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Saving money on international payments as a remote freelancer (jurn.io)
376 points by 0verAchiever on April 13, 2020 | hide | past | favorite | 244 comments

FWIW, where possible, I advise having both a TransferWise account and a Revolut or Interactive Brokers account.

TransferWise is fantastic for receiving money. They have local bank accounts in USD, EUR, GBP, AUD, NZD and PLN. However for sending money and converting money, their fees can really suck: for $10k USD -> EUR (EURUSD is one of the most liquid forex pairs), they charge 81 USD in fees, or %0.8. Even for local transfers (which should be free) they charge ~1 USD.

Revolut is kinda crap for receiving money (the only local accounts are EUR and GBP, the rest are GB IBANs) but sending and conversion are both free (conversion as long as the amount is <$6k/month). If you use it a lot, they have a ~$100/yr plan that gives you unlimited on both.

Interactive Brokers is literally useless for sending and receiving money (they only accept transactions to/from your own accounts) but they're fantastic for conversion. They process your orders directly against the forex market and charge ~1USD per trade for the kinds of trades we're talking about. The downside is that their minimum account balance is pretty high (~$6k IIRC) and they have a $10/month "inactivity" fee if your balance is below $100k and you generate <$10/month in commissions. That said, if you need a brokerage account anyway, their currency conversion is a great bonus.

And finally, Charles Schwab is great in the US. They charge minimal markup on deposits and withdrawals in foreign currencies (~0.5-1% depending on amount) and they have a debit visa card with no international transaction fees and Visa's exchange rate (~0.3% spread). They're not the best around but they're really great if you don't want to put your money in the hands of a less-regulated FinTech company that has minimal deposit guarantees.

The Interactive Brokers $10/month inactivity fee is (kinda) no more - they have a new product called IBKR Lite that has no minimum balance or maintenance fee, but still supports forex: https://www.interactivebrokers.com/en/index.php?f=45500

True, and if you're in the US that might be a good choice. IBKR Lite is unfortunately US-only at the moment though.

>They process your orders directly against the forex market

Sorta. Orders below 25k are odd lots


From that page, it looks like odd lots are still transacted damn near the same rate. '1 to 2 basis points' off would be .01-.02% extra

Only true if there is sufficient liquidity. Outside of main market hours I've seen pretty thin liquidity in odd lots and thus wide spread (GBP/AUD).

I agree IB is still a pretty good way to go overall though

Is there somehow a way to receive with Transferwise and send with Revolut ? I guess not. Then how would it work having both ? Receive in Transferwise a bunch of payments, and once in a while send to your bank. Then once in a while send to revolut, and send smaller payments from there ?

Yes but the transfers between accounts can be fiddly. The options if I remember right are:

- All currencies: Top-up Revolut with the TransferWise debit card - this is free and IIRC works for all the currencies TransferWise supports receiving. However there are limits on both the TransferWise side (how much you can spend with the card) and the Revolut side (how much they permit you to top-up with a debit card). The latter limit increases as you use the card.

- EUR and GBP: Straight local bank transfer - costs ~$1 but only works for these two currencies.

- CHF: Local bank transfer as above - costs ~$1 but requires correctly entering the reference number.

- USD: SWIFT - costs ~$5 and takes around a week.

- AUD, NZD, PLN: Unsupported. Revolut only has a UK-based IBAN and TransferWise requires local account details for these currencies.

For Transferwise the "Borderless account" is much cheaper then the "Send money" option. I get a price of ~46USD when I convert 10K USD to EUR (instead of the 81 when using the "Send money" calculator: https://transferwise.com/no/pricing/

Am I correct in thinking that interactive brokers won't send from your brokerage account to someone else? If so I guess the process would be to send back to a Revolut account of yours in the target currency after conversion at IB and then send it to the recipient from Revolut /Transfer wise using a same currency transfer?


FYI Transferwise doesn't have NZD accounts currently, and they have no schedule for restoring them.

Really my one is working fine

Great post Jurn, thanks for participating in the effort against hidden exchange rate markups.

If you want to check for yourself how much you could save with TransferWise (or one of their competitors) vs banks or PayPal, we've built a comparison site for international money transfer: www.monito.com which compares live exchange rates and fees for any amount you'd like to transfer between two countries/currencies (e.g. US-Euro https://www.monito.com/send-money/united-states/netherlands/...)

Our initial goal was to help migrants save money when they support family back home, but the tool can be used by businesses/freelancers/travellers as well.

Let me know if I can be of any help in the comments, we've become payment geeks over the years!

I wanted to provide you feedback as well as alert others reading these comments. Your site doesn’t list anything other than Transferwise for transfers from India to USA, even though options like InstaRem and others exist. Based on this, I’m not sure how comprehensive your service is to compare providers for cross border transfers. I see you have InstaRem and others for some other currency combinations (including the inverse, sending money from USA to India).

Thanks for your feedback. Monito.com strives to list as many options as possible and be the most exhaustive source of information about international money transfer fees worldwide. However, we're not always able to access all data as no worldwide regulations require banks or money transfer services to be transparent about their fees and exchange rates (yet).

That being said, in the case of money transfers from India to the USA: InstaReM temporarily suspended money transfers from India last month. As soon as this is re-activated, they will once again appear in our comparison table on all supported corridors from India.

Thanks for the prompt response with details. If I may bother you one more time, do you have XE in your list of providers? It provides money transfers for many currency pairs (probably not as broad as Transferwise or InstaRem).

Yes we do. For example, they're the only service we know offering digital money transfers from Mexico to the US: https://www.monito.com/send-money/mexico/united-states/mxn/u...

For CAD-USD exchanges, Norbert's gambit is a popular procedure:

> Here’s how you can use this ETF to exchange $10,000 Canadian:

> 1. Get a quote for DLR and calculate how many shares you can buy for $10,000 Canadian.

> 2. Place an order for that number of shares. The trade will settle in Canadian dollars.

> 3. Call your discount brokerage’s customer service desk and ask them to take your DLR shares and “journal them over” to the U.S. dollar side of your account, where they should show up as DLR.U.

> 4. Place an order to sell all of your DLR.U shares. The trade will settle in U.S. dollars.

* https://www.moneysense.ca/magazine-archive/norberts-gambit-a...

* https://www.finiki.org/wiki/Norbert%27s_gambit

* https://canadiancouchpotato.com/2013/12/03/norberts-gambit-t...

Technically this would work with any interlisted stock, though the DLR ETF is very popular for this because of its liquidity. One could probably find stocks for GBP and EUR as well:

* https://www.tmxmoney.com/en/research/interlisted.html

The overhead of the exchange is the cost of buying/selling the stock, which is fixed price, so it it's not like a percentage cut.

Depending on where you live this could make your tax declaration more complicated, which could require the services of a tax consultant if you don't know how to do it yourself... Just something to keep in mind if you want to save money.

This is exactly how I transfer money between the US and Canada. Outside of Corona, it's easy to minimize this impact by choosing either bank stocks or indexes, and always after 1045 EST when the market jitter is done ~90% of the time.

> Technically this would work with any interlisted stock, though the DLR ETF is very popular for this because of its liquidity.

An interlisted bank/telecom stock has far more liquidity than DLR does.

This is a bit of a problem because you’ll pay at least half a cent or a cent in spread for your purchase and sale to the market makers. This adds up a lot more quickly on a $10 DLR than a $100 bank stock that’s liquid enough to have the same spread.

A 1cent spread costs you 0.1% for the buy and then again for the sale on DLR. On a $100 stock, it’s 0.01%.

DLR’s advantage is that it isn’t volatile because it only holds dollars and nothing else.

If you use a bank stock, the advantage is that you’re “in the market” during the duration of your trade. On average, that’s a plus, but you could lose/gain a few percent in the time it takes to journal.

The other disadvantage of DLR is that it does have a management fee. You shouldn’t hold it for long periods, but it’s another mark against DLR.

I’m a former TransferWise employee and I cannot speak more highly of them. Yes, they aim to make money like every business, but I’ve never seen a company so focused on transparency to customers. The CEO intensely interrogates roadmaps from the customer perspective, and fairness to customers is non-negotiable.

Their economy of scale enables them to offer increasingly lower fees, but I can speak first hand to the pain felt by everyone at the company when costs have to increase.

Anyway, I trust them far more than any bank and cannot recommend them more highly both as a customer and workplace.

Can confirm. I need to send payments from the US to ~30 international contractors per quarter. I generate a spreadsheet of their names and payment amounts. I click on their name in TransferWise's "saved recipients" page. I copy/paste the amount from the spreadsheet into the USD box, submit the payment, and then copy/paste the payment summary page into an email to the contractor verifying that I paid them. Couldn't be simpler than that.

All of my contractors have previously agreed to pay all fees associated with their payment, so I always type into the USD box. TransferWise withdraws exactly that amount from my bank and in 2-3 seconds tells me the amount that will be deposited into their account.

If hypothetically a new contractor wanted 1M RUB up-front, meaning that I would be responsible for payment fees, I'd simply paste 1000000 into the RUB box, and the recipient will get that exact amount, while TransferWise will calculate and tell me the USD amount to be deducted in my bank. Also couldn't be simpler.

