Old School Western Union vs New Tech TransferWise:
Which is Really Cheaper?
Looking for better and cheaper ways to make an international money transfer? Find out which service is better, Western Union or TransferWise.
Western Union vs TransferWise: The Important Bits
Safety:One of the largest payment companies in the world
Rates: Vary depending on the situation
Fees: Fee vary depending on product, country etc
Speed: Also depends on the service you use but can instant
Service: Offer online, app and in-store support
Safety: Based in the UK, licensed and well backed
Rates: You receive the interbank exchange rate on google
Fees: Percentage based fee
Speed: 1-2 business days for most transfers
Service: Limited phone support but excellent online resources
Safety: Western Union is one of the oldest and largest money transfer companies in the world.
Rates: TransferWise gives the interbank rate and will always be better
Fees: TransferWise is clear and transparent. It's really hard to get an estimate on Western Union fees because they vary so much
Speed: Western Union is incredibly quick for services like cash pick up but are about the same as TransferWise for money transfers to a bank account
Service: Western Union has a huge network of physical stores making it easier to talk to someone in person. TransferWise has much better online support.
In so many ways, this is case of old vs new, but there is a lot more to it than just technology. TransferWise is definitely disrupting the remittance industry that Western Union has dominated for decades.
Western Union is still a really good option if you want someone to pick up cash. This is because of their incredibly large branch network. It's easy and quick to send cash abroad. It's just not cheap.
TransferWise on the other hand are a cheaper option for money transfers to a bank account. They don't allow you to send to as many countries as Western Union but they have most of the globe covered.
Learn more about Western Union
Learn more about TransferWise
The Australian Securities and Investments Commission (ASIC) is the government body that ensures and regulates fair and transparent conduct of financial services. Every financial service must be granted an Australian Financial Service (AFS) licence by ASIC to carry out business in Australia.
TransferWise are regulated by ASIC & AUSTRAC (AFSL 456295)
Like banks, money transfer providers usually make their money in two main ways: Firstly, the margin from which they purchase currency at a wholesale rate and the cost of currency sold on to customers. Secondly, an additional transaction fee.
In Western Union’s case, the exchange rate can be widely varied, depending on the currency, country, and method of payment. The company has a price estimator on its website that allows you to look up its exchange rates.
TransferWise sells currency to customers based on the mid-market exchange rate, which is the exchange rate bought at a wholesale price. The company makes its profit through fees instead.
Before making a decision, it is important to compare live exchange rates offered by each provider.
Here are three ways to compare the rates offered by Western Union, TransferWise and other providers:
Western Union’s fee structure depends on the country, currency and the way you send money to your recipient. You can choose to send money in cash for your recipient to pick up at a Western Union branch ($30 AUD fee for AUD to GBP, NZD or USD, and $25 AUD for AUD to INR) or through a direct bank transfer ($15 AUD fee when transferring AUD to GBP or NZD, and no fee when transferring AUD to INR) .
As mentioned above, fees are the primary way TransferWise makes money. That’s why it’s just as important to compare fees as well as exchange rates.
TransferWise charges 0.7% of transfer amounting up to AUD 10,000 (minimum fee AUD 2) and 0.7% on initial AUD 10,000 plus 0.5% on anything over.
Be mindful that there could be more fees involved than the ones mentioned here. You could be charged a cash advance fee by your card provider if paying by credit or debit. In addition, your recipient’s bank could charge a deposit fee or corresponding bank fee to deposit the funds.
Time For Transfer To Reach Recipient
The transfer speed depends on the amount and type of currency, country of transfer and turnaround time of your bank to clear payment.
Bank transfer from Australia to:
UK: 3 – 4 working days
New Zealand: 3 working days
|Between 1 – 3 working days|
Should you have any queries, you can contact Western Union at 1800 173 833 (within Australia) or +61 2 9231 9729 (outside Australia).
To get in touch with TransferWise Australia, call +61 28 0466 244 (within Australia).