PayPal is a famous and easy to use app for making and receiving international payments. However, when it comes to currency conversion costs and exchange rates, PayPal isn't always the cheapest option.
The PayPal payment gateway has been used by many large and small businesses having online stores. If the merchant needs to send money to a foreign business partner, the rates PayPal charges for currency translation and international transfers will result in the business owner losing out on significant revenues. This is why many business owners are starting to send money to TransferWise and then making overseas transactions.
- Create a TransferWise account with a balance account that reflects the currency you want to transfer from PayPal. For example, if you have PayPal funds in USD, make sure you sign up for a USD TransferWise Balance account.
- Click on the option ‘Money‘ and then on ‘Transfer Money‘ in your PayPal account. If prompted, choose the transfer option ‘Standard‘.
- Link the TransferWise account by entering the required information and clicking on the option ‘Link a Bank Account‘. It is like adding a new bank account to your PayPal wallet.
- Select the option ‘Balance‘ from the menu in TransferWise and enter the details (e.g routing number and account number) of your balance account.
- You can now send funds from PayPal to TransferWise without incurring any fees.
- Wait for 2 business days for the funds to arrive in your TransferWise account.
- When the funds arrive in your TransferWise account, you can transfer them from the balance account to another account or platform of your choice. While transferring one currency from TransferWise to an account that holds a different currency may charge a fee, it will be significantly less than what PayPal and the big banks charge.
By using this method, you can avoid huge currency conversion costs and exchange rates.