PayPal makes this a nightmare. In order to make a payment such that exactly $1000 USD is withdrawn from my bank, I have to basically apply Newton's algorithm (or successive guessing) to the Send Money page (with each load time being ~30 seconds), because the number you enter is post-fees but pre-exchange. They couldn't have chosen a more useless variable for me to input, since I'd only either want to enter an amount pre-everything in USD or post-everything in RUB. I don't want to enter some weird intermediate amount.

With so many international contractors (possibly spread out over different countries and jurisdictions), how do you keep track of your possible tax consequences in both your own and their jurisdictions? How do you ensure you don't become liable to treat them as employees in your and their jurisdictions? Asking out of curiosity, because interested in hiring remote contractors across the globe but fearing possible tax complexity.

Because our contractors provide us a 1-6 month, non-full-time, packaged, isolated service by an agreed deadline for a lump sum, they're very far from the definition of an employee in all countries, so it's not a problem with us. However, if your company starts directing tasks, or otherwise starts creeping toward the fine line, then what happens is out of my expertise, sorry. My useless advice is to stay far from the line, but of course some businesses might not be able to easily do this.

I will chime in here as well. They seem to manage their relationship with banks rather well. When I was working in the wire unit, everything was usually ready to go in a way requested by the bank and despite working on another continent, any issues tended to be resolved the same day. I never dealt with them as a customer though.

> All of my contractors have previously agreed to pay all fees associated with their payment

out of curiosity, do you have an estimate of how much are those fees?

You're asking about TransferWise? Says on their website. https://transferwise.com/

woah, TransferWise transparency is no joke!

"fairness to customers is non-negotiable" .... yeah, unless you run a VoIP company. In which case you get told VoIP is against TransferWise AUP and you get told your business account is suspended permanently. And yes, we are talking about a reputable long-established VoIP company here, not some fly-by-night spam operation.

Similarly, the TransferWise business account is a bit of a joke. Features that should have been there on day one were not there, and are still not there. Things like multiple signatories, the sort of thing you take for granted at a real bank.

Additionally "Borderless" is marketing hype. You can only actually deposit in a small number of the available currencies. You're better off with a real bank.

Or the half-hearted implementation of M-PESA. Using Transferwise you can only pay private individuals on M-PESA. Paying businesses on M-PESA is impossible because TransferWise are not correctly integrated.

Need I go on ?

Not saying avoid TransferWise. I'm just saying caveat emptor, look beyond the marketing hype.

Actually thrilled to hear Voip is considered high risk!!

A ton of scam / fraud calls into the US are done using overseas garbage voip providers who do nothing to try to reduce the impact their crap has on individuals.


Thank you for not bothering to read my post. You know, the bit where I said "long-established reputable, not fly-by-night".

You know, the bit where I am talking about a long-established company with offices in the US and Europe ? A company that is regulated in all juristictions, pays its taxes and obeys all laws ?

You know, the bit where I talk about a company that hates "crap" on their network as much as you hate receiving it.

You know, the company that actively takes steps to identify and deal with miscreants on its network ?

Well of course not, because you want to tarnish all VOIP providers with the same brush !

I have similarly been bitten by them. I tried to test the service by transferring $40ish or something small like that that from one of my accounts to another, and they told me they're not doing it and are shutting my account permanently, but they can't tell me why.

This was my first transfer on my first ever account with them, it's not like I had any prior history with them.


This. It is so absolutely, positively, disgustingly maddening to see companies like Stripe, Paypal, now apparently transferwise as well, based on this and other comments I've read, simply freeze accounts for seemingly trivial "violations" of some obscure TOC and then not only permanently ban you for what was in 99% of cases an honest mistake, but also simply refuse to state why they do so. What is the bloody fucking point of rules that cause you to kick off customers if you can't even give some transparency on how those rules work. It's insane and even if it complies with some bullshit government regulations on money laundering, grotesquely shitty of major financial services companies. Users should at least be given the benefit of the doubt and told why they're being punished before being booted.

I'd love to see some insider of these companies explain the obsessive habit of booting and then refusing to explain a single reason why.

I don't know the specifics of any of the companies you've listed, but I do know that financial institutions can't generally tell customers when they're doing something like filing a Suspicious Activity Report.

I suspect one such report got filed for me or a nonprofit I volunteered with when I came across the Canada-US border a few years back to deposit several Canada Post USD money orders plus a single US$20 bill into the nonprofit's US bank account, representing the cash receipts at a conference the nonprofit had held in Canada. (The Canada Post money orders were the CAD cash receipts converted to USD in a way that was safe for transport. We received the US$20 bill physically. Most of the money received for the conference was done via credit cards or PayPal, but not all.)

My reason for suspecting this is how many people came over to the teller's desk to help with handling the deposit, and how long it took with mostly periods of silence. But that said, the deposit happened just fine with no objections raised and no follow-up inquiries reaching me or the nonprofit.

So I don't know whether it happened - but I do know the bank couldn't confirm it if it had. Probably likewise if the same laws required closing an account.

If it's the company's choice without legal obligation, maybe it's just to avoid giving fraudsters information on what works and what doesn't work. Definitely a shitty experience for honest people caught in the mess.

> My reason for suspecting this is how many people came over to the teller's desk to help with handling the deposit, and how long it took with mostly periods of silence. But that said, the deposit happened just fine with no objections raised and no follow-up inquiries reaching me or the nonprofit.

Just confirming what I've read: you suspect that a report was filed, but your non-profit's account has not been closed by the bank?

Right. No consequences of any sort happened which were visible to me, which I'm glad about since everything in that transaction was legitimate and legal and traceable. (The non-profit has proper financial records and could confirm details to investigators if asked.)

Many suspicious activity reports are filed defensively by banks to avoid the risk of getting regulators mad at them for not filing one if something shady did turn out to happen, not because of real individualized suspicions. Many aren't even looked at by investigators.

I wish you hadn't led with a "this" but man you put words to my heart.

It is so brazenly unjust, it strikes me right at the firmament of my being. If this is AML and KYC and not the financial institutions, why aren't there advocacy groups standing up against this gross mistreatment?

Dude, if you sign up for a payment processor without reading the TOC, you are an idiot. Just straight up. It's a huge dependency of your business and you need to understand the rules. (Silent changes are much more problematic, and I think companies can be legitimately blamed for that.)

> What is the bloody fucking point of rules that cause you to kick off customers if you can't even give some transparency on how those rules work. It's insane and even if it complies with some bullshit government regulations on money laundering, grotesquely shitty of major financial services companies. Users should at least be given the benefit of the doubt and told why they're being punished before being booted.

Your problem here is with United States KYC & AML requirements, not with payments processors.

This is probably the best advertisement I have read. It's spot on about my concerns, heartfelt, empathetic and sincere. I really hope that PR firms don't pick this up. Would hate to seriously ponder if it's genuine or not. Oh damn, I'm already doing it. There's something to be said about cynicism and sincerity in today's world.

I am sure that dropping comments like this in threads on popular news aggregates has crossed the minds of many PR firms.

Even if this comment is genuine, culture within a company is temporary, and once a company has built up a trusted brand, the amount of money that can be made by taking advantage of this trust grows substantially.

Especially for fast growing companies built out of venture capital, most will eventually sell out. It becomes especially difficult to avoid these pressures after IPO.

Indeed, not to be too pessimistic but I have seen radical changes in company attitudes that came with only age, success, and/or failure. Same people, evolving circumstances.

As a general rule I look at the profile, emdowling has been a member since 2013, has a number of comments on different subjects, not a high reputation but no submissions, it seems most likely genuine to me.

The comment you're responding to seems genuine. However...

> I really hope that PR firms don't pick this up.

That ship sailed years ago, alas :(

I interviewed with them about two years ago right now and while I didn't accept their offer, I came away with nothing but the highest level of respect for them, their work, and their culture. Even in the interviews / offer stage, they made sure that I knew that everyone's primary priority would be the customer and building a great product. The concept of "building metrics to support your ideas" is a bit of a daunting one if you have to do it for every project, but it showed a level of respect for the user and transparency that I appreciated.

In addition, their interview included a debugging / code refactoring segment which felt more "real" than most other interviews that I've done, and hopefully provided a better signal to them.

I’ve been working remotely between NZ and the UK for the last 7 years. I was dealing with HSBC and then Barclays Wealth in the UK but recently started using the TransferWise Borderless account after Barclays wanted £40 a month account fees...

They make everything so painlessly easy. It could take a couple of days to get cash from the UK to NZ where it can be under an hour with TransferWise. I can’t sing their praises loud enough, especially after having the deal with UK banks

I am using TransferWise since a year now to support my digital nomad business. Couldn’t be happier — The app is beautiful, it always worked, transfers are quick, and it is even cheap. Support is great too.

Can’t thanks them enough for their business: traveling with my primitive European bank was a nightmare.

Are you able to offer any insight (top level, non-confidential, obvs) into how TransferWise works, behind-the-scenes?

i.e. how do they actually enact the exchange of the funds? Do they have a contract with one of the big investment banks? Do they work directly via Forex markets? Can they leverage their scale now to minimise actual exchange costs – for example internally matching up (say) a one customer transferring USD to EUR, and another transferring EUR to USD, so that TW’s costs are minimised?

