Virtual Payment Methods And There Comparisons: PayPal vs Payoneer vs Transferwise
Virtual Payment Comparisons: PayPal vs Payoneer vs Transferwise
No matter whether you’
re experienced or just starting with running a remote team, making payments to remote workers is one of the most important things to worry about. We have clients that work with all major platforms so here’s our take on the most popular options:
re experienced or just starting with running a remote team, making payments to remote workers is one of the most important things to worry about. We have clients that work with all major platforms so here’s our take on the most popular options:
PayPal vs Payoneer vs TransferWise.
Here’s our breakdown of three of the most popular virtual payment services, to help you decide which one is the best for you.
Virtual Payment Options
Paypal
PayPal is one of the first online payment services. Founded in 1998, the company we now know as PayPal used to be called Confinity. Two years later, Confinity joined forces with X.com, an online banking company developed by the CEO of SpaceX and Tesla Motors, Elon Musk. PayPal has been operating under its name since 2002 and remains one of the most widely used payment systems globally.
PayPal is used all around the world for online transactions, as well as online shopping. In 2014, PayPal had 152 million active accounts. Since then, PayPal has extended its services to even more countries. PayPal’s user base continues to grow as a transaction system for both businesses and personal users.
Anyone can use PayPal without registering for a PayPal account. However, if you’re going to use PayPal on an ongoing basis, it’s much more convenient to open an account. Creating a PayPal account is easy and free of charge.
The transaction fees charged by PayPal vary depending on a number of factors. Some factors include whether you are using your bank account, PayPal balance, credit card or debit card. The fee can also vary depending on whether you’re transferring money within the same country or internationally. The transfer fees range from 0.3% to 7.4%. PayPal also charges currency conversion fees.
PayPal lets the sender decide whether transaction fees are charged to them or the sender. The PayPal Mass Payments service allows you to pay up to 5000 people at once with no monthly fees.
Transferwise
Launched in 2011, Transferwise is one of the newest services that provides virtual money transfers. Transferwise was developed by Skype’s first employee, Taavet Hinrikus, and Kristo Käärmann, a financial consultant. The founders’ intention with Transferwise was to ease their own problems when making international money transfers.
Transferwise does not yet provide integrations for eCommerce and online shopping. However, this money transfer service has gained a lot of attention as a solution to the high bank fees most would like to avoid. Transferwise converts your money at a mid-market rate. The transaction fees are deducted before the conversion takes place. Supporting 30 currencies and over 300 currency routes, Transferwise is a great platform for sending money abroad.
Transferwise also charges no registration fees for new users. You can register with your email address or make the most out of the one-click registration option by connecting Transferwise with your Google or Facebook account.
This online money transfer service charges no transfer fees for users making their first money transfer. Afterwards, Transferwise charges 1.5% of the amount for transfers up to $4999.99, and 1% of the amount for transfers of $5000.00 or more.
The reason people like Transferwise lies in the fast and simple transaction process. Unlike banks, Transferwise uses the mid-market currency exchange rate. Transferwise converts at the midpoint of buy and sell rates at the time of your transaction. Conversion fees start at 0.50% and go up depending on the currency. This makes Transferwise ideal for small transactions, but it gets significantly more expensive if you make bigger transfers.
Payoneer
Payoneer was founded in 2005, with its headquarters in New York. Some of the board members of Payoneer include the former president of Visa and former CEO of SWIFT. This company is a worldwide Member Service Provider of MasterCard. Some of the companies that use Payoneer include Google, Airbnb, iStockphoto and Fiverr.
Payoneer and its services are available in 200 countries and include over 100 currencies. This company provides online money transfers, as well as e-commerce services. Payoneer also has a referral program, giving away $25 to each party once your referral receives at least $100 for the first time. With the refillable Payoneer MasterCard debit cards, Payoneer is great for businesses and working individuals.
With Payoneer, there are two basic account types that you can register for. The first one charges no annual fees and permits you to withdraw money directly to your local bank account. The Payoneer account type that includes a prepaid Payoneer MasterCard charges an annual fee of $29.99. This account type is available only to individuals, not businesses.
Payoneer offers several different mass payout packages for companies. The Small Business package supports a minimum of 10 beneficiaries and at least $10K in monthly payouts. For the Corporate package, you need at least 20 beneficiaries and $80K in monthly payouts. The Enterprise package is for 200 or more beneficiaries with a minimum of $250K in monthly payouts.
Payoneer uses the midpoint of MasterCard’s official currency conversion rates. The transaction fees charged by Payoneer are $2.99 for a local bank transfer and $15 for a USD SWIFT transfer. Payoneer charges fees of $4 or 1% of the overall amount for transfers in USD and EUR, but the fees can’t exceed $10. With Payoneer, you can send money to your prepaid MasterCard, Paypal, or make a global bank transfer.
| PayPal | Payoneer | Transferwise | |
| Mass Payments | Yes | Yes | No |
| Currency Conversion | 26 | >100 | >300 |
| Speed of Payments | 3-5 days | 2 hours | 1-4 days |
| Cost | 0.3-7.4% | 1% | 1-1.5% |
The best solution for your business
The number of people working remotely keeps growing, and so does the number and size of remote teams. It’s easy to choose a payment system if you’re in charge of a small team that won’t grow in the foreseeable future. However, if you have a big remote team with employees from all over the world, the payment process is usually not that simple.
Subscribe ➜ shorturl.at/aoxAY
No comments