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).
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.
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
> 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’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.
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.
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 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!
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?
> 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.
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"
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.
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)
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.
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.
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.
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.
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.
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.
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.
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 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.
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.
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.
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
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.
"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.
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.
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.
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?
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 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.
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 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.
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.
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.
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.
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.
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?
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.
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.
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.
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.
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.
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.
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).
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?
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.
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.
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:
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.
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).
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.
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.
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.
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.
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.
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?
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.
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?
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.
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.
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[ 6.1 ms ] story [ 248 ms ] threadIt's saved us a ton of time/hassle, even ignoring the fee savings (which have been somewhat substantial for most countries & currencies).
They've also increased some of the fees over the last year
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 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 $$.
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.
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.
> I really hope that PR firms don't pick this up.
That ship sailed years ago, alas :(
I just hope they don't get bought out :(
Wonderful ethics!
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?
From what I've read, apparently that was their idea since inception, do their own reconciliation as far as they can.
TransferWise charges end-user 900 USD + spread for the same operation, which is rather comical when you see their ads "banks are scamming you"
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".
https://www.interactivebrokers.com/en/index.php?f=4969
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.
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.
From the homepage, Pricing → Commissions → Forex leads to the 1,000,000,000 cutoff.
https://www.interactivebrokers.com/en/index.php?f=1590&p=fx
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.
https://www.interactivebrokers.com/en/index.php?f=1590&p=fx
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 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’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.
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.
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.
Kava is illegal/regulated in Europe and the UK and therefore the money and account would obviously be frozen pending an investigation.
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.
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.
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.
UK law on kava (and many other drugs) is stupid, but that's not TransferWise's fault.
On top of that it is legal in a lot of pacific islands.
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.
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.
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.
Can’t thanks them enough for their business: traveling with my primitive European bank was a nightmare.
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
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.
out of curiosity, do you have an estimate of how much are those fees?
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.
This was my first transfer on my first ever account with them, it's not like I had any prior history with them.
Woo.
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 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.
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?
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.
> 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.
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?
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'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.
Support was responsive.
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 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.
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.
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 would definitely be nice if they opened that up a bit, plenty of countries these days can do multi-currencies.
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.
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.
I also don't mind paying since so far it's been the best method to get projects for me so far.
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.
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.
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.
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?
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.
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.
https://www.youtube.com/watch?v=hHji4x5C1q0
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!
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.
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?
If you have doubts you should ask an accountant, rather than randoms on HN.
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?
E.g. in the UK, Barclays offer these for a range of currencies:
https://www.barclays.co.uk/business-banking/business-abroad/...
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).
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.
Meanwhile, Paypal is a frauster and should be mass-boycotted. So do Upwork.
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.
Edit: make debit cards available anywhere.
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.
The borderless bank account seems available in a ton of countires too - https://transferwise.com/gb/borderless/
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.
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%).
Last year it was not possible (and took me some time to discover that).
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?
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.
One feature, I liked was Exchange rates alerts.