In reality, internalised or not, TransferWise makes lot of money in fees. On InteractiveBrokers for example, you pay +/- 2.33 USD in total to convert 100'000 USD to EUR (+ 1 USD extra for withdrawal if you already did one this month).

TransferWise charges end-user 900 USD + spread for the same operation, which is rather comical when you see their ads "banks are scamming you"

> On InteractiveBrokers for example

That is not a consumer-friendly site. Is it even practical for the typical case TransferWise targets: sending a few payments a year, or a few a month?

The pricing page for foreign exchange has the cheapest category as under $1 billion -- is transferring $200 something they'd do? I don't know what a "basis point" is, or "trade value".


Interactive Brokers is by no means a replacement for TransferWise. It doesn't even permit you to send money to an account that isn't in your name.

That said, its currency conversion is the real deal. If you have an account with them (I do), you can convert as little or as much as you like and withdraw it to your own account elsewhere.

I wouldn't recommend opening an account there just for currency conversion but their brokerage offering is fantastic so I'd consider currency conversion a nice benefit that comes with that.

If you want a more direct comparison, Revolut does conversion for free if your amount is under 6k/month.

I'm not sure where in the provided link you found that, but I am not doubting you found something FX-related in there with $1 billion as a relevant number, since they serve lots of different professional populations.

But yes, they can exchange even a dollar or two. I've exchanged five figures a few times there between CAD and USD, as an American living in Canada and actively using a US credit card.

So far I've found them to be much more affordable than TransferWise, but equally, they are a very complicated broker to use, and it may not be worth the hassle just for FX. They have other benefits that make them worth the tradeoff for me, like good margin interest rates and the ability to provide tax forms complying with both the US and Canadian tax systems each year.

Well this page says something about trading less than $1 billion per month:


Yeah, that's indeed the link that the other poster meant to share. See my reply to their comment parallel to yours for more detailed thoughts and numbers.

Sorry, I think I pasted the wrong link.

From the homepage, Pricing → Commissions → Forex leads to the 1,000,000,000 cutoff.


Thanks. I guess you're right that people like me who don't trade billions per month pay their most expensive forex rates. But it's not a cutoff, just a price tier, and still far cheaper than TransferWise or any other option I know of for exchanging non-institutional quantities of currency.

To clarify the terms in that table: one basis point is 1/100 of 1%, as they themselves clarify in a footnote rather than assuming all readers know it. And trade value is, well, the amount you trade. :) The footnote for that term clarifies that they convert and charge this commission in whatever currency you have configured as the base currency for your account. (For example, I've chosen USD for my base currency since most of my transactions are US stocks on US exchanges, even though I'm in Canada and therefore the legal entity I'm officially dealing with is IB's Canadian arm.)

So, to convert anywhere up to US$100,000 (or its foreign currency equivalent) to any other currency, they charge their minimum fee of US$2 - mathematically, 2 / (1/100 of 0.20) = 100,000. Above that and up to US$1 billion, you take the amount you're trading, multiply by 1/100 of 0.20, and that's the fee.

$2 is a ridiculously low fee to convert five USD figures or less of currency, given that they also directly pass through the very tight exchange rates collectively quoted by their suppliers without building any profit for them into the rate itself.

You're absolutely right. I just mean that TransferWise has a lot of leeway in terms of pricing policy and that the actual cost of exchange itself is marginal (as counter-intuitive it may seems)

> TransferWise charges end-user 900 USD + spread

They don't charge spread. That's the entire point of Transferwise.

> On InteractiveBrokers for example, you pay +/- 2.33 USD in total to convert 100'000 USD to EUR

My understanding is that Interactive Brokers allows access to the forex market , indeed with a low fee, however Transferwise will use mid-market rate which is unattainable via the forex market.

It's trivially visible on Transferwise what are you paying, where can I see the same for Interactive Brokers ?

As someone who is interested in transferring money I will admit that I find InteractiveBrokers website confusing. I don't understand how it works. Let's say I want to buy Russian Rubles with US Dollars. How does that work? How do I get the Russian Rubles out? With TransferWise it is very obvious. I'd love to save more money but I'm not sure how to do it with InteractiveBrokers, but I would like to know.

They don't need to 'match up' individual transactions.

As long as they have a decent float in a bank account in each country, they can just do frequent (daily? hourly?) forex transactions to balance their reserves between countries.

At their scale, if the total amount sent by customers is X, then they probably transact 0.2X in the Forex market.

The frequency of the forex transactions will of course affect costs and exposure. Too frequent would increase transaction costs. Too infrequent and you risk exchange rates moving against you. Too infrequent and you need to hold more money in popular destination countries.

I hope I’m wrong because I want them to be successful but I’m less optimistic about the optimization potential.

I’d say that they are probably transacting 0.9X or something in that range.

Reason being that, I suspect, a lot of their transfer flow is from richer countries to poorer countries, as payments for services.

Of course that money flows back at some point, but as payments for goods shipped, which typically doesn’t happen through transfer wise.

You are right. 0.2X is reasonable for a transfer company with a more general audience.

I wonder what % of their total transaction costs are from FX spread and fees. Maybe, even at 0.9X, total transaction costs are dominated by local bank transfer fees.

> for example internally matching up (say) a one customer transferring USD to EUR, and another transferring EUR to USD, so that TW’s costs are minimised?

From what I've read, apparently that was their idea since inception, do their own reconciliation as far as they can.

Congrats to you - I love them. There's not too many companies that I feel so happy doing business with, serving such an obvious and vital need, and doing such a fine job of it. It's just a great product, really well done.

I just hope they don't get bought out :(

I don't know... the only time I tried to use Transferwise was to make a transfer to Haiti. Their website claims they support it, they allowed for the transfer to be initiated - but in the end it failed for some unknown opaque reason.

I'm sure it works for most large countries, but the reality is that they sell the idea that they can transfer anywhere, list almost every country to give the illusion of ubiquity, but haven't actually tested transfers to all those countries.

If they say they support it, it’s because they do support it. Problems are common in international bank transfer, that’s why their support team could have helped you. Your anecdata doesn’t prove that they don’t support this country, if it’s on their website it’s because they do.

The reply from support was that they don't support Haiti - despite the marketing on their website that they do.

Support was responsive.

Sometimes they support countries in some ways but not others. For example, as of when I last checked, they support sending Canadian dollars south to Mexico to be converted into Mexican pesos for delivery there, but not the reverse transaction.

I haven't seen many companies do what they do! They lower their fees without the customer asking! Most customers will not go comparing them to others, yet, when they can they reduce the fees and tell you how much more you are saving!

Wonderful ethics!

Can confirm that Transferwise is the best option out there for cross border commerce. Also stay away from Payoneer if you can. They eat 1-3% of the gross money transferred as commission, depending on the target currency. Also Payoneer's exchange rates aren't the best in the market. This is ridiculous when compared to TW.

Love Transferwise. Until a month or so ago I was using Xoom (paypal) and it was both more expensive and slower.

That's great to hear. I regularly use Transferwise and have always been happy with the service they provide.

Ya but remitly has far better rates every single time.

> fairness to customers is non-negotiable.

Nice try, TransferWise CEO.

I know someone who had their money frozen because they made the mistake of mentioning that the money being sent was for kava. You simply can't trust TransferWise to put their customers first.

So what you're saying is that their compliance and risk teams are on top of their game?

Kava is illegal/regulated in Europe and the UK and therefore the money and account would obviously be frozen pending an investigation.

Kava also means coffee in one of the European languages (Lithuanian).

On top of that it is legal in a lot of pacific islands.

Neither the sender or receiver had ever stepped foot in Europe or the UK and had anything to do with those jurisdictions.

Go read the Acceptable Usage Policy... nowhere in it will you find anything about every customer being subject to UK law. In fact they go out of their way to make you think the opposite is true... by showing you different AUP's depending on which country you're in.

You have something to do with the jurisdiction of the UK when you use a service based in the UK. Illegal drugs are clearly forbidden in the acceptable use policy, and the terms of use states English law is used.

UK law on kava (and many other drugs) is stupid, but that's not TransferWise's fault.

US/EU banking / antiterrorism regulations apply to any entity worldwide which wants to do business in the respective markets.

Assuming that there are two parties interested in doing a hawala exchange in two countries where this is legal, they still cannot (openly) use a bank that does business in US/EU because if the bank knowingly executes that transaction they could be facing serious fines.

Sure, but this is merely UK food safety regulation we're talking about. It is illegal in the UK to trade in kava for consumption (based on a German court decision that's since been thrown out). Kava is legal almost everywhere else in the world.

The grandparent comment is about how the CEO of TransferWise is obsessed with customer satisfaction. If X is banned on TransferWise, then TransferWise should say so in their AUP.

To simply lock accounts out of the blue is ridiculous.

You probably don't realize it, but you're making the case for using them even stronger.

Keeping a close eye on compliance/risk is going to help keep their transaction costs down, which keeps the cost of their service down for everyone else.

So what exactly do you want? The law might be stupid, I agree it's stupid, but it's the bloody law. You wanted TW to break the law just to help our your friend? Then guess what happens? No more TW.

