Review and test of transferwise for companies
What exactly is Transferwise?
TransferWise is a company that will help you (among other things) to make money transfers abroad in a simple and economic way, thus avoiding the normally high commissions that your bank or other services such as PayPal would impose on you; TransferWise earns money by applying a small commission to each transfer made. This is done transparently, and you will always see it before completing a transfer.
Since its inception, they offer their star service: international transfers that include currency exchange with minimal costs (around 0.5%); this is done at the real average exchange rate on the market (the fairest exchange rate, which you will read more about elsewhere in the guide) and with no hidden fees.
After solving the problem of sending money, they decided to get to work with the problem of receiving international payments, and for this they created the borderless account (also known as a multi-currency account); with this account you can obtain bank details of various currencies, such as Euros, American Dollars or British Pounds with their real IBAN / SWIFT codes, or Route numbers (ACH or ABA).
In this way, if you want, for example, a company to pay you in one of those currencies, it can normally do so by means of a local transfer to such account (at no cost to them), and you will receive that money in your multi-currency account from TransferWise.
The money stored in your TransferWise multi-currency account can be converted to almost any other currency, and/or sent to the bank account you need with its international transfer system; you can also spend it directly thanks to its third product: the TransferWise debit card, which connects to your multi-currency account to be able to spend the money stored in it.
You must consider three elements when making the transfer:
- EXCHANGE RATE
It is the real one, which you could find in Google Finance or in Yahoo Finance Currencies. Remember that the real exchange rate is not fixed, it varies every day, but this is not the fault of TransferWise but of the currency market.
- COMMISSION FOR SERVICE
It is different depending on the type of currency you want to convert, (for example, going from pound to euro is most profitable); in most cases this value is between 0.5% and 1%.
Keep in mind that this commission usually applies a minimum of around € 1 or € 2, so it is not worth making small transfers. This is the way TransferWise makes money, it is their business model.
Variable percentages and minimum fees seem complicated, but if you go to the TransferWise pricing page you will see the exact fees that would be charged based on the type of currency you want to transfer.
- COMMISSION FOR CARD PROCESSING
It will only appear when you use a certain type of card, and it varies depending on the type of currency you convert from. Please note that TransferWise does not benefit from this commission.
For further reference, please log on to https://transferwise.com/
