Wise Fees - The Ins and Outs Simply Explained

TransferWise Fees

Wise (formerly known as TransferWise) is a global peer to peer money exchange who provide international money transfers to individuals and businesses. They have a range of fees and to so you can understand them quickly our guide includes:

  1. Who is Wise?
  2. Fees for stand alone international money transfers
  3. Multi currency account or Borderless Account fees
  4. What is the cheapest way to pay with Wise?
  5. How do I avoid Wise fees?
  6. How do Wise calculate fees?

 

Who is Wise (formerly known as TransferWise)?

They were founded in 2011, headquarters are located in the UK and have grown exponentially to become one of the biggest names in international money transfers. They help more than 6 million people transfer over $5 million every month.

Providing low and transparent fees are part of the massive increase in their money transfers overseas. Their fees tend to be 8 times lower than banks like Wells, Chase and Bank of America. They offer super competitive exchange rates and all funds need to be received into a bank account.

TransferWise Fees with TransferWise account

Their fees are low because they have bank accounts all over the world. When you send USD to Germany, you send it to Wise’s US account and your recipient is paid from Wise’s Europe account. The money never crosses borders, so you can save on currency conversion fees.

There are 2 types of fees for Wise, fees for stand alone money transfers and fees for transactions within a Multi Currency account.

Stand Alone International Money Transfer Fees

These are the conversion fee and fixed fee. The conversion fee is the rate you pay above the exchange rate you see on Google. The conversion fee you pay with Wise is a fraction of what you pay with the banks or worse, the airport.

The fixed fee is an amount on top Wise charge for every transfer to that country.

For example: The fees you would pay when sending US$1,000 to Europe are - conversion fee of 0.74% + fixed fee with bank debit (ACH) of $0.89

$7.35 + $0.89 = $8.24

The total transfer fee is less than 1% of the total transfer amount.

The first table lists examples of countries where if you sent US$1,000, you would pay less than 1% of the total transfer amount.

 

 Conversion FeeFixed Fee
Europe - Euro0.74%$0.91
The UK - GBP0.74%$0.91
Canada - CAD0.74%$0.91
Australia - AUD0.74%$0.91
India - INR0.84%$0.92

In the next table includes examples of countries where the fees you would pay are less than 2% of the total transfer amount when sending US$1,000 from the US.

For example: The fees you would pay when sending US$1,000 to Mexico are - conversion fee of 1.03% + fixed fee with bank debit or ACH of $1.23

$10.21 + $1.23 = $11.44

The total transfer fee is less than 2% of the total transfer amount.

 

 

 

 Conversion FeeFixed Fee
Mexico - MXN1.03%$1.23
Philippines - PHP0.88%$1.28
Brazil - BRL1.57%$2.11
Egypt - EGP1.28%$3.57

Keen to go?

Multi Currency Account or Borderless Account Fees

To receive money into your account is free.

A monthly cash withdrawal of $350 is free. After they charge 2% on withdrawals from ATMS.

The card costs $9 to order from Wise.

To add money

It depends on how much and which currency.

  • To add $1,000 to your Euro account paying with USD it will cost $5 for a wire transfer and $8.50 with a bank debit (ACH).
  • To add $1,000 to your GBP account paying with USD it will cost $10.90 for a wire transfer and $9.60 with a bank debit (ACH).
  • To add $1,000 to your CAD account paying with USD it will cost $8.80 for a wire transfer and $5.80 with a bank debit (ACH).
Convert between balances
Using TransferWise Borderless Account is a low cost way to send money to a bank account

When you run out of currency account it will cost you to convert between balances. For $1,000 the fees are listed below:

  • To convert $1000 to Euro or British pounds either within your account or when you pay with your Mastercard it will cost $4.15.
  • To convert $1000 to Canadian dollars either within your account or when you pay with your Mastercard it will cost $4.30.

 

To send money

The conversion fee is the same and a fixed fee is added. For $1,000 the fees are listed below:

  • To send $1,000 to a bank account in Europe it will cost $4.59 with a bank debit (ACH). Conversion fee ($4.18) +fixed fee ($0.41).
  • To send $1,000 to a bank account in the UK it will cost $4.60 with a bank debit (ACH). Conversion fee ($4.18) +fixed fee ($0.42).
  • To send $1,000 to a bank account in Canada it will cost $4.84 with a bank debit (ACH). Conversion fee ($4.38) +fixed fee ($0.46).

You should note that if you spend on your Mastercard in a rare currency, they will charge you the Mastercard rate - Ouch!

 

Spend online overseas on with your Mastercard

If you want to buy something overseas but don't have all of the local currency in your account, Wise will exchange the amount you need for a small fee. For US$1,000 the fees are listed below:

  • To convert US$1,000 to Euro, British pounds or Australian dollars either within your account or when you pay with your Mastercard it will cost $4.18.
  • To convert US$1,000 to Canadian dollars either within your account or when you pay with your Mastercard it will cost $4.38.

 

Transferring money using a TransferWise account is a way to beat bank fees

Which way is the cheapest to pay with Wise?

Paying by bank deposit (ACH) or bank wire is the cheapest way to pay with Wise for stand alone international money transfers from the US.

  • For international money transfers, under $1,700, sending money via a bank debit is cheapest with Wise.
  • For international money transfers, over $1,700 sending money through a wire transfer is cheaper with Wise.

At approximately $1,700 the currency conversion fee becomes higher with a bank transfer than with the wire transfer due to the fixed fee cost $6 of a wire transfer. Up to $1,700 the fixed fee cost of a wire transfer does not make it competitive.

Ready to go?

How do I avoid Wise fees?

Not paying with a credit card or debit card is the way to avoid Wise fees. Credit card is always the most expensive option to send money overseas, followed by debit card. In the example about sending $1700 overseas, with a credit card, the costs increase to $71. Debit card increases the cost to $27. Both bank debit and wire transfer cost $13. Thats $58 in one money transfer alone!

The easiest way to avoid Wise fees to to pay by bank debit (ACH) for international money transfers under $1,700 or with a bank wire for money transfers over $1,700. Work out how much you will pay in fees with Wise's pricing calculator.

What determines the Wise fees?

3 things determine the total fee you pay with Wise, these are - the amount you send, the way you pay and the exchange rate.

The amount you send - the more you send the more you pay as it is based off a percentage system. For this reason we recommend OFX for money transfers over $7,500.

The way you pay - the most expensive way to pay is with a credit card in every situation, next is debit card. Bank debits (ACH) are best for transfers under $1,700 and wire transfers are cheapest for transfers over $1,700 due to the lower exchange rate offered.

The exchange rate - is the rate you pay to swap one currency for another that is determined by global market forces. It can be easily seen on google and it is known as the market rate or mid market rate. Wise charges a conversion fee slightly above the market rate 0.3-3%, banks normally charge a retail rate 3-6% and airports charge above retail at 6%.

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By Arlene Mc Donnell Updated May 19th, 2021