For decades, PayPal has been helping millions of people transfer money. How does newer online money transfer service, Remitly, compare to the payments industry giant? Let’s take a look at fees, exchange rates and transfer speed to find out.
The information on this page is current as of April 7, 2022.
Which offers lower fees?
PayPal
It’s free to transfer money from your PayPal account or bank account to someone in Canada. It costs $2.99 to transfer from your PayPal account or bank account to someone living in the US or most European countries. For all other countries, the fee is $4.99.
If you pay by card instead, you’ll be charged an additional 2.9% of the transfer amount plus a small fixed fee (often under $0.50 CAD) based on the receiving currency. This makes it expensive to send large amounts if you need to pay by debit or credit. Instant Transfers cost an extra 1% (up to a maximum of $10.00).
Remitly
Remitly’s transfer fees often start between $1.99 and $3.99 but ultimately vary based on the destination country, transfer amount and the speed you select (Express or Economy).
Economy transfers are cheaper, but Express transfers arrive more quickly. $0 fees are available for some transfers.
Winner: RemitlyBoth PayPal and Remitly offer $0 fees for some transfers. But Remitly doesn’t charge a percentage-based fee, making it cheaper for large transfers. Additionally, Ria’s fees don’t change based on how you pay.
Which offers better exchange rates?
The midmarket rate is the “true” exchange rate between 2 currencies, or the real value of one currency when exchanged for another currency. The exchange rate you get from money transfer services like Remitly and PayPal is the midmarket rate minus a small fee worth a percentage of the midmarket rate. This fee is sometimes referred to as a markup on the exchange rate.
A lower exchange rate means more of your money is pocketed by the transfer service and your recipient gets less money. A higher exchange rate means the transfer service pockets less of your money and more goes to your recipient.
PayPal
We found that PayPal’s exchange rates are often under the midmarket rate by around 3.5% or more. For perspective, a 2-3% margin on the exchange rate means you could lose hundreds of dollars when sending $10,000 or more.
Here’s how PayPal’s exchange rate markup could work if you’re sending CAD to euros (EUR):
- If the midmarket rate is 1 CAD = 0.7311 EUR
- PayPal’s exchange rate might be 1 CAD = 0.7055 EUR (3.50% markup)
Remitly
When we checked, Remitly’s exchange rate margins for a number of popular currencies ranged from less than 1% to around 2.7%.
Here’s how Remitly’s exchange rate markup could work if you’re sending CAD to euros (EUR):
- If the mid-market rate is 1 CAD = 0.7311 EUR
- Remitly’s exchange rate might be 1 CAD = 0.72 EUR (1.52% markup)
Winner: RemitlyWe found that Remitly typically deducted a lower margin from the exchange rate than PayPal, although the exact rate you get from either service could differ depending on the type of transfer.
Which is faster?
PayPal
Standard transfers are free and take between 1 and 3 business days. Instant Transfers come with an additional 1% fee (up to a maximum of $10.00) but arrive within minutes.
Remitly
Remitly Economy transfers arrive within 3-5 business days. Express Transfers arrive within minutes but cost more.
Winner: PayPalBoth services offer options that transfer funds within minutes. However, PayPal’s free standard transfers arrive within a shorter time frame than Remitly’s cheapest transfer option.
PayPal vs. Remitly: Sending $500 to the Philippines
Here’s how fees, exchange rates and transfer speeds break down if you send $500 from Canada to the Philippines through PayPal and Remitly. In this example, we assume funds are sent to a bank account, payment is made by debit and the fee is paid on top of the sending amount (not deducted from it). This information is current as of April 7, 2022.
| PayPal | Remitly | |
|---|---|---|
Transfer fee | $19.86 | $6.99 |
Exchange rate | 1 CAD = 39.0173 PHP | 1 CAD = 40.60 PHP |
Transfer speed | 1-3 business days | 3-5 business days |
Total received | 19,508.65 PHP | 20,300.00 PHP |
In this case, Remitly offers a lower fee, a stronger exchange rate and more money in your recipient’s pocket. However, PayPal might be faster. It might also be cheaper if you paid from your PayPal account balance or by bank transfer instead of by debit (thereby eliminating the fee).
| PayPal | Remitly | |
|---|---|---|
Availability | Send to 200+ countries in 25 currencies | Send to 100+ countries |
Fees | If you pay from your PayPal or bank account balance:
If you pay by debit or credit, add 2.9% + fixed fee (often under $0.50 CAD) | Varies but often starts between $1.99 and $3.99. Some transfers come with $0 fees. |
Exchange rate margin | Typically around 3.5% or more | Typically less than 1% to around 2.7% or more |
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Check out our review of Xoom to learn more about how PayPal has positioned itself to stay competitive in the international money transfer services market.
Compare international money transfer services
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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Bottom line
Remitly tends to offer stronger exchange rates and lower fees. But you may get faster transfers with PayPal, which also supports sending to a wider range of countries (although in a limited number of currencies).
Learn more about convenient, cost-effective ways to send money overseas in our guide to international money transfers.
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