Alternatives to Paypal
How to beat PayPal’s rates for international money transfers.
PayPal is popular, convenient and easy to use for sending money to others around the world, but on many fronts, it doesn’t compete with other online money transfer services.
How much less PayPal delivers from every $1,000 transferred
The following table shows how much less you’d receive from every $1,000 in an international money transfer through PayPal that was converted into each country’s native currency. Exchange rates were accurate as of 23 April 2018.
| Service | TorFX | OFX | PayPal |
|---|---|---|---|
| Amount received in the UK | GBP£545 | GBP£545 | GBP£515 |
| Amount received in the US | USD$764 | USD$764 | USD$734 |
| Amount received in New Zealand | NZD$1,061 | NZD$1,061 | NZD$1,005 |
| Amount received in China | CNY4,809 | CNY4,809 | N/A |
| Amount received in the Philippines | PHP39,855 | PHP39,855 | PHP38,050 |
You stand to gain close to 8% with a transfer specialist compared to what you’d get from PayPal.
PayPal charges a fee for any money that crosses national borders, and there’s an additional currency conversion fee if the money is exchanged between Canadian dollars and another currency. For money sent to the United Kingdom, for example, PayPal would charge a CAD $4.99 international transfer fee plus a currency conversion fee on top of the wholesale GBP exchange rate.
Note that PayPal’s fees are much higher if your funds are drawn from a credit or debit card instead of a bank account.
As one of the biggest online payment services around, PayPal can charge those fees because it quickly and easily connects you with more than 210 million other account holders across the globe, allowing you to send, receive and store money in 25 different currencies.
If you find yourself often sending or receiving funds outside of Canada, there may be alternatives to PayPal that could save you money.
Compare money transfers with zero online transfer fees.
Main findings
Based on our research of international money transfer options, TorFX fared best for sending money to the places Canadians use most. It’s a versatile provider with some of the best rates and a low minimum. If you’re sending a lot of money (more than $2,000), WorldFirst can sometimes get you slightly better rates in some currencies. OFX is another versatile and competitive service provider with a low minimum.
Each of these transfer specialists stands to save you close to 8% compared to what you’d get from PayPal.
PayPal vs TorFX
| Service | Speed | Minimum | Fee |
|---|---|---|---|
| TorFX | 1 day+ | $200 | $0 |
| PayPal | Minutes | $0 | $4.99 |
You can easily send money internationally with both PayPal and TorFX as each offers online transactions. With PayPal, funds will be delivered in just minutes, while the transfer will take at least one day with TorFX.
However, if the amount you wish to send overseas is more than TorFX’s minimum of $200, you can avoid PayPal’s fees, which are at least 3% to the places Canadians send money to most frequently (like the US and parts of Europe). TorFX doesn’t charge a fee for international money transfers, and its currency exchange rate often differs from PayPal’s. Check to see which is more competitive.
Go to TorFX Visit the TorFX website for a full quote >>
PayPal vs OFX
| Service | Speed | Minimum | Fee |
|---|---|---|---|
| OFX | 1 day+ | $250 | $0 |
| PayPal | Minutes | $0 | $4.99 |
OFX also offers frequent PayPal users a chance to eliminate having to pay fees with a minimum money transfer of $250. PayPal adds two fees to many international transfers, the first when money crosses national borders and the second when it needs to be converted to a different currency. OFX doesn’t charge a fee, and its currency exchange rate changes with the market. It’s definitely worth comparing rates between OFX and PayPal.
An OFX transaction can be completed online just like PayPal, but it will take longer to show up in the recipient’s bank account. An OFX transaction will take at least one day.
Go to OFX Visit the OFX website for a full quote >>
PayPal vs Western Union
| Service | Speed | Minimum | Fee |
|---|---|---|---|
| Western Union | Minutes (cash) vs. Days (bank) | $0 (Max: $7,500) | $4+ |
| PayPal | Minutes | $0 | $4.99 |
Western Union works a little differently than other money transfer services because it has a global network of locations where transferred money can be easily picked up. It also offers online transfers, just like PayPal. With both services, funds can be delivered as quickly as a few minutes if using a Western Union agent. Funds transferred to a bank account through Western Union could take a few days.
However, Western Union charges a flat fee for its international money transfers, while PayPal’s fees represent a percentage of the total amount sent – at least 3% to the places Canadians send money to most frequently. So depending upon how much you want to send overseas, Western Union could be the more affordable route. Its currency exchange rate often differs from PayPal’s as well. Check to see which represents the better deal. Note also that like PayPal, Western Union doesn’t require a minimum amount to be sent, but its maximum transfer amount is $7,500 per day.
Read our review for Western Union
Still looking for other options?
Our table below lets you compare services you can use to send money abroad. Compare fees, exchange rates and discounts from different money transfer services, and when you have made your choice, click Go to site.
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