Compare a well-known payments giant to the newer Remitly and see which one can give you a better deal.
PayPal is a renowned and well-known service used by millions to pay online. But is the juggernaut as good when it comes to international money transfers? We compare Remitly and PayPal side-by-side to see which international transfer service comes out on top.
The fees and rates used in this comparison are accurate as of 21 July 2019.
Quick verdict
The “Rate” and “Amount Received” displayed are indicative rates that have been supplied by each brand or gathered by Finder.
Exchange rates are volatile and change often. As a result, the exchange rate listed on Finder may vary to the actual exchange rate quoted for the brand. Please confirm the actual exchange rate and mention “Finder” before you commit to a brand.
Which has lower fees?
Remitly
The Remitly fee structure is varied. Fees change depending on whether you do an “economy” or “express” transfer, what currency you’re transferring and how much you’re transferring.
Express transfers have higher fees, which tend to get higher the more you send. Slower economy transfers often stay quite low, around $2 to $4 no matter how much you send.
PayPal
There are 3 components to PayPal’s fee structure for sending international money transfers:
- A percentage of your transfer. Paying for a CAD transfer with your PayPal balance is completely free, however, if you want to send in another currency or pay with a debit or credit card, a 2.9% fee will apply.
- A flat fee based on the currency you’re sending. Sending a Canadian money transfer in USD or in currencies from most European countries will only cost $2.99. Sending in other currencies will cost $4.99.
- A nominal fee based on the currency you’re sending. A small fee – usually the equivalent of $0.50 CAD or less – will be charged in the currency in which you’re transferring.
Note that if you pay out of your PayPal balance instead of using a credit or debit card, you won’t have to pay the 2.9% fee or the nominal fee. You’ll simply pay either $2.99 or $4.99, depending on the currency being transferred.
Winner: Remitly
Unless you’re paying out of your PayPal account balance, PayPal’s fee structure is based on a percentage of the amount you’re sending. The fees for very small transfers can therefore be cheap but will add up significantly for larger transfers. In most cases, Remitly will likely be the more affordable option.
Let’s crunch the numbers: Sending $1,000 to Brazil
Let’s compare a $1,000 transaction to see which provider wins out when fees and exchange rates are taken into consideration.
For the purpose of this comparison, we’ll calculate it based on a bank account transfer, and a Remitly “express” transfer so that your money is getting there in the same amount of time.
Sending $1,000 to Brazil
| Remitly | PayPal | |
|---|---|---|
| Transfer fee | $19.99 | $34.20 (0.29% + $4.99 + $0.21 CAD fixed fee) |
| Exchange rate | 1 CAD = 2.8400 BRL | 1 CAD = 2.7376 BRL (includes 4.61% currency conversion fee) |
| Transfer speed | Same day | 1 day |
| Total Philippine Peso received | BRL2,783.23 | BRL2,721.20 |
| Receiver gets | BRL62.03 more | BRL62.03 less |
In the end, Remitly saves you BRL 62.03 (over $20 CAD), as both the fee and exchange rate are better. Keep in mind that if you were doing an economy transfer with Remitly, you could save even more on fees.
Which offers better exchange rates?
Remitly
Remitly doesn’t have a standard rate rule, meaning the exchange rates they offer vary greatly and change daily. There’s a margin added to most exchange rates, but that margin varies currency to currency and normally ranges between 0.4% and 2%.
For example, if you want to send money to South Africa:
- Mid-market rate: 1 CAD = 39.1225 PHP
- Remitly’s exchange rate: 1 CAD = 38.8900 PHP
This is a margin of 0.59%.
PayPal
PayPal’s exchange rates also include a margin. If you’re transferring to US, it’s at least 3.0% above the exchange rate. To all other currencies, it’s at least 3.5% above the exchange rate. If you use your credit card to send a payment, you can usually opt to use your credit card provider’s conversion rate instead of PayPal’s, but remember to check your credit card provider’s exchange rate first – its rates may be even less favourable.
For example, if you want to send money to the Philippines with PayPal:
- Mid-market rate: 1 CAD = 39.1225 PHP
- PayPal’s exchange rate: 1 CAD = 37.4803 PHP
This is a margin of 4.20%.
Winner: Remitly
While Remitly’s exchange rates vary based on the currency, the margin is lower than PayPal’s overall. It’s always worthwhile comparing based on the currency you’re transferring, but it’s likely Remitly will net you a better rate.
Which is faster?
Remitly
Remitly offers an express option that will get your money to the destination within hours, if not minutes. However, it does mean you’ll pay higher fees. If you opt for the cheaper economy option, you’re looking at a transfer time of 2-5 business days.
PayPal
If you transfer from one PayPal account to another, the transaction is instant. For all other transactions, it generally takes 1 business day.
Winner: Tie
Between the express option Remitly offers and PayPal’s quick turnaround, it’s hard to pick a winner. Both can get your money there fast – you’ll just have to be willing to pay a higher fee and/or exchange rate.
General features
| Payment methods | Receiving options | Maximum and minimum transfers | Transfer speeds | Currencies | |
|---|---|---|---|---|---|
| Remitly | Bank transfer, debit card, credit card | Bank account, cash pick-up | Minimum: $10 Maximum: $18,000 |
3-5 days | 30+ currencies |
| PayPal | Bank transfer, debit card, credit card, PayPal Credit | PayPal transfer, bank transfer | Minimum: $15 Maximum: $60,000 |
3 - 5 days | 20+ currencies |
Remitly
To use Remitly, you sign up for a free account using your email on the website or app. Once you’ve signed up, just enter the amount of money you want to send, your recipient’s information and your payment information. Remitly will do the rest.
PayPal
To transfer money through PayPal, you’ll need to create a free PayPal account. You can then send a transfer to your recipient’s PayPal account, funding it with your PayPal balance, bank account, credit card, debit card or PayPal Credit. After your recipient receives the money, they can either keep the funds in their PayPal account or withdraw the money to their bank account.
Bottom line
Although it’s completely dependent on the transfer amount, Remitly is likely to beat PayPal on most transfers.
PayPal’s flat fees and rate approach mean that you are often paying more, particularly when it comes to the exchange rate margin. While PayPal will offer small fees on some transfer amounts, it’ll make up for it in the exchange rate margin.
Looking for more options?
Find out more about the cost to use an alternative money transfer provider using our calculator below.
The “Rate” and “Amount Received” displayed are indicative rates that have been supplied by each brand or gathered by Finder.
Exchange rates are volatile and change often. As a result, the exchange rate listed on Finder may vary to the actual exchange rate quoted for the brand. Please confirm the actual exchange rate and mention “Finder” before you commit to a brand.