Wise vs CurrencyFair

Wise vs CurrencyFair. Which one is best for you and your needs? Which is the most affordable option if you need to send or receive money internationally?

Check out our analysis of the pros and cons of each money transfer company.

Wise is usually a better deal unless you can exchange directly with one of CurrencyFair's customers

Wise is an online service that specializes in helping you send money between two different currencies. They charge very competitive fees, but what is unusual about Wise is that they do not make a margin on the exchange rate.

CurrencyFair is unique because you enter the exchange rate you want and are paired with one of CurrencyFair's customers to conduct a transfer at that rate. Alternatively, if nobody matches this rate, you can bypass this method and convert your money at the best available rate offered by CurrencyFair.

Both Wise and CurrencyFair are excellent choices, but in general, CurrencyFair is better if you exchange with one of their customers at a below mid-market rate. Otherwise, Wise is a generally better deal. Here's why.

📢 Important: Wise Is the New Name for TransferWise

Until March 2021, Wise had been formerly called TransferWise. The company decided to change its name to broaden its appeal and encapsulate the full range of service it offers. While the name is different, it's important to note that the service is still the same, and you're still able to use the service as usual with the same set of login details that you used on TransferWise. See more here.

Fees & Exchange Rates: How Wise & CurrencyFair Compare

Here is how Wise works: you pay for your transfer from your bank account, debit or credit card and send funds directly to the recipient's bank account. Options vary according to the corridor; in other words, it depends on where you are sending money from and to. For example, if you are transferring money from the US to Mexico you also have the option to pay from your bank account via ACH (Automated Clearing House). Alternatively, if you are making a transfer from a number of countries in Europe, you can make a SOFORT transfer. All fees and exchange rates are transparent, and they are clearly indicated on the website when you make the transfer. Wise does the fee calculations for you and warns you when there may be a local bank fee (this is something they cannot control).

How CurrencyFair works: With CurrencyFair you can make an immediate transfer at the available exchange rate, or specify your desired exchange rate and wait to be matched with another CurrencyFair customer looking to exchange your desired currency. This is because they offer a unique service: it's a person-to-person currency exchange. They offer low fees and you can set your desired exchange rate, and can wait and see if you are matched with someone who wants to exchange money in the opposite direction. Once another CurrencyFair customer user is located (who wants to exchange in the other direction and is happy with the exchange rate you set), each person obtains this exchange rate. When there is a match, you can secure excellent rates. If there is no match, CurrencyFair jumps in and provides the money exchange (which is generally about 0.45% worse than the mid-market rate). You can pay via bank transfer or Irish debit card (that's right--anyone outside of Ireland only has the bank transfer option). After the currency conversion, the funds are deposited into the recipient's bank account.

Fees

Wise charges a percentage of your total transfer amount. This amount is roughly 0.6% to 1% of the transfer fees (it depends on the currency combination). There's no transaction fee if you pay via a traditional bank transfer. Paying via ACH? There's a 0.15% fee, or by debit or credit card there's generally a 0.3% to 2% fee. It's variable; according to Wise's website, "most banks charge an additional fee. These processing fees vary depending on the kind of card you use and where it was issued."

Depending on where you are transferring from, CurrencyFair charges a flat fee. For example, in Europe, it's a €3 transfer fee, for Uk customers it costs £2.50. If there is a customer match CurrencyFair will charge 0.25% or 0.3% (it varies according to the currency combination) of the total amount. If there no match with a competitive rate, CurrencyFair will match with you at a rate that is generally costs about 0.4% to 0.6% (as always, the percentage hinges on the currency combination).

So, depending on which way you’re exchanging, and the activity on the marketplace at that time, you’ll pay anywhere from as little as 0.1%, to 0.6%. 

Exchange Rates

Wise's exchange rate is based on the standard, mid-market rate. They don't add a margin on top of that rate, which is quite different from other money transfer providers.

Exchange rates are either set by each customer or by CurrencyFair, depending on whether or not there is a match.

Key Takeaways:

• Both are fantastic, it's almost a tie, but Wise is better simply because CurrencyFair is only better if you can exchange with one of their customers. Both Wise and CurrencyFair offer excellent exchange rates and transparent fees.
• Debit card payments are limited to people who hold an Irish debit card.
• In terms of exchange rates, Wise is normally the slightly better deal, because they always match the current mid-market rate.
• If you want to pay by debit or credit card but you don't hold an Irish debit card, then Wise is your best bet. Just keep in mind that debit and card payments incur additional fees.
• Our recommendation is that CurrencyFair is better if you opt to exchange with one of their customers and manage to secure a rate that is below the mid-market rate. If not, Wise is a generally better deal because you know for certain that you will get the mid-market rate.

"Both Wise and CurrencyFair offer excellent exchange rates and transparent fees, but Wise is more consistently a better deal."