It is literally the first item in the AUP that you're not allowed to use the service for anything unlawful. Of course they monitor that. They did everything right. And I'm sure your "friend" got their money back reasonably promptly after TW completed their review.

Criticism is fine, but taking a company to task for refusing to break the law for you is just silly. They didn't make the rules, and they'd be risking their own existence by breaking them.

> It is literally the first item in the AUP that you're not allowed to use the service for anything unlawful.

Again, kava isn't unlawful. It's a food product. The UK law says it is illegal to import kava for consumption, and illegal to trade in it in the UK.

TransferWise is neither trading in kava, nor importing it into the UK.

All they're doing is moving money from one person to another, neither of whom is in the UK or importing kava into the UK.

I am surprised that there is no mention of Bitcoin. My current project is also in another country (US) and I live in Europe. I am getting paid in BTC, and I pay even less then via Transferwise.

It is cheaper because the company already owns Bitcoin, so it doesn't need to buy them. What I do is:

- Getting BTC transferred to a wallet at an exchange I trust - Sell the BTC ones I receive them and put the money on my bank account

I switch between using Transferwise and BTC. The downsides are obviously that the price can fluctuate quite heavily. But my experience is that I saved a few hundred Euros each year (around 450 Euros) from using BTC instead of Transferwise.

That's not a lot in the grand scheme of things. What I like about a BTC transaction is that I can monitor it, it is even more transparent then Transferwise and I truly "own" the BTC ones sent.

It is a bit sad that I can't use it as much as I would like so I sell around 90% immediately to pay rent, buy stocks etc, and 10% stay there for future gains.

This has always been more of the dream of BTC than the reality. Transferring BTC around can cost 0.1 - 0.4% which becomes quite expensive. The cost of a wire transfer from Canada to the various countries I make them is a flat $36 - though receiving fees can be as high as $15 (CAD). That means that BTC only makes sense if you're transferring less than $5100.

But moreover, BTC back to fiat is significantly more expensive than "expensive" currency exchange with usually levels as high as 3%

The costs for transactions are not fixed to a percentage of the total amount sent but on the size of the transaction and the network congestion.

Moving one billion USD worth of BTC can cost as little as 0.065 BTC or ~440 USD.



> Moving one billion USD worth of BTC can cost as little as 0.065 BTC or ~440 USD

Which is ridiculous, given anyone (legally) moving a billion dollars pays zero for an instantaneous Fedwire.

If you want to convert between money, it's slight more expensive but marginally so (15k USD for converting 1B with IB, 8k if you change more than 5B per month)

Not familiar with Fedwire. Surely it won't be free to move fiat via any payment network.

Do you happen to have a source? PS: seems not to be available to retail customers?

The "Fedwire Funds Service" is the Federal Reserve's wire transfer payment system used to move USD. I'm actually writing an integration to it right this moment (the old fixed-width format, not the new XML one, yay). Naturally this interface is not available directly to retail customers, but if you actually send a wire transfer from your bank, this is the system you will use.

Your bank will generally make this available to you through some online interface. If not, you can visit the teller. They will likely charge you $20-$40 to send a wire if you are a small account, but, even with something like Chase's mid-level "Signature" checking (~$10-$20k minimum to avoid monthly fees iirc) they will waive this fee. And, of course, if you're really moving a billion, not only would you have a banking relationship where your wire fees are waived, that fee would be peanuts anyway.

Im in the EU and we don't have Fedwire here. I can tell you that ABN AMRO charges me ~10 euros for transferring ~200 eur to the UK (with conversion to GBP).

Generally speaking I'm quite familiar with payment infra in Europe, I've worked on it for ~20 years after all.

I am not sure how to engage with this reply. It is of course unsurprising that European banks do not have integrations with the Federal Reserve for moving USD. European banks often have access to international systems like SWIFT and SEPA, and various national payments systems, instead.

I have precious little information to offer you on the workings of European funds transfer services, however; I posted here to discuss Fedwire specifically, since you brought it up.

Well, first of all thank you for your earlier comment.

My anxiety is peaking lately... I have no idea exactly why I answered like that but what I meant was that while I'm not familiar with the US payment system, I do know the European one quite well and that's why earlier I'd expressed incredulity that any traditional banking system could offer zero cost transfers. I think I didn't notice you were not JumpCrisscross

I'd like to note that they overpaid ridiculously on that fee, they probably just didn't care about the fee since it was a rounding error.

Even $15 would have been too much, looking at other transactions in the block.

See, I did the calculations and it was cheaper to use BTC then to use Transferwise. BTC also worked faster for me then transferwise.

Of course, you already need to own Bitcoin. If not, the fees are slightly more expensive, but still cheaper then using "normal Banks".

Another factor with BTC is. If you receive the money in BTC and the exchange course happens to be relatively stable. Depending on your country, you will have a hard time converting this into your currency.

At a certain amount exchanges will ask a lot of questions (at least in Europe they do). And they want to see proof for the whole chain back, so you better hope your client can provide these infos as well.

And even if everything is 100% legit, you will wait a while for your money.

Not if you use something like Bisq to exchange BTC for fiat.

Personally I use Bitcoin to transfer money to my home country monthly. It's not much, around 1000-1500 euro (hopefully for just one more month), and it's to pay my credit card debt back home. It's very convenient, fast, and I get the best market price for my euros. Using Transferwise is out of the question since my homeland uses an artificial price for the dollar, and thus if I were to use them I'd lose on about 25% of my country's currency.

If $1 = 100 Homeland units through Bitcoin but only 75 Homeland units through currency conversion. Why don't you move 1000 dollars over and bring back $1333.33 and repeat?

It's probably done by government fiat and transferring homeland units to usd probably has a similar penalty to prevent such arbitrage.

Correct! Very surprised you got it!

To elaborate, there is a tax on buying dollars, so although the 'official' price is X, the true price is X + 30% if you want to buy.

I think there might be a possibility for arbitrage eventually, since sometimes the true price is lower than the price you might get for bitcoin but the difference is so minuscule that it would take years to make an interesting profit out of it. Also, it would be a pain in the ass to wire the transfer out of the country, since for example Transferwise doesn't allow you to send money in my homeland's currency, only receive.

The cool thing to me about Bitcoin is the setup for someone new who is unbanked is really quick. You can have someone in Zimbabwe with nothing but a cellphone download an open source Bitcoin wallet and send them money in 10 minutes. They can take this and withdraw cash from and ATM or use Bitcoin and you don't have to go through all the friction of international payments and banking.

Since it works with pub/priv key cryptography its a push model and so you can securely send money to anyone, anywhere, anytime. No bank needed.

I'm genuinely looking forward to a day that we can do this. Digitally transfer money between each other.

Right now, you are probably losing more money that Ttansferwise because it costs a considerable amount of money to convert them to Fiat currency.

Agree. Also, you loose money when you buy it. P2P transfer is extremely cheap, but on-ramp and off-ramp are horrible. That's why there are so many exchanges making money in Bitcoin business.

If you immediately sell 90% of it you may be better off getting USDC (or Euro equivalent) and buying bitcoin with the 10% so you dont have to sell such a large amount since fees in crypto are usually percentage based.

I believe fiat withdrawal fees / trading are a lot higher than transferwise fee, at least in my case. Which exchange do you use if I may ask?

I personally use Kraken. Deposit money is sometimes within the same day, and selling was never a problem: https://www.kraken.com/features/fee-schedule

I am not tight to them, but for me it's the less concerning option.

> Getting BTC transferred to a wallet at an exchange I trust

This has never been a good idea, unless you’ve been immediately selling upon receipt.

Do most people not expect to spend the money eventually? What else are you going to do with it?

Unless you are getting international transfers for the purpose of buying drugs or speculating/trading I completely disagree with this.

Have taken payment for consulting in BTC a few times and would always get it into a local exchange then sell/transfer out within an hour, it's pretty painless when you are all setup with the exchange, fee's on my end come to 0.8% total amount, not capped.

So $80 for a $10k payment in BTC, that's not including the senders fees, exchange movements and time spent. Looking at transferwise now they will do the same $10K from USD to AUD for $80.60

My point with Transferwise is also: They are not really transferring money. Whereas with BTC, you have a transaction. With Transferwise, they sum up all their transactions and do larger bulk transactions at the end of each month or quarter or whatever.

So with using BTC, you actually have the BTC when it is transferred. The banking system has to cheat itself to keep low fees and fast transaction times. With BTC, you may wait 10-15 minutes. With Fiat, you would usually wait a day or two. But, you can "cheat" your way through the system.

One way I don't get why people won't support BTC: It is a system where everyone can contribute, see every transaction and improve it. The banking system however is old, slow and deeply flawed. And there is no way of improving it. So yeah, even if BTC would be more expensive and slow, I would still use it more often then not, since it's software, and you can fix and improve software.

> This has never been a good idea, unless you’ve been immediately selling upon receipt.

It evens out over time.

> It is cheaper ... I sell around 90% immediately

Sorry, i am unconviced. Could you show the numbers including all costs and exposure times to fx risks from your client's BTC account to your landlords bank account and compare those to using e.g. Transferwise?

