PayPal and bank transfers can get your money where it needs to go. By comparing fees, rates and speeds, we look at which is quicker and can save you money.
Both PayPal and your major US bank can send your money next door or around the world online.
PayPal
To transfer money through PayPal, you’ll need to create a free PayPal account. You then send a transfer to your recipient’s PayPal account, funding it with your PayPal balance, bank account, credit or 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.
Bank wire transfers are a quick, efficient way to move your money from one bank account holder to another through existing banking networks. While in the past you had to visit a bank branch to initiate a money transfer, these days most banks allow you to initiate transfers online and by phone as well. However, delivery options are typically limited to bank account deposits, usually within a few days.
How much it costs depends on how much money you send, where you send it and how you pay for the transfer.
When you pay for an international transfer using your PayPal balance or linked bank account, you’ll pay a fee between $0.99 to $4.99 — the fee is waived if you’re sending to the US.
When you pay with a credit or debit card or PayPal Credit, PayPal charges a fee of 2.9% of the transaction amount, a fixed fee based on currency and a fee ranging from $0.99 to $4.99 depending on how much is sent.
Bank transfers
While most major US banks offer free bank-to-bank domestic transfers (or waive fees for specific account levels), they’re typically your most expensive option when sending money internationally.
Banks charge higher fees — anywhere from $25 to $85 or more, depending on the details of your transfer — and a bigger variety of fees: incoming, outgoing and other fees. On top of high fees, they offer weaker exchange rates than money transfer specialists. They also offer fewer options for your recipient, typically requiring they have a bank account in which to receive your cash.
Winner: Paypal
While bank transfer fees vary, for most transfer amounts it’s unlikely they’ll be lower than the competitive prices offered by PayPal.
Our table lets you compare the services you can use to send money abroad. Compare services on transfer speeds and fees, then click Go to site when you're ready to send.
The exchange rates for both PayPal and bank transfers depend on the mid-market rate on the particular day. Here’s what we know about PayPal and bank transfer exchange rates.
PayPal
To calculate the exchange rate it offers to customers, PayPal takes the mid-market rate it gets from its bank and adds a 2.5% margin. PayPal updates this rate twice a day.
For example, for a transfer in euros (EUR):
If the mid-market rate is 1 USD = 0.96 EUR
PayPal’s exchange rate might be 1 USD = 0.94 EUR
Bank transfers
Nearly all banks skew the mid-market exchange rate for a profit, but you’ll typically pay higher margins than you’ll find with PayPal.
Using the example of a transfer to euros (EUR):
If the mid-market rate is 1 USD = 0.96 EUR
Your bank’s exchange rate might be 1 USD = 0.86 EUR
Winner: PayPal
Here again, PayPal’s exchange rates are typically more competitive than those offered by your local bank.
Mika wants to help out her sister in Berlin; she has had a new baby girl. While Mika’s comfortable with the idea of running down to her local bank branch, she also has a PayPal account and thought she’d explore whether it’s an option.
Here’s what Mika would pay for a bank transfer with PayPal and her local bank.
PayPal
Major US bank
Exchange rate
1 USD = 0.94 EUR
1 USD = 0.86 EUR
Transfer fee
$4.99
$40
Transfer speed
1–2 business days
2 business days
Transfer options
Bank transfer
Bank transfer
Total euros received
935 EUR
860 EUR
Visiting her local bank, Mika learns that her bank offers a weaker exchange rate and a stiffer transaction fee than PayPal does. Not only will Mika save $20 on the transfer fee by going with PayPal, but her sister will also receive 75 more euros to spend on Mika’s new niece — and possibly a day sooner.
Who’s faster?
PayPal
Money transfers with PayPal are speedy. If you’re transferring between PayPal accounts, funds are available immediately. If you withdraw money from your PayPal account into a bank account, you can expect the funds to get there within the next business day.
Bank transfers
Most banks offer international money transfers that will arrive within two business days, but your transfer speed will depend on your specific bank and type of account.
Winner: PayPal
Even though both PayPal and bank transfers can get your money where it needs to go pretty quickly, PayPal edges out the competition with instant transfer options between PayPal accounts
Bank transfer, credit or debit card, PayPal Credit
Varies by country (about $0.02); $10,000 per transaction
PayPal transfer, bank transfer
From minutes to next business day
190+ countries
Bank transfer
Online, in person, app (when available)
Varies by bank
Bank transfer
Typically within two business days
190+ countries
Bottom line
Although much of the comparison between PayPal and bank transfers can vary depending on your bank account, PayPal tends to come out on top thanks to lower transfer fees, stronger rates and faster service.
Ultimately, you’ll want to compare your options to find the service that best fits your individual needs.
Frequently asked questions
Yes, most banks that offer international money transfer services will also offer domestic options.
Visit its site and click “Sign Up” at the top of the page. PayPal will guide you through the quick and easy sign-up process.
When processed through a reputable bank or company, your funds are safely tracked until in the hands of your recipient. And if you’re sending money internationally, federal protections are in place that require banks, credit unions and money transfer companies to, for example, disclose all fees up-front and give you 30 minutes to cancel a transfer, assuming it hasn’t yet been picked up or deposited.
Whether products shown are available to you is subject to individual provider sole approval and discretion in accordance with the eligibility criteria and T&Cs on the provider website.
Gabrielle Pastorek is an SEO strategist and publisher at Finder, specializing in banking. She's written more than 800 articles on the site and is a quoted expert in Best Company, HuffPost, Reader's Digest, MSN and MarketWatch. She's secured interviews with key stakeholders in the consumer insights industry, including a senior director at the National Retail Federation. Gabrielle has edited several creative manuscripts and holds an MFA from the University of Pittsburgh and BAs in English and French from Ohio University.
How do you know if your international money transfer made it safely? Learn how to track or cancel, and find out what your rights are when it comes to sending money.
From bank transfers to specialist money transfer companies, there are several options available when you need to transfer money overseas from your bank account.
If you need to transfer money overseas using your credit card, you can do so via your bank, MoneyGram, Western Union and PayPal. This can be useful in emergency situations, but credit card transfers are usually not a cost-effective option.
If you’re looking for a secure way to send money overseas, an international bank draft could be for you — but if speed is important, consider using a money transfer service instead.
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PayPal
US banks
