Wise vs Paypal - International money transfer comparison

Minami Ishii
Last updated
March 24, 2025

When it comes to international money transfers, many people immediately think of PayPal. It’s a convenient service for sending money online or making purchases on e-commerce sites. However, PayPal isn’t the only service available for online international money transfers. In recent years, numerous services have emerged, and Wise is one of them.

Both PayPal and Wise allow you to use their services online, but each has unique features and differences. In this article, we’ll compare the two from various perspectives. By understanding what each service offers and aligning them with your needs, you can choose the most suitable option.

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Comparison: PayPal vs. Wise Overview

FeaturePayPalWise
Supported Currencies & Countries100+ currencies, 200+ countries and regions (*1)40 currencies, 160 countries
Debit Card
Online Payment
Business Account

(*1) Supported currencies and countries for payments. Bank deposits are available in 56 currencies, and payments can be received in 25 currencies. Japanese accounts can receive payments in 22 currencies.

When comparing the two, PayPal supports more currencies and operates more globally. However, for Japanese accounts, only 22 currencies are supported for receiving payments. On the other hand, Wise allows transfers, payments, and receipts in 40 currencies. Another major difference is that PayPal only supports transfers to other PayPal accounts, while Wise enables transfers from a Wise account to a bank account.

Wise also offers the issuance of a debit card, which can be used for payments and cash withdrawals. While PayPal does have cards available, they unfortunately cannot be issued in Japan. Instead, users can register their existing credit or debit cards to use PayPal.

A key feature of PayPal is its adoption as a payment method on e-commerce sites. If you operate an online store, having a PayPal Business Account allows you to integrate it as a payment option. Wise also offers a Business Account, but its features focus more on money management, such as payroll processing.

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Key Points When Comparing Wise and PayPal for International Transfers

FeaturePayPalWise
Exchange Rate Fee3–4%Uses mid-market rate, no exchange rate fee
Transfer Fee¥4990.68%~ (varies by currency)
Transfer TimeInstant~0–2 business days
Reviews (TrustPilot)★1.3 (27,653 reviews)★4.2 (200,628 reviews)
  • Exchange Rate Fees: PayPal’s exchange rate fees vary depending on whether the sender or recipient bears the cost—4% for the sender and 3% for the recipient. In contrast, Wise uses the mid-market rate and does not charge an exchange rate fee.

  • Transfer Fees: PayPal charges a fixed transfer fee of ¥499 per international transfer. It allows transfers of up to ¥1 million per transaction, with the fee remaining unchanged regardless of the amount. Wise’s transfer fees vary depending on the method and currency.

  • Transfer Time: Transfers to PayPal accounts are nearly instantaneous. However, transferring funds from a PayPal account to a bank account requires 3–5 business days. Wise completes transfers to any recipient within 0–2 business days.

  • Reviews: Wise has received a TrustPilot rating of 4.2, compared to PayPal’s 1.3. Wise also has nearly ten times the number of reviews, indicating broader and higher user satisfaction.

Pros and Cons of Each Service

PayPalWise

✅ Supports a large number of currencies and countries

✅ Offers payment functionality

✅ Allows business accounts

✅ Transfers are completed instantly

✅ Enables transactions at the real exchange rate

✅ Has lower fees

✅ Supports multi-currency holdings

✅ Allows transfers to bank accounts

✅ Provides local bank account details

✅ Accepts funds from accounts other than Wise

✅ Allows business accounts

❌ Relatively high fees

❌ Can only send money to PayPal accounts

❌ Withdrawals take time to process

❌ Fees vary depending on currency and transfer method

Which is Better: Wise or PayPal?

As shown above, both Wise and PayPal have unique features, and the better option depends on your purpose and environment. For example, if your friends or family are already PayPal users, you can easily send and receive money just by knowing their account details. On the other hand, if you plan to transact with multiple people, Wise is more convenient because it allows transfers to bank accounts.

Since PayPal supports more currencies for payments, it might be more suitable for frequent users of international e-commerce sites. However, Wise supports payments in 40 currencies and uses real exchange rates, meaning you only pay the minimum required fees. If the currency you plan to use is supported by Wise, it can be a more cost-effective and convenient choice.

