is usually between 0.5 percent 1.5 percent.
Perhaps the best thing about TransferWise is that they use the interbank exchange rate (or mid-market rate). This means that you get the exchange rate you see on sites like Google and you will, therefore, not lose money.
TransferWise also guarantees the exchange rate while you send money to them.
CurrencyFair has a fixed fee of three euros per transfer, or a similar amount if you are transferring using a different currency. On top of this, CurrencyFair charges 0.25 percent or 0.3 percent for transfers made using the marketplace and between 0.4 and 0.6 percent for non-marketplace exchanges.
When it comes to the exchange rate, you have two options with CurrencyFair. When using the marketplace system you set your own exchange rate and wait for someone to match it. Alternatively, you can use the rate suggested by CurrencyFair which they say this is a competitive rate.
UPDATE: Thanks to CurrencyFair, you can also get the first 10 transfers fee free.
Cost – Winner Is?
The good news is that both these services are highly competitive. In fact, for amounts of a few thousand or less – P2P with these two as standouts in terms of size and service is almost certainly going to be your best option. However for larger amounts, it must be said, P2P looses its edge as it seems to become harder to match the funds (and costs rise) as we found in our comparison between OFX and TransferWise.
In our tests, neither service appears to be consistently cheaper than the other. It all depends on the amount you are sending, as well as the currency pairing. If you really want squeeze every last penny out of your transactions the best thing you can do is register with both services and try them out.
For some though, the rate guarantee that TransferWise offers for 24 or 48 hrs while you send your money to them makes it a clear winner. For others, sending money to your CurrencyFair account while waiting to lock-in the right rate to be offered will make them a clear winner.
Perhaps it might be better to choose one based on some of the other categories where more some differences really started to show – like transfer speed.
3. Transfer Speed
How long the transfer takes can be really important if you need to send money quickly. Even if you don’t, it is still nice if the transfer is as quick as possible so you know the money has arrived safely at its destination.
Both TransferWise and CurrencyFair claim to be faster than banks. However, there are differences especially in the method of payment. Most notably, if you are going to use a debit or credit card to make the payment (which attracts additional transaction costs to cover costs) then TransferWise is almost certainly a better option.
The time your transfer takes will include:
A: Can takes days or be instantaneous.
B: TransferWise and CurrencyFair are able to control this time which can vary.
C: Receiving banks control this time.
TransferWise lets you pay for the transfer using both card payments and bank transfers. While bank transfers can take time to go from your bank to TransferWise, card payments are usually instant.
Once the money has reached TransferWise, the transfer can take anything from minutes to more than a day depending on the currency.
One good thing is that when you set up a transfer, TransferWise will always provide you with an approximate amount of time that it will take.
CurrencyFair also offer instant card payments, although, at the time of writing, this feature was only available to users in Ireland. Bank transfers are not instant and the exact time they take can depend on the sending bank and the currency.
Luckily, CurrencyFair has provided a helpful guide with estimates for how long it takes for each currency to arrive in the CurrencyFair account.
CurrencyFair says that transfers out can typically take anywhere from less than a day, to a few days. Again, they have a neat tool that estimates the amount of time it will take for money to arrive.
Transfer Speed – Winner Is?
TransferWise just edges this one as they allow a larger number of users to pay into the service by card.
Security is very important when it comes to money transfers. However, both these companies should be pretty much as secure as each other. They both send millions of dollars of currency around the world every year and they are both heavily regulated.
TransferWise is regulated by the financial authorities in countries including the U.K, U.S., Hong Kong, and Australia. On the company’s website, they claim to have “bank-level” security that they are constantly checking. They also say they train their staff in matters of security.
On an individual level, you can set up two-factor login on your account. This means you will be required to not only input your username and password, but also a number from a text message sent to your phone when you want to log in. They also claim that they monitor profiles for unusual activity.
CurrencyFair is regulated by the Central Bank of Ireland. This requires them to have safeguards in place to protect the funds of customers, have more than a minimum amount of capital, pass a “fit and proper” test, and more.
On an individual level, they also provide two-factor authentication, website encryption, and full tracking of transfers and exchanges made on the platform.
Security – Winner Is?
Both CurrencyFair and TransferWise provide a secure platform that is trusted for transfers worth millions of dollars every year. We’ll call this one a draw.
5. Added Extras
As we’ve seen so far, both companies are pretty similar when it comes to the service they offer. However, they do both have some interesting extras that you can take advantage of.
TransferWise offers customers a Borderless account which can be used to store and exchange currencies. With the Borderless account, you can get separate bank details for an Australian, British, European, and US bank account. Customers based in some countries can even get a debit card to use with their borderless account.
CurrencyFair has a currency exchange marketplace where users can choose the exchange rate they are happy with. This means that if you don’t mind waiting, you can select a rate that is lower than the current best available rate and wait for someone to match you.
Extras – Winner Is?
You choose what you think you might want. Both are great added extras that might make the difference or not.
6. Customer Reviews
Customer reviews are a great way to get an overall idea about a service as you can see what the overall feeling is from people who have used it before.
With this in mind, there is both some good news and some bad news when it comes to choosing the best service based on customer reviews.
TrustPilot indicates both TransferWise and CurrencyFair have five star “excellent” ratings. Once again, this makes it pretty much impossible to rank one service as better than the other.
On TrustPilot, most of the TransferWise reviews compliment the service’s quick speed and low transfer rates. Most of the negative reviews appear to be about things that seem beyond the company’s control such as regulations and bank transfer times.
Reviews left about CurrencyFair tell basically the same story. They say it’s quick, easy-to-use, and cheap. The negative reviews mostly appear to be things beyond the company’s control.
Reviews – Winner Is?
Another draw as, on the whole, customers appear to be very happy with the service they receive from both TransferWise and CurrencyFair.
The negative reviews suggest that before making the transfer you should be aware of external things that could affect how long the transfer takes. This can include bank holidays in one of the countries involved and verification steps you may have to go through.
And the Overall Winner Is…?
TransferWise and CurrencyFair are two excellent services for sending money overseas. Based on our review, we found TransferWise to be slightly better than CurrencyFair in currencies available and speed.
However, these were both minor victories that may not even matter in certain situations.
Importantly for many people, the best service will simply be the cheapest one and CurrencyFair is often the cheapest.
For amounts of a few thousand, you can’t really go wrong with either of these as both are dramatically cheaper than banks.
However, if you plan on moving more than a few thousand dollars each time, the preference may be towards services that are not reliant on other peers – see TransferWise V OFX.
If you plan to use a credit or debit card however to send money then (unless you are in Ireland) TransferWise will be your best choice (as discussed this will cost more).
If you simply want to save the most money, it could be worth checking them both out to get an estimate about how much your transfer will cost. This is free to do and could end up saving you a decent chunk of money.