Wise vs PayPal

Claire Millard
Şeyma Mektepli
Last updated
30 December 2022

Not sure whether to use PayPal or Wise for your next international payment? This PayPal Vs Wise review is here to help. We’ll cover:

  • A full side by side feature comparison

  • Which provider is cheaper?

  • Which is faster?

  • Which is safer?

  • Which gets better customer reviews?

Summary: PayPal supports more countries than TransferWise (now known as Wise). However, PayPal’s transfer costs aren’t always easy to figure out, and can include a fee of up to 4% added to the exchange rate. Wise has a more transparent fee structure, with fees often around 0.41% for major currencies. In our comparison Wise wins with cheaper overall costs and a better exchange rate. Both providers are licensed by Malaysia’s Central Bank, Malaysia Bank Negara.

PayPal Vs Wise: side by side

Send payments toSend to PayPal accounts in 200 countries80+ countries, 50+ currencies
Multi-currency accountsHold and convert 25 currencies in your PayPal accountAvailable for 54 currencies
Debit card availableNYes, Wise debit card
Credit availableNN
Pay later options direct with merchantsNN
Fully licensed and regulatedYY
Open a business accountYY
Learn more about Wise

So, to summarise:

  • PayPal supports payments to more countries, but you can only pay to another PayPal account.

  • Both PayPal and Wise offer options to hold and convert currencies - Wise accounts can handle more currencies

  • PayPal offers credit and pay later services to selected customers - Wise does not

  • Both providers are fully regulated, and offer both personal and business services

PayPal started as a payment platform for online shopping, and has related services such as credit for eligible account holders. You can also make domestic and international payments between PayPal accounts. Wise is a specialist in international payments to bank accounts, and offers safe, fast and low cost transfers which use the real exchange rate. If you’re looking to send money to someone’s bank account internationally, Wise probably offers better value than using a PayPal service.

The important bits

RatesExchange rate includes a markupMid-market exchange rate with no markup
Fees4.99 USD + up to 4% conversion fee + 3.4% of transfer amount + fixed feeLow fees, varies by destination
SpeedCan be instantVaries by destination
ServiceOnline & in appOnline & in app
SafetyFully regulated and licensedFully regulated and licensed

*If payment made by card

Rates: Wise uses the mid-market rate, whereas PayPal may charge currency conversion fees in the form of an exchange rate markup

Fees: Wise has variable fees which are based on the destination country, PayPal international payments from personal account have a 4% fee

4.99 USD transfer fee + up to 4% conversion fee, additional  3.4% of transfer amount + fixed fee if transferring by card

Speed: PayPal payments arrive almost instantly if you’re sending to someone who already has a PayPal account. Wise payments depends on the country you are sending money to

Service: Both providers offer multilingual service in a range of languages, online, in-app and by phone

Safety: Both providers are fully licensed and regulated

Learn more about Wise

Pros and cons

  • Global coverage

  • Send to PayPal accounts instantly

  • Send payments with just an email address of phone number

  • Mid-market exchange rates + low fees

  • Transparent pricing

  • Send to 70+ countries

  • Multi-currency  accounts for personal and business customers

  • Hold and manage 50+  currencies

  • Complex fees which are often high

  • Exchange rate markups

  • Only 25 available PayPal currencies

  • Send from one PayPal account to another only

  • Online and mobile payments only - no branches

  • No option for cash payments

  • Transfer fees vary by destination country

  • Accounts are not interest bearing

PayPal Vs Wise: The verdict

Whether PayPal or Wise win for you will depend on the specific services you need.

PayPal is a really popular and convenient way to shop online and send money quickly to friends. Making a domestic payment is often free - but when it comes to international payments, there are often hefty fees and an exchange rate markup. Transfers with PayPal are deposited into your recipient’s PayPal account - if they want to withdraw their payment they may need to wait several days for it to arrive in their bank account, or pay a fee for a faster withdrawal.

Wise is a specialist in transfers direct to bank accounts, and offers the mid-market exchange rate with low, transparent fees. Wise also offers a multi-currency account with a linked international debit card.

If Wise supports payments to the country you’re sending to, and you want your transfer to be delivered to a bank account, they may be your best bet.

Learn more about Wise

About PayPal and Wise

PayPal was founded in 1998, and has 337 million customers. You can send payments all over the world from one PayPal account to another. More recently PayPal has launched an alternative service - Xoom - which allows users to send to bank accounts and for cash collection, however the service is not available in Malaysia yet.

PayPal business accounts are ideal for merchants selling online - there are an increasing number of ways to accept PayPal payments offline too.

Wise was launched as TransferWise back in 2011 as a low-cost international payment provider. These days, Wise has upwards of 10 million customers, and also offers personal and business accounts to hold and manage currencies, accept payments and spend using a linked debit card.

With Wise you can send payments to 70+ countries, in 50+ currencies.

How do they work?

Sending money with PayPal

If you already have a PayPal account, it's easy to send money. Setting up a PayPal account only requires a few personal details and can be done entirely online or in the PayPal app. Here’s how to send money internationally:

  • Log into your account and select Send & Request

  • Enter the email address, mobile number or name of the recipient and click Next

  • Confirm whether you’re making a personal or business payment

  • Enter the amount, choose the currency and add a note

  • Click Continue

  • Select the payment method you want to use

  • Review and hit Send Money Now to complete your transaction

Sending money with Wise

To use Wise you’ll need to create an account, and depending on the type of payment you want to make you might need to provide some ID for verification.

