We compare a popular service with a relative newcomer to see how they stack up on fees, rates and speed.
Both MoneyGram and TransferWise will get your money where it needs to go, but which one will end up in a better deal for you?
The fees and rates used in this comparison are accurate as of 20 November 2018.
Which has lower fees?
Fees vary depending on how much money you’re transferring, how you’re sending it and the country you’re sending it to. It’s difficult to pin down exactly how much you’ll pay to send money internationally without actually initiating a transfer.
As an example, to send $990 (the maximum amount you can send per day) to a cash pick-up location in India, you’ll pay $12 in fees. The same amount to the United States will cost you $5 in fees.
Fees depend on where and how you’re sending money. They range from 0.45–1.5% of your transaction and can sometimes be a bit higher, depending on the currency you’re transferring to. There’s also a small flat-fee with each transfer, that’s often only a few dollars.
TransferWise allows transfers above $990 per day, but for the purposes of comparison we’ll use the same amount. To send $990 to India, you’ll pay 0.7% of your transaction (or $7.56, including the $0.70 flat fee). To the US, the fee drops to 0.5% and a $0.75 fee, which ends up being $5.66 in fees.
You’ll pay less on fees when sending money with TransferWise, although MoneyGram might have lower fees for a couple of currencies.
Let’s crunch the numbers: Sending $990 to Vietnam
To put this more into context, let’s compare TransferWise and MoneyGram when sending a money transfer to Vietnam. Keep in mind that other currencies will have different fees and transfer times.
Sending $1,000 to Vietnam
|Exchange rate||1 CAD = VND 17,504||1 CAD = VND 17,347|
|Transfer speed||Instant||1 day|
|Total Vietnamese dong received||VND 17,090,578||VND 17,174,069|
|Receiver gets||83,491 less||83,491 more|
For both transfers, you end up getting more money with TransferWise. However, MoneyGram is the faster service, so it depends on what you’re transferring for. Keep in mind, the most money you can transfer per day with MoneyGram is $990. With TransferWise, you can send up to $9,500 for direct debit and $3,000 when you pay with a credit or debit card.
Which offers better exchange rates?
MoneyGram makes its money from transfer fees and by skewing the exchange rate for a profit, also referred to as adding a margin. The margin added could be anywhere between 0.6% and 10%, depending on where you’re sending. On average, it tends to be around the 5% mark added on the mid-market rate.
Exchange rates are where TransferWise shines. It’s one of the only money transfer services that offers you the mid-market rate. So if you’re sending $1,000 to the UK and the mid-market rate is 1 CAD = 0.66 EUR, that’s the rate you’re going to get.
There’s no denying the power of paying the mid-market rate. TransferWise wins in this category by quite a way with its mid-market rate offering.
Which is faster?
Delivery speed varies with transfer options. At an agent location or by phone, your transfer could be delivered in minutes (though with higher costs). In general, your cheaper options will take two to four business days for receipt. A bank transfer may take several days.
Depending on the currencies involved and your payment method, it could take up to four business days for your recipient to see your cash. Paying by card will get your transfer there almost instantly, but will incur an extra fee.
Your average transfer may take about the same time with both services, so we’re calling this one a tie.
|Payment methods||Receiving options||Minimum and maximum daily transfers||Transfer speeds||Currencies|
|MoneyGram||Bank transfer, credit card, debit card, cash||Bank account, cash pick-up location||Minimum: $1
|Within an hour||100+ currencies|
|TransferWise||Bank transfer, credit card, debit card||Bank account||Minimum: $1
Maximum: $3,000 – 9,500 depending on payment type
|1 - 2 days||45+ currencies|
You can either use MoneyGram online or at one of its agent locations around Canada. Once you enter how much and which currency you want to send, you’ll confirm the exchange rate and pay. MoneyGram will then convert and deliver your money to your recipient’s bank account or to a cash pick-up location.
TransferWise is solely online, which means you’ll need to create an account and be verified. To send money, select the currencies you are exchanging and indicate how much you want to send. After reviewing your rate and fee, money is pulled from your bank account.
TransferWise is the new kid on the block that offers easy, secure transfers online in over 40 currencies around the world. Real-time mid-market exchange rates and low fees crush MoneyGram’s often complicated fee structure.
But if you don’t have time on your side, you may opt to pay more with MoneyGram to get it there faster or in cash. Ultimately, you’ll need to compare your options to find the service that’s right for you.