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Company Background

PayPal was established in 1998 with the mission of making financial services accessible to everyone worldwide. As of March 2023, PayPal boasts over 430 million active accounts globally and has 35 million merchant accounts. In Japan, PayPal had 8.4 million active accounts as of 2021 and continues to increase its presence.

Wise, on the other hand, was founded in 2011 with the goal of making international money transfers cheaper and fairer. Initially focusing on international transfers, Wise has since expanded its offerings to include multi-currency accounts and debit cards. Today, Wise serves over 16 million users worldwide.

How to Make International Transfers with Wise and PayPal

Both Wise and PayPal allow international transfers to be completed online. Below are the steps for sending money via their apps, assuming you already have an account. If you don’t have an account, you’ll need to register first.

Steps for PayPal

  1. Log in to the app and select Pay.

  2. Enter the recipient’s email address.

  3. Input the transfer amount.

  4. Choose Personal Payment.

  5. On the confirmation screen, ensure Friends/Family Payment is selected, check the transfer amount, and complete the transaction.

Steps for Wise

  1. Log in to the app and tap Send on the home screen.

  2. Select the sending account.

  3. Choose the type of transfer (international or same-currency).

  4. Enter the transfer amount.

  5. Input the recipient’s details.

  6. Confirm the transfer details.

Comparison of Fees for International Transfers

Both Wise and PayPal charge fees depending on the services used. Here’s a detailed breakdown of the types of fees commonly associated with international transfers:

Common Fees for International Transfers

  • Transfer Fees: Charges for sending money, often specified as a fixed amount per transaction or as a percentage of the transfer amount.

  • Intermediary Bank Fees: When sending money internationally, banks use a network called SWIFT, which connects the sending bank and receiving bank via intermediary banks. The fees charged by these intermediary banks are known as intermediary bank fees.

  • Recipient Fees: Fees incurred by the recipient for receiving international transfers. These may be fixed per transaction or based on a percentage of the received amount.

  • Exchange Rate Fees: When the sending and receiving currencies differ, institutions often set their own exchange rates, which are higher than the actual market rates. The difference between the actual rate and the institution's rate represents the exchange rate fee.

  • Lifting Charges: Fees applied when no currency conversion is required, e.g., sending Japanese Yen to the US and the recipient receives the amount in Japanese Yen.

PayPal Fees Overview

PayPal accounts are free to open and maintain. Domestic transfers in Japanese Yen between Japanese accounts are also free of charge. However, when receiving international transfers, fees apply if the sender sets the exchange rate fee to be borne by the recipient.

Wise Account Opening and Maintenance

Wise accounts are free to open and maintain. Fees are incurred when adding money to the account, and these fees vary depending on the deposit method (bank transfer, credit card, or debit card). On the other hand, PayPal does not allow users to top up their accounts directly. Instead, users rely on balance transfers from others, direct debits, or payments/transfers using linked bank accounts or cards.

When receiving international transfers via Wise, there are no fees for receiving funds in the following currencies:

AUD, CAD, EUR, GBP, HUF, NZD, SGD, TRY, USD

Note: Excludes transfers received via SWIFT or wire transfer.

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Fee Comparison: PayPal vs. Wise

FeaturePayPalWise
Account Opening FeesFreeFree for personal accounts
Monthly FeesFreeFree
Account Top-up FeesNot available (*1)Varies by deposit method
Transfer FeesFree for domestic transfers0.68%~ (varies by currency)

¥499 per international transfer
Exchange Rate Fees3–4%Free (uses mid-market rate)
Receiving FeesFree (*2)Varies by receiving method and currency

(*1) Transfers are made directly from linked bank accounts or cards, not by topping up the account.(*2) When receiving foreign currency, a 4% exchange rate fee applies if the sender sets the fee to be borne by the recipient.

Currency Exchange Rate Comparison

PayPal uses its own exchange rates, which differ from the actual market rates. PayPal determines its exchange rate by adding a fee to the rates quoted by its partner banks. Users registered with PayPal can check the rates through the Currency Conversion Tool in their wallets.

Wise, on the other hand, adopts the mid-market rate, the midpoint between the buying and selling rates in currency exchange. This is the actual exchange rate without any markup. Wise adheres to its mission of providing fair and low-cost international transfers by not adding fees to exchange rates.