> Most of them are not classified as banks and run without banking licenses and governmental oversight. They are more convenient and cheaper but definitely a little riskier as well.

This is really misleading. (Disclosure: I work for a remittance provider.)

It's true that non-bank money service businesses do not operate as banks, but it's totally false that they "run without... governmental oversight" or are "a little riskier."

The level of government oversight of non-bank MSB's is extreme by the standards of anything but banking. For example in the US, you have to apply to each state government individually for a license to send transfers from that state. It takes years and is extremely onerous. Many of our applications ran into the hundreds of pages of paperwork and were followed by weeks of on-site examinations plus an intensity of financial auditing usually reserved for companies nearing IPO.

(In Europe the situation is better because MSB regulation happens at the EU level. This regulatory difference is a big part of why Europe has a much larger share of great fintech startups compared to other sectors.)

On risk, most regulators require money transmitters to insure their liabilities to customers so that, if they ever collapse, the insurer will be able to make their customers whole. In our case, we never have liabilities to customers (because we pay out instantly) but we still have to buy this insurance... kind of a belt-and-suspenders approach.

I was looking into this when I started freelancing on UpWork. I found that the best option for me was to have an US ACH account through TransferWise, otherwise I was looking at either high transfer fees, currency conversion fees or all of the above + a rate that is far off from the market rate.

With the current setup the only cost I have are the TransferWise fees for USD to EUR conversion when I send the money to my local bank.

You "lose" thousands of dollars per year on Upwork no matter what you do. But this is a non-issue in the end, am I right? That's why I used quotation, because I prefer having this loss on a high volume of work rather than work for pennies in my country and saving transaction fees.

In the end I don't care about these fees, it's the world we're living in and I prefer to have fun with my projects instead.

Instead of "loss" I consider it a service price for discoverability and the payment guarantees for hourly projects.

I also don't mind paying since so far it's been the best method to get projects for me so far.

Yes, the 20% definitely raises eyebrows. Uber charges 20%< Booking.com 15%, and Airbnb 5+10%, just to put a comparison.

I no longer use Upwork, and the "loss" is only one of the reasons. But it's probably the best way to find projects easily though.

I think this depends a lot on what kind of projects you take. If you do lots of small projects for many customers and rarely charge them more than $500 then the charges are indeed terrible.

If however you do more long term projects (I have one active project that has been open for 2 years) then you quickly get to the 10% charge.

I wish they reduced the amount of money you need to earn to enter 5% charge range (it's currently $10k AFAIK) and I imagine it's quite rare for freelancers to get there.

What I think is quite bad on UpWork when it comes to charges is the 'connects' that you have to pay for since last year I think. Last I checked it was up to $1 USD per project proposal, which might make it very difficult for some people to get their foot in.

Try going for long-term projects or creating relationship with your customers. Once you charge them more then 10k USD the rate is ~6%, which is quite nice to have 94 cents on a dollar. It's something Upwork actually encourages, opposite for Fiverr as example

If you reach 10K in payments, it means there's a good level of trust between two parties, at which point even the 5% charge is not necessary.

Their messaging and time tracking tools are mediocre at best, and they certainly aren't worth the 5% charge. Payments are held for a week, and it still costs money for the worker to withdraw them. Their local currency withdraw is 2-3% lower than Transferwise.

I have no problem using their messaging, it allows me and my clients to exchange information and upload files too.

The tracking tools is just as it should be. I don't want a keylogger, so the fact that they simply count keystrokes and mouse clicks is good enough to not step too much into privacy zone.

Payments are held for a week in order to allow the paying customer to analyze screenshots, and if necessary to allow for complaints to be filed.

As for local currency withdrawal, I'd say they don't make a dime on that one at all. That's completely based on your local bank currency exchange rate, which is always skewed for them to make a buck too. Also they have plenty of different payment methods. And in the end it doesn't even matter.

Care to share any better online market for freelancers that you're happy with instead Upwork?

That's exactly what I said in my words, no?

I used to trade FX in my hedge fund, where of course we got interbank rates. The spread would have 5 decimal places for something like EURUSD, so 1.12345 bid, 1.12346 offered, based on mixed prices from different brokers.

I was astonished when I tried to change some money in the retail market and instead of the 5th decimal digit being different, it would be the 2nd.

Luckily these days there's several services that will give you something near the same spread, close enough to not care to search for improvements. Revolut does something like that, as does TW. I'm sure some of the other challenger banks are doing this as well.

Another big bonus is they don't force you to change your money. This is a big deal if you have an old bank like Barclays that will see your incoming USD and change it to GBP, losing you several percent in the process. If you have Revolut or TW you can actually just keep your USD, chances are there's something you pay for in dollars.

I see lots of praise for TransferWise here and I regret not trying them out earlier.

For what it's worth, I can add my two cents regarding PayPal. From a customer experience perspective, PayPal is pretty great - the UI is smooth and I like being able to pay with my PayPal balance online.

Having said that, their fees are nothing short of exorbitant - for international transfers, if I'm not mistaken, the fee is 4.4% + a fixed price per transaction + 2.5% on top of that if you also want to exchange currencies. A $1,000 bill paid to my PayPal account by a U.S.-based client can easily become $930 or even less by the time it reaches my bank account. I've stopped accepting payments via PayPal for that reason.

Furthermore - this isn't personal experience, just word on the street - I hear PayPal Customer Service can be pretty atrocious to merchants, which is another thing I'm not too happy about when it comes to their service.

PayPal's customer service is atrocious to consumers as well, especially if you fall between the gaps and get asked to do some weird KYC.

Two months ago, they asked me to provide charity information for my personal account, and subsequently limited my receiving/sending privileges.

Phone calls to them trying to sort this out have always ended up at some call centre in the Philippines, where the agents can only tell their users that the account limitation is "for their safety".

They've also limited the personal account of a friend of mine (who was interestingly enough ex-PayPal) before, also asking for charity information.

Over the last year or so it seems like TransferWise has rapidly come onto the scene & taken over much of the landscape for our international contractor payments. The fees tend to be much lower than existing alternatives; importantly, the administrative friction is incredibly low, too. We're able to handle international payments essentially the exact same way we do with most other vendor & contractor payments, via ACH transfers.

It's saved us a ton of time/hassle, even ignoring the fee savings (which have been somewhat substantial for most countries & currencies).

> Over the last year or so it seems like TransferWise has rapidly come onto the scene

They've also increased some of the fees over the last year

Depends on the currency. Mine has gone down.

If anyone is interested, CurrencyFair are another excellent way to save money on international payments. Similar to Transferwise, you can send money fast from one currency to another at the current exchange rate with far less fees than a bank.

They also have a peer-to-peer element, where you can choose your own exchange rate and wait for another customer (sending money in the opposite direction) to accept that rate. If you are willing to wait a little longer to send your money, you can get excellent value using this feature.

They currently have an excellent sign up offer at the moment that you can access using my link: https://www.currencyfair.com/rafland/?channel=RMZIY1

(Disclaimer: I currently work there. I love the product and I know you will too:))

+1 on recommending CurrencyFair - I've found that their fees tend to be lower than TransferWise and I've always had great service from them.

I've been using TransferWise since it started. It's just the best. Cheapest fee by far, excellent support. No affiliation here: I'm just a happy customer.

I second this. Been using TransferWise for a while (few years?), a very satisfied customer.

Their onboarding and ease-of-use are phenomenal - even for senior people who are not technically literate. I recommend it to friends, family, clients.

I've very high regards for TransferWise. Fastest and cheapest.

Meanwhile, Paypal is a frauster and should be mass-boycotted. So do Upwork.

Is it though? I recently compared it to Revolut (during a series of large-ish transfers), and TW turned out to be quite a bit more expensive, and no faster.

Revolut is not available to non-European and non-US citizens. I haven't tried it.

I just used TransferWise for the first time last night. I was legitimately impressed with their well-designed UI/UX.

My bank doesn't even have an online interface for international wire transfers, plus, their UI looks like something developed in coldfusion by an ex-myspace engineer.

TransferWise customer for over 5 years now, they are the best in the market.

Based on my own experience doing international transfer over many years, the article is pretty accurate. However there is another option, but it does have more risk. Bitcoin. I'm not much of a fan of cryptocurrency in the first place. But international money transfers with low fees is the first real use that actually justifies Bitcoin for me. My credit union charges $20 for a wire transfer. And the transaction fees of my Bitcoin exchange in my target country are low. The risk is the one to two hour window that it takes to transfer the Bitcoin. If prices suddenly drop in that time, I could be in trouble.

Are stablecoins viable in the real world for this kind of use case? Anyone have any firsthand experience?

I live in Argentina and have been getting paid in Dai (stablecoin on Ethereum) for over 2 years.


I'm also in Argentina. Do you use a service or provider for this? How do you turn your DAI into cash? Thanks for your insight!

Unfortunately the viability of this is going to depend a lot on what country you are trying to transfer to. In my destination country of choice (population > 200m) there are two small exchanges and four cryptocurrencies you can trade.

