Selecting an international money transfer service often boils down to picking between two titans: Wise (formerly TransferWise) and PayPal. Both platforms are responsible for transferring billions of dollars across the world and yet serve quite different purposes, really.
It’s not only their functionality that can vary dramatically but also their cost structures, with PayPal frequently collecting far more fees than Wise. According to G2 reviews, Reddit discussions, and my exhaustive analysis of real-life transfer costs, here’s how the two firms stack up.
Cheapest Way to Transfer Money Internationally: Fee Breakdown
The figures present a clear narrative. A $1,000 USD remittance to the Philippines:
Wise transfers 54,976.08 PHP (rate: 55.68, fee: $12.66)
53,100.68 PHP is delivered by PayPal (rate: 53.37, fee: $4.99)
PayPal reduces the payment by a little more than 1,800 pesos, even though its upfront fee appears to be lower. The camouflaged expenses accrue rapidly. Total fees usually top 5.4% of the sum sent when one factors in the PayPal-associated costs for:
- A fee of 4.45% is levied on any transaction that is deemed as commercial in nature
- Suboptimal currency conversion rates (1–2 PHP less than mid-market)
- Extra 1% will be charged for transactions that surpass the $2,000-a-day cap
At the same time, Wise normally levies an around 1% charge, with a limit of $10, on international money transfers—a fraction of the fee Western Union charges for the same service. However, the key difference is Wise’s use of the mid-market exchange rate, a much fairer deal for anyone sending money overseas.
International Money Transfer Services: Speed and Reliability
Speed is PayPal’s forte. Transfers are completed in seconds when you and the party you’re transferring funds to both use a PayPal account. Setup with PayPal is even more straightforward than it is with Wise. And once you’re up and running, using PayPal is a breeze—no recalibrating old habits needed.
G2 Ratings Tell the Story:
- PayPal: 4.4/5 stars (2,182 reviews)
- Wise Business: 3.9/5 stars
- Wise Pay: 4.3/5 stars
“They make it really easy to take payments, without any special software or subscriptions, which is great for nonprofits on a small budget.” – G2 PayPal reviewer
The platform is usually up and running, which is crucial when you need to move money. Their infrastructure is built on multiple data centers, so there’s a lot of redundancy for downtime. However, Wise users consistently praise reliability:
“In my opinion, Wise has a pretty low commission rate and is quite efficient. I have always found their service to be trouble-free. For over a year now, I have been using Wise more or less on a weekly basis.” – G2 Wise reviewer
Money Transfer Fees: Transparent vs Hidden Costs
Fundamental distinctions exist between these entities. Wise is, as it emphasizes, an entirely different kind of animal. It shows practically everything it has to offer and spares no effort to provide an experience that is all but naked in comparison with the competition.
PayPal’s fee model is layered:
- Fee for making a transaction—this changes depending on the particular payment method used
- Fee for changing currency (incorporated into the exchange rate)
- International transaction fees
- Fees associated with business accounts during commercial transactions
“PayPal’s direct exchange rate is about 1 to 2 PHP lower than the ‘official’ rate… banks need to make money too, so they have what you call a ‘buying’ and ‘selling’ rate.” – Reddit user explaining exchange rate mechanics
Wise employs the mid-market rate (the same one on Google) and charges a single, transparent fee. No weekend markups, no hidden margins.
In early June 2025, Wise announced that it would relocate its main stock listing from London to the New York Stock Exchange, signaling a strategic shift aimed at accessing larger capital markets—an emblematic move for a company valued at approximately £11 billion
Best Way to Transfer Money Internationally: Use Cases
Choose PayPal for:
- E-commerce transactions (buyer/seller protection)
- Rapid person-to-person transactions within the PayPal ecosystem
- Small, frequent payments where speed matters more than cost
- Business invoicing with integrated payment processing
Choose Wise for:
- Regular international transfers (salary, freelance payments)
- Large transfers where fee savings compound
- Multi-currency accounts for global businesses
- Transparent, predictable costs
“I manage about 4k a month through it. Now, I use Wise, which doesn’t cap my remittance to my bank. I used to work in a bank before which helps me understand the differences in exchange rate.” – Former PayPal user on Reddit
Online Payment Platforms: Security and Compliance
Although both platforms are registered financial institutions, neither offers traditional bank deposit protection (FDIC/FSCS).
Security measures:
- Wise: Client money segregation, regulated in multiple jurisdictions, uses safeguarding
- PayPal: 128-bit SSL encryption, fraud monitoring, dispute resolution system
Compliance:
- Wise: FCA (UK), FinCEN (US), ASIC (Australia) regulated
- PayPal: Licensed money transmitter in all US states, PCI DSS compliant
PayPal achieved US$31.8 billion in net revenue in 2024 and maintained robust financial health with US$6.8 billion in free cash flow heading into 2025 investors.com+2
International Money Transfer: User Experience and Features
Wise Account Features:
- Multi-currency accounts (40+ currencies)
- Local account numbers in 10+ countries
- Debit card for international spending
- API for business integration
- Transparent fee calculator
PayPal Features:
- Instant transfers within PayPal network
- Integrated e-commerce solutions
- Mobile app with payment splitting
- Buyer/seller protection programs
- Extensive merchant tools
“Wise has better exchange rates. PayPal, if you’re registered as a business, will also charge hefty fees. You can get a USD account with Wise and connect it to PayPal to then withdraw from PayPal to wise then transfer whatever you need to SA at a favourable exchange rate” – Reddit user from r/PersonalFinanceZA
Wise vs PayPal: What Reddit Users Actually Say
The general view on Reddit is unmistakable: Use Wise for transferring money and PayPal for paying with it.
From a Filipino freelancer:
“My employer currently uses PayPal. I’m supposed to receive $800 but ends up receiving $709 on my end. I want to ask if we can instead transact through Wise.”
From a South African user:
“Wise is far cheaper and offers the real, mid-market exchange rates, unlike SA banks that sell foreign currencies at a profit.”
However, some users noted recent concerns:
“There’s been mass reports of Wise just blatantly freezing, cancelling or stealing funds with no recourse for ppl recently… even tho PayPal has gotten many complaints as well of PayPal blocking/cancelling transfers.”
Both platforms face occasional account restrictions, particularly for large or unusual transactions.
Wise’s FY2025 report confirms it served over 15 million personal and business customers, processing roughly £145 billion in cross-border transfers and saving users around £2 billion in fees
FAQ
The Verdict: Which International Money Transfer Service Wins?
For regular international transfers: Wise wins decisively
- 30-40% lower total costs on most routes
- Transparent, mid-market exchange rates
- No daily transfer limits
- Multi-currency account benefits
For integrated payments: PayPal remains king
- Instant transfers within ecosystem
- Superior buyer/seller protection
- Established e-commerce integration
- Better customer service (phone support)
The hybrid approach: Many savvy users do both – PayPal for receiving payments, then transfer to Wise for better exchange rates when moving money internationally.
The choice depends on your priority: speed and convenience (PayPal) or cost and transparency (Wise). For most international transfers, especially regular ones, Wise’s savings compound significantly over time.