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Cost Comparison: Wise vs. PayPal

Below is a comparison of the recipient's amount when sending ¥100,000 and ¥500,000 in USD and EUR through Wise and PayPal:

Amount and CurrencyWisePayPalBetter Option
¥100,000 → USD$689.77$669.15Wise
¥500,000 → USD$3,451.43$3,345.75Wise
¥100,000 → EUR€629.02€611.72Wise
¥500,000 → EUR€3,146.86€3,058.62Wise
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Speed Comparison: Wise vs. PayPal

As mentioned, PayPal typically takes 3–5 business days for funds to be deposited, while Wise completes transfers within 0–2 business days. Although there may be minor variations depending on the destination country and currency, Wise is generally faster on average.

Deposit Methods Comparison

As mentioned earlier, PayPal does not allow users to top up their accounts directly. Instead, users link their bank accounts or cards to make transfers.

Wise allows deposits using debit cards or bank accounts. When transferring funds, users can also choose to send money directly from their bank accounts or debit cards instead of using their Wise balance.

Wise Card Availability

The Wise debit card can be used in most countries where debit cards are accepted. In addition to payments, it supports ATM withdrawals, ensuring you can access cash whenever needed. Within Japan, you can withdraw cash at ATMs located in AEON, FamilyMart, and Daily Yamazaki stores.

However, the card cannot be used in certain countries, such as Afghanistan, Belarus, and Cuba. It is recommended to check whether the Wise debit card is usable in your destination country before traveling abroad.

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Business Account Comparison: Wise vs. PayPal

Both Wise and PayPal offer business accounts, each with distinct features. Wise’s business account focuses on international transactions, allowing users to manage multiple currencies and make bulk payments. Upgrading from a free account to a paid account provides access to local bank account details in 10 currencies and enables receipt of payments through foreign banks, Amazon, and Stripe.

In contrast, PayPal’s business account stands out for its payment services. It allows merchants to integrate PayPal as a payment method for e-commerce sites, which can be beneficial for retail operations.

PayPalWise

• Free account setup

• No initial or monthly fees

• Payment services available


• Free account setup

• Additional services unlocked with upgrades

• Bulk payments for up to 1,000 recipients

• Manage up to 54 currencies

• Debit card issuance available

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Ease of Use

  • Account SetupBoth Wise and PayPal accounts can be set up online or through their apps.

  • Transfer MethodsPayPal allows transfers via direct debit from a bank account or credit card payments. You can also use the balance received from others. Wise offers transfers from bank accounts, debit cards, or the account balance.

  • Transfer DestinationsPayPal supports transfers only to other PayPal accounts. Wise, on the other hand, supports transfers both between accounts and directly to bank accounts.

  • Supported LanguagesBoth services are available in multiple languages, including Japanese.

  • Transfer LimitsBoth services allow transfers of up to ¥1,000,000 per transaction.

Supported Currencies

PayPal is available in over 200 countries and supports more than 100 currencies. However, Japanese accounts can only receive payments in 22 of these currencies.

Wise supports 40 currencies across 160 countries. Additionally, it provides local bank account details for 10 of these currencies.

Security

Both Wise and PayPal are registered with the Kanto Local Finance Bureau. This bureau operates under the Financial Services Agency and oversees the inspection and supervision of private financial institutions.

Customer Support Comparison

Both services offer online help pages addressing frequently asked questions:

PayPal provides support via online chat and phone. Users can also report issues through the Resolution Center on their account. Wise offers support via online chat, email, and phone.

Summary: Wise vs. PayPal

As we’ve seen, Wise and PayPal offer different services tailored to specific needs. Wise specializes in international transfers, focusing on low, transparent fees. It allows direct transfers to bank accounts, a feature that differentiates it significantly from PayPal. Wise also supports multi-currency holding and conversion, making it ideal for frequent foreign currency users, such as travelers.

PayPal, on the other hand, transfers funds to the recipient's PayPal account. If cash is needed, the recipient must transfer the funds to their bank account. PayPal's standout feature is its payment services, widely accepted across e-commerce platforms. It is a convenient option for frequent online shoppers.

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