Just to add a dissenting voice to the conversation, I recently attempted to transfer some money with transferwise and they refused just after I had uploaded all of my ID etc. In the end I went with worldremit and they were much easier to deal with. Slightly more expensive but I'd choose that over the hassle of tw.

To add another voice, I spent several weeks in Bulgaria unable to use my Transferwise "borderless" card in any shops (including all the major ones, like Lidl and DM).

The first few times Transferwise insisted it's a broken card reader, then a few calls and emails later it became the merchant's terminal that's at fault.

On some of the calls, Transferwise simply hung up on me when I didn't take "you should try it again" for an answer.

Finally after escalation it became the terminal's providing bank, which didn't recognize my Transferwise card number (issued in New Zealand).

Meanwhile other people used their Transferwise cards at the same locations mine failed. So I requested a European version of my Transferwise card but TW insisted that would break their contract with Mastercard or something.

3 or 4 weeks later, after I had already left Bulgaria, they emailed to update that my card would now be working.

Needless to say, I always travel with more than 1 provider's card with me, and this runaround from Transferwise is why.

Interesting, I had a similar issue with my NZ-issued TransferWise card, however it resolved itself in a few days. This was in Dubai airport & then across a few merchants in the UK, though.

I’m suspecting that the answer to my question would be no, but will still ask anyway. Did Transferwise give you any usable reason for their refusal or was it a blanket “sorry, we can’t do business with you” that many companies use for all kinds of reasons while hiding behind the garb of security and fraud?

We at Toptal initially created TopTracker payments (we don't monetize on this product at all) to be the lowest form of payments for freelancers globally by partnering with Payoneer. Essentially, it's a fixed 2% transfer cost including FX, however TransferWise is often able to beat that.

We, and I'm sure other companies, would love to partner with TransferWise, however they've yet to create API's that allows for a product to work with their system effectively. Once they do so, this will be a game changer for doing payroll globally.


A lot (most?) of the fintechs in the UK/EU seem to use TransferWise under the covers for their foreign currency exchange, and while I haven't used the api itself yet I have skimmed the docs for it and they seem detailed enough.

They (intentionally, afaict) don't provide a checkout flow, but there's still a lot there.

For doing payroll like transfers, especially with strong compliance, there's a lot of under the hood functionality required. Payoneer has spent over a decade creating this, while TransferWise still has a long ways to go.

Hi - we certainly do have an API at transferwise. I'm in the product team. Drop me a line at n at transferwise dot com.


My traditional bank is less expensive than that

Doesn't TopTracker payments require both freelancer and client to create a Payoneer account? Requiring clients to sign up for Payoneer is a huge barrier to adoption for your service.

Transferwise is cheap but Revolut is free. I pay the mid-market rate and no markup unless I want to convert currency on weekends. There is a 6000€ conversion limit that can be lifted for 8€/month.

I had a horrible experience with TransferWise. They silently canceled my account for suspected fraud after I'd sent my first transfer. No call, no emails, no questions. I didn't find out until days later when I went to check why my money hasn't been received yet - I was unable to login.

I am receiving SWIFT payments each months in EU as a commercial entity. I am invoicing in USD, providing a bank account number, where the money I receive are automatically converted to the local currency (not EUR).

Just checked the exchange rate on TransferWise and it seems it is way better than any bank exchange rate in my country (not EUR).

So, what I am concerned about right now is taxes. It seems I can create an USD bank account in US on the name of my company for free. Then I can invoice my customers in USD (as I currently do) and tell them to pay the invoice to the US bank account in TransferWise. Then I transfer the USD to my local bank account (in local currency, using TransferWise exchange rate). So far so good.

But what about my USD bank account in US - wouldn't I need to pay taxes for my USD income in a US bank account?

Depends on the tax and accounting laws of your country, but generally the taxable event happens when you invoice.

So I'm doing accounting in EUR and invoice 10,000 USD. For accounting purposes my 10,000 USD gets converted to EUR on the invoice date, at the ECB USDEUR exchange rate.

Then you hold that 10,000 USD for 2 months in your USD account, and the USDEUR exchange rate has dropped or increased 10% in that period. When you then exchange the USD into EUR, you'll generally pay tax on the exchange difference (= capital gain)

My Belgian bank accounts are all multi currency. I can hold, receive and send USD/EUR (and others if I wanted to).

Thanks, the exchange difference indeed looks like capital gain.

It may also be worth looking into whether you can open a Foreign Currency account with a bank where you're incorporated which is probably a lot simpler than opening one cross-border.

E.g. in the UK, Barclays offer these for a range of currencies:


Thanks, I can open an USD account, but then I need to pay fees for it and the currency exchange rate is not as good as TransferWise's rate.

Retail exchange rates are never good but talk to your bank. If you have enough volume to do they may allow you access to their own trading desk for a much better rate.

Can you open a USD bank account in with your own local bank? I know this works some places; it makes things much easier, and with sufficient funds your bank may let you trade directly on their desk which should get you within 0.5% or less of the spot rate. Wire fees shouldn't be much. SO this looks closest to what you do now but separates the sending money from the currency exchange parts.

However in the situation you describe if your economic activity isn't done in the US you probably won't owe tax on this but if your USD account bears interest, that would be considered US income. You may need to fill out US tax forms anyway, and it will depend on the tax treaties involved.

Currency fluctuation will results in capital gain/loss but you should talk to a knowledgeable accountant local to where you are filing taxes - in some cases this can be categorized equivalent to a bank fee (i.e. an expense), in some cases it has to be tracked as income.

I don't think you are liable for any taxes just because you have a bank account in some place. If your company is registered outside of the US and you are not an US citizen then you shouldn't have to pay taxes there but as someone in tgis thread said - better ask an accountant.

If you don't pay tax now it is my understanding you shouldn't pay tax after changing to Transferwise. The general rule is that tax is paid in the country where the work is carried out.

If you have doubts you should ask an accountant, rather than randoms on HN.

I thought USA charged income taxes on dollar earnings paid in USA too.

That aside, suppose I work nomadically, ssh in to a computer in USA, perform actions there ... where is the work carried out? It's it necessarily the location of the employee? So USA based remote workers can geographically move to a low tax regime and save money? How about if I'm in USA working for an offshore company using a desktop and systems located in that companies premises but again I dial in to a USA based client; seems my work is offshore, at the companies premises?

The answer to this is "it depends". This is really dependent on tax treaties and the nature of the work, it's as simple as where the computer is. The laws are basically set up to avoid setting up easy tax avoidance so it's not as simple as moving people around.

Depending on your situation (regulation and logistics), cryptocurrencies can be a good way to move money internationaly. I've used Bisq for that with success, though it's more involved than a simple KYC crypto exchange or the (usually costlier, right?) traditional banking methods.

From Brazil, I've used TransferWise until it became way more expensive than my regular bank to receive wire transfers.

My wife runs a small research startup in the UK and their clients are almost exclusively based in the developing world (ranging from the likes of Kenya to South Sudan and Myanmar).

They are having difficulties receiving payments from many clients because: * They're a small company so many traditional banks aren't interested in banking them because they perceive risk to be too high (I guess from an AML standpoint?) * TW does not support receiving funds from these countries.

There just doesn't seem to exist a reliable way to receive money from many of these countries. Does anyone know of a solution or bank that offers this kind of service?

His suggestions: 1. use transferwise.com 2. Open foreign currency account in your bank

Using the opportunity to pressure TW to expand into more markets. Why only focus on the EEA countries? Come on, expand onto whole Europe/world, if Payoneer/Skrill can do it, you can too.

Edit: make debit cards available anywhere.

Coverage is pretty comprehensive https://transferwise.com/ available in 59 countries (see half way down the home page)

The borderless bank account seems available in a ton of countires too - https://transferwise.com/gb/borderless/

I suppose being a European company, there are more regulations at play.

Payoneer is US based.

Skrill is UK based, and I don't think they have prepaid debit cards? Even if they do, nobody should use them. They were moneybookers once, and from first hand experience, they are highly unpredictable when it comes to fees and conversion rates.

Revolut is also European and doesn't offer debit cards throughout the world.

As a freelancer often working remotely: I have a great experience with Revolut Business.

From time to time I used TransferWise, and I am happy with the service. However, it is a transfer, not an account. For some contracts (universities in various places) a bank account is a must, so to fulfill local procedures. Revolut Business works like a bank account (including SWIFT transfer) with seamless exchanges between accounts. I created an account specifically to be paid in SGD (Singaporean dollar). If I used my "normal" bank account, the charges would be enormous (effective ~10%).

Transferwise now also provides a bank account with a proper IBAN and a Master card. I have been receiving my salary for the past six months in this account without issues. From last month, they also added Direct Debits feature. The only annoyance is that I can't use the Master card in many shops in Belgium because they only work with Bancontact cards.

Thank you for the update.

Last year it was not possible (and took me some time to discover that).

I connected TransferWise with my Xolo and N26 account.

If you have an online brokerage account, it can be possible to use that to exchange currency directly on the market, with the market exchange rate and very low fees. Obviously that isn't a one-step solution for clients paying you, but it can work very well if you have money in bank accounts in different countries, and they both integrate with your brokerage account in a low-fee way.