Once your account is up and running make payments online and in the Wise app:

  1. Log into your account

  2. Type in how much you want to transfer, or how much you need the recipient to get

  3. Enter the recipient’s details - bank account number or email

  4. Check over the details

  5. Fund your payment using a card or bank transfer

  6. Confirm and your money will be on the move

Wise transfers are made through Wise’s network of local bank accounts, so they arrive faster and don’t incur intermediary fees. When you want to pay for your transfer in pounds you’ll send the money to Wise’s local UK account. Then Wise will make a payment of the equivalent amount in your preferred currency, from their account in the destination country. No money actually moves across borders, so it’s faster and cheaper than traditional international payments.

Go to Wise

PayPal Vs Wise Fees

PayPal international transfer fees are:

  • 4.99 USD transfer fee

  • Additional 3.4% of the transaction amount if payment made by card

  • Additional fixed fee of 2.00 MYR if payment made by card

If PayPal has to convert the currency there will also be a fee for this.

The currency conversion fee is a percentage fee added onto the exchange rate being used. You’ll be shown the exchange rate available when you arrange your payment - and you can also get an indicative rate through the PayPal online Help Centre. However, this markup in the exchange rate pushes up the overall cost of using PayPal for international transfers.

Wise doesn’t hide any fees in the exchange rates used, but instead has a couple of different transparent costs:

Fixed fee: covering the fixed costs associated with the transaction. For major currencies this can be in the region of 2.00 MYR if paying by card

Variable fee: covering the cost of the currency exchange. For major currencies this can be in the region of 3.4% of the transfer value if paying by card

Go to Wise

PayPal Vs Wise: which is cheaper?

Choosing an international payment specialist is almost certainly cheaper than sending money using your bank. However, as fees and rates do vary, it still pays to compare a few providers before you pick.

Let’s look at how a few different payments from PayPal and Wise work out. This table looks at how much in MYR it’ll cost you to send a payment to a friend in USD or EUR:

Amount & CurrencyPayPalWiseWinner?
MYR>1000 USD217.72 USD224.23 USDWise
MYR>5000 USD1,090.41 USD1,123.11 USDWise
MYR>1000 EUR203.62 EUR210.56 EURWise
MYR> 5000 EUR1,019.90 EUR1,054.45 EURWise

*Fees and exchange rates correct at time of research - 27 December 2022

**PayPal receiving amounts are not available on PayPal website, these figures were calculated based on PayPal’s published fee structure.

As you can see, on all our comparisons, Wise worked out cheaper - this is because of the currency conversion fees added to the PayPal exchange rate.

PayPal Vs Wise: which is faster?

When you send a PayPal international payment it is delivered to the recipient’s PayPal account almost instantly. They can then use the funds to shop online, or make payments to others. If they want to move the money to a bank account this may take time or incur fees, depending on where in the world they’re based.

Wise payment delivery time depends on where you’re sending money to, and how you want to pay. You’ll see an estimated arrival time when you set up your payment.

Go to Wise

Safety: Are they safe to use?

Both PayPal and Wise are fully licensed and regulated, and use both smart technology and dedicated service teams to keep customer money safe.

PayPal is globally regulated and one of the largest payment companies in the world. In Malaysia PayPal is regulated by Malaysia’s Central Bank, Malaysia Bank Negara, like most financial service companies in Malaysia.

Wise is regulated by Malaysia’s Central Bank, Malaysia Bank Negara in Malaysia, FCA in the UK, FinCEN in the US, and other global regulatory bodies around the world.

Ease of use

Creating an account: Create your account online or in app with both PayPal and Wise

Making a transfer: Make a PayPal international payment using a credit or debit card, bank transfer or your PayPal balance. Wise typically allows bank transfers, card payments and Apple Pay payments

Ways to send money: Send payments to your recipient’s bank account directly with Wise. PayPal transfers are deposited in the recipient’s PayPal account

Languages: Both PayPal and Wise offer multi-lingual support services

Minimum & maximum amounts: Sending limits can vary by destination country, and based on your account type

Supported currencies

PayPal supports 25 currencies for payments to PayPal accounts held in 200 countries and regions. Wise supports 50+ currencies, and lets you send payments to over 70 countries.

Conclusion: Whis is better Wise or PayPal?

When it comes to making international payments, the services offered by PayPal and Wise are pretty different.

Wise is a specialist in international transfers that are delivered directly to the recipient’s bank account. PayPal transfers are deposited in the recipient’s PayPal account - if they want to withdraw the money to their bank they may need to wait a few days or pay a fee.

The other major differentiator is on cost and transparency. Wise international transfers use the mid-market exchange rate with no markup, and a low fee. PayPal payments may have higher fees, and a currency conversion cost - a markup - is added into the available exchange rate. This means that sending money internationally with PayPal will probably work out to be more costly than using Wise.

Learn more about Wise

## FAQs on Wise and PayPal Comparison

Is PayPal or Wise cheaper?

For instant payments, Wise is cheaper, as it offers the real exchange rate with no markup, and low transfer fees.

Is PayPal or Wise faster?

PayPal transfers can arrive almost instantly in the recipient’s PayPal account - but withdrawing the money to a bank account may take a little longer. Wise payments depend on the country that you are sending money to.

How many currencies do PayPal and Wise support?

PayPal allows customers to hold a balance in 25 currencies and Wise supports 54 currencies.