But how do you transfer between countries? The fees for wiring money or securities with brokers are higher than normal Bank transfers, at least where I live

FYI American worker: When an international employee makes $40 per hour and they perform two weeks of work -- their US employer sends them 80 * 40 = $3200. No Federal Income Tax Withholding, no Social Security and Medicare deductions, no Federal Unemployment (FUTA) Tax, no State withholdings, nothing. Employers love it. No drama.

Just straight gross cash.

Well, they likely need to pay income tax and social insurance in their own country. The burden has just been shifted to them.

To be fair, I’m not 100% sure how this works in the US, in PL where I’m from and probably in all of the EU countries if you are on a job contract then the employer pays the taxes and social insurance for you. If you are self-employed / freelance you have a business registered in your name and it’s your responsibility.

Either way, I don’t see how the taxman’s cut disappears. Also lot of countries have higher taxes + social insurance than the US.

If you really want to make a case, you can say that the contractors from a low-cost-of-living countries may undercut American workers (but then, if they work remotely I think they mostly undercut the office jobs, not “workers”) because they ask less money for the same.

Works pretty much the same in the US, too.

When we pay US contract labor, we generally send the "gross cash amount". The US contractor actually has to fill out a form upon commencement that says how their taxes & social insurance will be paid; at the end of the year they get a form from the businesses they did work for which shows total paid, and they use that to do their taxes.

Same thing for international contractors -- they just have to deal with their local jurisdiction's taxes, instead of the US IRS.

He is talking about avoiding paperwork & payroll management stress, not avoiding taxes per say.

This is just moving things around. The international employee deals with equivalent of withholding etc. It's exactly like a self-employed consultant/contractor locally, they should be factoring this into their hourly rate (including things like paying their accountants to sort out taxes, etc.).

If wage disparity is big enough, it can still be a "win".

Also it doesn't always work this way, often US companies have subsidiaries to handle payroll etc. in other countries.

Recent TransferWise horror story of a public company, processing millions, who had their account suddenly shutdown: https://blog.simwood.com/2020/03/emergency-bank-details-chan...

The TransferWise Acceptable Use Policy dated 24 July 2019 doesn’t allow VOIP business to use TW. The blog post from SimWood is from 19th March 2020.

I’ll leave it to TW to explain when they changed their AUP, how come SimWood s was able to use them later, and also for SimWood to explain how come they didn’t track the AUP changes at TW, and instead felt the account closure to be sudden.

I am the CEO of Routefusion (routefusion.co). While we don't handle individual international freelancer payments, we have the most comprehensive API for companies to send cross-border/international payments to contractors, or SMBs, etc. Based on my experience, here are some recommendations for whom I would use in no particular order.

Deel (letsdeel.com): They are an amazing option for paying and hiring freelancers/remote employees. They have a great feature where you can sign up as an individual contractor. They shine on their simplicity of onboarding and scheduling. They also offer a free consultation if you have tax questions etc.

Transferwise: They are great. If you are making individual payments you cannot go wrong. I wouldn't want to operate my payroll off of them, but they are great for one-off payments. (I used them to send payments to Italy for my wedding)

Pilot (pilot.co): Pilot makes it ridiculously easy to pay your international team members. They handle payroll, benefits, and compliance for international employees and contractors. They have some great tech behind their products, utilizing integrations like Plaid to get you up and running fast, they also beat TW in currency pricing all day.

Rippling (rippling.com) They have a great HR product and domestic payroll solution. They have recently launched an international payroll solution and it is just a great as their domestic.

Payoneer: Payoneer has been the industry standard for quite some time. I think the only downside is they are expensive (exchange rates are not competitive). Still would be a great option, but would not be my first option.

If you have any questions about moving money internationally, I would love to chat with you and answer them. Whether is helps Routefusion or not, more than happy to spread knowledge! :)

founders@routefusion.co https://www.linkedin.com/in/coltonseal/

I think you are missing the main point why so many prefer Payoneer. It's not about the fees, it's about having a card in a different country that your fiscal residency country.

Makes sense. They are a great company, so I imagine customers have lots of reasons for using them.

Hey - if you are interested in using the TransferWise API to power your payments drop me a line: n at tranferwise dot com


> As a remote freelancer you likely receive payments from other countries and convert these different currencies into your own currency

I do, but only when I really need to, because my country's money isn't worth the nickel it is imprinted on and devaluates all the time, so I'd rather keep my savings at $$.

I’ve been I’ve been using TransferWise and Revolut for GBP to Euro and vice-versa.

Revolut is the cheapest one and I can not understand the 50 euros charge as the exchange rate is super low.

Just checked my Revolt and 1000 USF to EUR is 1090,84, in google the exchange rate would bring me 1091,20. I don’t get your 50 euros difference.

Tangentially related: is there any payment gateway that allows one to accept international payments (for SAAS) paid out to transferwise accounts? I know paypal doesn't connect with TW. Is there any other gateway that does? Especially for Freelancers (not operating as a business).

For travel, is there any benefit to using TransferWise's debit card over a traditional debit/credit card that advertises 0 foreign transaction fees?

I remember somewhere about how the conversion rates are dictated by Visa/Mastercard on most credit/debit cards. Wondering how those rates compare to TransferWise's, and if their extra fee on top is justified.

Some examples: https://www.schwab.com/checking https://creditcards.chase.com/rewards-credit-cards/sapphire/...

Mastercard's FX rates are pretty competitive. Visa used to be expensive, but it seems they've caught up lately.

So in practice, the main difference is that Transferwise uses an instant "mid-market" rate at the time of the transaction, and then applies its fees (which are very reasonable on common pairs). Mastercard and Visa use a daily average rate that is not computed until the day after. In the end, Transferwise can sometimes be a little better, sometimes a little worse. They should all be within 0.1%. So, to answer your question, no it's not really worth it for you.

Only Revolut regularly beats everyone else since they don't charge any fee on top of their spot rate on most common pairs, except for the weekends.

In Norway when a bank advertises 0 transaction fees they skip roughly 1.8% that Visa charges for doing currency exchanges.

Visa doesn't charge this fee, it's your bank.

Visa and MC charges 0.6% on forex.

What is the secret sauce to TransferWise? Are banks greedy, or do they have access to an exchange market that nobody else does? I've avoided them because whenever I look up wire transfer fees I get their SEO'd blog posts, but it seems from this thread that they have a legitimately good product.

I use a local bank account for incoming wires so that, if there is a problem, I can go down to the bank and talk to someone in person instead of being subject to the customer service whims of a tech startup. For me, that's worth the $10/transfer fee (though I bill in USD so I don't see forex or origination fees).

The secret sauce is that TW doesn't actually do currency exchange.

They have their own pools of different currencies, and receive/disburse into/from those pools rather than selling/buying.

So if you send $100 to someone who will receive EU, TW doesn't actually change $100 into EU; they credit your $100 to their dollar pool, and pay the recipient from their EU pool. As long as the pool sizes remain well matched with the inflow/outflow in that currency, TW isn't actually having to deal with any currency conversion at all.

This is simultaneously similar to and utterly different from what banks have done for international transfers. The difference is that TW is free to take on the risk of the rates changing because the risk is reduced substantively.

That's really interesting!

They only support disbursements in six currencies (AUD, EUR, GBP, NZD, PLN, and USD), but they can accept eighteen currencies; presumably because they already have a large balance of those and they are relatively stable -- the one question mark for me would be PLN, but I would guess that it might be an important remote work market.

It seems the main difference is the lack of a requirement for an intermediate bank or banks; even a large international bank like HSBC might have to go through a third party for currency conversion in certain circumstances. It seems a lot easier if you are only making increases / decreases to your own balance sheet (cut out the middle man, no settlement requirements, etc).

Presumably you issue bonds to get the to do this with, which is relatively safe because it stays as cash and you know your churn rate. Does TransferWise have any levers they can pull besides halting disbursements in a given currency if there is a sudden devaluation, e.g. Poland goes bankrupt and PLN goes to zero?

> Are banks greedy

And Western Union.

*I've worked at one of the major remittance companies.

I used TW for a real estate purchase. It was fine, although I sent the money in stages, because money-in-transit is not covered by any deposit protection scheme.

My understanding is this applies to all of the services operating in this space, not just TW.

But the suggestion that banks are more expensive is not necessarily correct. My new bank charges nothing at all for IBAN transfers to my old bank in another country. Money usually arrives next day, or sometimes same day if sent early enough. The exchange rate seems to be the interbank rate and not a consumer rate, so it's all very simple and cheap.

Reminds me of the Kagi cheques I used to get via snail mail. Once I had a cheque of around 160 USD and got back less than half of it from my former bank, the Berliner Sparkasse. I went to the local branch and they kindly explained to me that every institution "in between" the "billing chain" for foreign cheques can siphon off an almost arbitrary transaction fee. I still think that was fraud.

Anyway, I opened an account at a US bank with branches in Germany and it cost me only the usual fee (which was still high, though). Nowadays I'm using Fastspring.

I use TransferWise for me as a private person. However, For my company I recently needed to pay a USD invoice ~$3.000 to a vendor who couldn't accept a credit card.

I looked into setting up TransferWise for my company, but half way through the validation process I decided to check what my bank charged. ~$30 with the actual exchange rate, compared to about ~$14 for Transferwise.

I applaud TransferWise for taking it to the banks, but saving ~$16 on the occasional international transaction for me isn't worth explaining to my accountant a random debit from my account.

> ~$30 with the actual exchange rate, compared to about ~$14 for Transferwise

I have never seen this (TW user here too!) and I transfer money pretty often. Are you sure the exchange rate was the same? Because that's how they get you - a fairly minimal charge (your $30, or often "free") but then pad out the exchange rate in their favour, sometimes up to 5%(!)

Or maybe you just have a really excellent bank. None of mine even come close. Hell, I've used TW to move between currencies in the same bank account because of the clip the fuckers wanted for the privilege of moving some numbers from column A to column B.

> I've used TW to move between currencies in the same bank account

How do you do this? Last I tried, TW didn't let me choose currencies (it used the default currency for the source/destination country)

It was SGD to USD and you're able to use SWIFT to any country for USD (so I just pointed it at the same Singapore bank). It was slightly more expensive but still less than DBS was going to charge.

It would definitely be nice if they opened that up a bit, plenty of countries these days can do multi-currencies.

Yep, the rate I got was equal to what ddg showed me, unless they're in on the scheme as well.

There are also accounting advantages to having fees explicitly charged, rather than baked into exchange rates. An explicit fee is something I can easily state as an expense for tax purposes.

At least in Europe, SEPA payments are visible abroad the next day (at least according to my experience from transferring to Germany and London from Finland), so that's not too slow.

Where "next day" can mean 4 days later if you initiate the transfer on a Friday afternoon.

I have an account with an Italian bank that offers multicurrency accounts (EUR, USD, CHF, GBP + others not activated by default). If I change 1000 EUR to USD now I get 1089.90 USD, if I try to change 1089.90 USD to EUR I get 993.80 EUR, so it seems the spread is less than 10 base points, which seems to be pretty much in line with Transferwise.

Also, given that I actually have a part of my account in USD that means I can wait and change money when I need it rather than when I invoice.

Interactive Brokers have quite low fx fees and ability to fund/withdraw in many currencies. Problem is it takes a while a to open an account and to clear funds.

I came to the same conclusion (I use Upwork -> TW -> My local bank, instead of Upwork -> local bank, because even with lower transfer amounts upwork's rate is so bad)

Although I've noticed an increase in fees over the year or so with TW, especially now. Next time I'm withdrawing from upwork I'm gonna compare rate/fees and check whether TW gives me better outcome. (I feel it might be not true anymore)

We've been doing this for 3 years and we sit within EUR, GBP and USD. Rather than doing immediate conversion I sit and wait for various rates to become profitable, im happy being in any of the 3 currencies and so usually oscillate between USD and GBP which has been very profitable in the last year making around 10% net over 3 transactions. Can highly recommend TransferWise.

I tried to use TW to transfer from a client’s UK bank account that was in USD, to my US bank account also in USD. I couldn’t find a way to choose this in the estimator, so I contacted tech support. They replied that this was a scenario they didn’t cover. I continue to get regular wires between the accounts, costs $25 in Interbank and my place charges an additional $10. ):

Might be cheaper for you to open a EUR account somewhere with low fees and do 2x transferwise than paying $35 per transfer

TW support told me they just don’t support an account in another country that isn’t in that country’s native currency. Which seemed odd. This was about a year ago.

TransferWise highly recommended. If you spend/receive money in multiple currencies, you can also track your money with Lunch Money app. Jen, founder was on the indie hackers podcast. I'm not affiliated with either service and i haven't used lunch money. I have had great experience using TransferWise for international payments

I have overseas clients whose accounts payables are completely inflexible and insist upon mailing me paper checks. I’m using a forex broker at the moment who gets me mid-market plus about 1.2% to convert into USD.

Does anyone have a better way to receive paper checks that doesn’t involve me establishing a bank account in the sending nation?

A happy TW customer here, too. Had my card skimmed in Thailand. All money recovered without much hassle.

An online payment of USD 150 generates USD 14 for the middlemen. Source: https://docs.sendwithses.com/random-stuff/enemy-at-the-billi...

TransferWise rocks. I save about 16 Euro on a transfer of 500 euros to Spanish bank from Norwegian krones. And it works within seconds. The saving comes mostly from fees that the Spanish bank charges to receive international payments.

I've been using CurrencyFair for over a decade and they've always been great.

I find TW amazing but it doesn't ship debit card to my country (due to my over complex government's legislation). Does anyone knows a bank (can be a fintech) that allows me to open an account all online?

Argentina? People have been recommending Payoneer (not a bank) or Dukascopy (online bank). As far as I know Payoneer still ships cards, I'm not sure about Dukascopy. You can open an account 100% online with both of them.

Thanks for your answer! The country is Brazil. Payoneer - fails to meet my needs because there's no direct way to deposit through a bank, even it's my own bank account. Ask someone else to deposit (by the billing service) every time I need is inviable. And it charges 1-3% per deposit by the costumer. So, I would end up paying that per deposit. Also, it’s too hacky. Dukascopy – I’m researching this one, you give the best answer so far. Allow non-residents to open an account, some fees nonexistent (monthly, annually or inactivity), doesn’t seem to be bureaucratic, the support seems good (even one for my native language is available), ship the card to my country, the bank seems really solid. Sounds really good. I’m finishing my review, looking for good and bad experiences of current uses and possible hidden fees. If you have anything to say about this bank, please, let me know too. :)

Sorry for replying a bit late, I'm new here and not getting notifications for replies is something I'm not used to. We have a similar problem with Payoneer, so many restrictions that it's very difficult to deposit to our banks so people go to Uruguay and use their ATMs to get cash or alternatively they use the Payoneer card to buy things. Unfortunately I have zero experience with Dukascopy, if you have a Reddit account you can try asking in /r/Argentina or /r/merval, some people there have accounts with that bank.

Yeah, the lack of notifications of hacker new is unsual. I did alot of research on Dukascopy, including on reddit. It seems that bank really fit my needs. Thank you very much for that suggestion.

I live in Japan and first heard of TransferWise from a friend moving to the States, but since I became a contractor last year most of my international clients use it, and it's always just worked.

Just use crypto.

sometimes you will do better with a wire and access to your banks trading desk (not retail exchange. Assumes you can hold an account in senders currency , but worth checking.

Just use remitly. The best rates I have found so far.

Transferwise is great.

One feature, I liked was Exchange rates alerts.

+1 Transferwise, great service! Happy customer.

+1 to Transferwise. I'm a happy customer too!)

tldr: guy compares stuff, says use transferwise.

.. and shares his affiliate link to transferwise at the end.

There is a simpler solution. Charge more money for your freelance work. Higher fees compound. Cost savings diminish. Even better higher fees select for better clients. Working for clients where profits depend on your cost savings is a race to the bottom. And when clients pay more you can afford to outsource the work of setting up cost savings processes instead of doing the work yourself. There's nothing wrong with saving money, but that's not the purpose of a business.

Yes, easy, just charge more! I wonder why doesn't everybody just do it? Because it's non-trivial, it involves risk and you might end up making less money!

While cost saving has almost no risk. Here's a relevant piece of the article:

> But what if it's a 6-month project and instead of billing them 1000 per month, you are billing them 10.000 per month?

> Now you could have saved €150 per month for 6 months, meaning you lost €900 just on currency conversion on this project. Ouch!

> It could very well be that you can buy a brand new MacBook Pro every few years with just the savings on your international payments.

A business is also not good if you just let money slip through your fingers.

Charging more is harder than shopping for ways to save money and less pleasurable than dreaming of new MacBooks. Yes there is risk. Mostly of rejection. And rejection is painful and saving money sounds like what a responsible adult does and charging more just because you can doesn’t come with universal social approval. Your clients know this if they are hard negotiating on fees they are using that knowledge to their advantage.

The premise of the scenario is the freelancer is absorbing the risks of currency exchange. The client is not compensating the freelancer for the currency risk. The only way the freelancer gets compensated is by charging more or placing the risk on the client by requiring payment in the freelancer’s local currency. Neither creates a dependency on a third party, their API’s, business model, or terms of service. All of those are a distraction from doing the things that are the basis of the business.

> charging more just because you can

You can try to charge more, but it's rarely obvious you will receive that extra money.

Currency risk is a cost of doing exports. Of course, sometimes it's also advantageous if your local currency is devaluing against the customer's currency.

This is only half right. By all means adding 20/hr to your rates is more viable that faffing about trying to reduce every $20 fee.

On the other hand, this problem is partly fees, partly rates. The fee part gets taken care of by making sure you can absorb them as cost of business. The rate part doesn't, it grows with your revenue. So it's bad business to ignore it.

Freelancers are in a weird place on this because of the size of income. Just handwaving with numbers, if you are exchanging 10k the most you can save is about $100 or so, not worth a lot of time. At 100k though it's often worth it. At a million in forex, you are being irresponsible not to chase a good rate.

So freelancers usually fall somewhere around the middle, where there are real savings possible but it isn't worth a ton of time. Personally the last time I did this sort of thing 15 minutes on the phone saved me a few thousand a year so worth it.

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