Whether you own a business or you just regularly send money internationally to family and friends, looking at a faster option to get your money sent to the supposed receiver is the most practical thing for you to do. Getting that confirmation that the money has already been received can let you breathe a sigh of relief. Nowadays, with the presence of the internet, many companies offer international money transfer services.
Two of the biggest names when it comes to international money remittance are OFX and TransferWise. Both are known for their affordable, secure, and fast service in providing money transfer overseas. Both of them deliver a high quality of service in different countries worldwide. The question now is: which one is better?
Before you start with the comparison between OFX vs TransferWise, here’s a brief history of the two global companies:
TransferWise was founded by friends Kristo Käärmann and Taavet Hinrikus. It has been growing rapidly since it started in 2011, and operates uniquely by swapping currencies instead of exchanging them. For example, if someone in Australia wants to send money to Canada, and someone in Canada wants to send money to Australia, the currencies are swapped once they are entered in the TransferWise system. Thus, money doesn’t technically leave the country.
Meanwhile, OFX was previously known as OzForex when Matthew Gilmour founded it in 1998. OzForex operated with an array of specific brands, namely Canadian Forex, USForex, UKForex, NZForex, ClearFX, and Transferz. In 2015, the brands were consolidated into one global name, which is now known as OFX.
These are the aspects you can look into to begin your comparison:
Many people think that the convenience of being able to do things efficiently online may come at a risk, especially when it involves money. Some may be reluctant in putting their bank details out there for fear of theft and fraud. TransferWise and OFX treat security issues with utmost importance. Both companies claim to have been able to maintain bank-level security and commit to doing so continually.
TransferWise is regulated by Authorité des Marchés Financier, Financial Conduct Authority, Customs and Excise Department (CCE) of Hong Kong, and the Australian Securities and Investments Commission.
In addition to TransferWise’s regulatory adherence, they have adopted digital security such as two-step logins and verifications to make sure that only the rightful owners have access to their accounts since the service offers business accessibility online.
The Australian Securities and Investments Commission regulate OFX, Financial Transactions and Reports Analysis Centre of Canada, and Financial Conduct Authority. OFX has also claimed that they’re doing proactive testing on their sites to make sure that there will be no untoward exposure of customers’ data.
2. Fee and Exchange Rate
The cost when you are sending money is influenced by two factors: a transfer fee and the exchange rate. This means that the money you will have to spend depends on the currency pairing and how much you are sending.
With TransferWise, there is no fixed amount for their transfer fee. It will be a percentage based on how much money you are sending. Typically, the fees are relatively low depending on your currency pairing, leaving some international transactions costing more than the other. The average percentage they charge for a money transfer is 0.5%. For countries using SWIFT International money payments such as Canada, the fee can bump up a little more. In addition to their small fee for every transfer you make, they also give you a mid-market exchange rate.
Also known as the interbank rate, the mid-market rate is the average of a currency pair’s buy rate and sell rate.
OFX, on the other hand, is straightforward. Their standard fee and applicable fee-free threshold vary from where you reside. An example is that you pay a $5 transfer fee if you send less than $5,000, but it is free of charge if you send no lesser than $5,000.
Below is the fee structure with their equivalent threshold:
Currency Fee Fee-Free Threshold
AED 50 30,000
AUD 15 10,000
CAD 15 10,000
CHF 15 10,000
DKK 20 50,000
EUR 10 5,000
FJD 20 15,000
GBP 7 3,000
HKD 60 50,000
JPY 1,500 1,000,000
NOK 20 50,000
NZD 12 10,000
PLN 15 10,000
SEK 20 50,000
SGD 15 10,000
USD 5 5,000
ZAR 50 50,000
This service can be ideal for big businesses or big transactions involving a significant amount of money. This is subject to change, so it is best to visit their website for an up-to-date version.
Unlike TransferWise, OFX does not offer a mid-market rate. But when you become their regular money transfer customer, you can make a call to negotiate your rate with them.
Ultimately, you can save a lot of money when you use either of the two compared to banks. But if every cent matters to you, start looking closely at their current rates and fees, and compare them. Not only that, factor in the average amount you’re sending. If you’re sending big payouts to business partners abroad or a sum of wages to your manager in a different country, then OFX’s structure may suit you well.
If you’re just sending money to a virtual assistant or an allowance to your child who’s in a vacation, then TransferWise may be the better option. It is also noteworthy that the money you will be paying will depend on which country you are.
Speed of Service
Remember those days when it would take a couple of weeks for the money to be transferred from one country to another? This isn’t the case anymore with the help of online remittances such as TransferWise and OFX.
Their transfer speed may not be as fast as the speed of light, but it can be a lot quicker compared to the bank. With banks, it would often take approximately two weeks to send your money overseas. But with TransferWise and OFX, it would only take 1-2 days to get it done. Sometimes, a transfer can even be completed on the same day you sent it. But keep in my mind that the processing period may also vary depending on the banking system of the receiving end. For instance, the 1-2 days may be stretched into 4-5 days when the banking systems already come into play, like in Australia or the UK. On top of that, bank holidays in the receiving country can also impact the overall transfer service.
In a not-so-perfect world, there will come a time when your transfer doesn’t arrive on your expected day. Money matters are of utmost importance to everyone, whether it’s personal or business. As someone who just sent your hard-earned money, you would want to be assured that everything is under control. Hence, excellent customer service is put in place by both companies to help you with such pressing matters.
TransferWise can be reached via different channels such as email, phone, and through their website. They have offices around the world situated in the UK, Spain, Singapore, Germany, Hungary, the US, Japan, Canada, Austria, Spain, Brazil, France, and Australia. Even their social media platforms are active and ready to take in your concerns. Keep in mind that offices in Singapore, Japan, and Hungary may only be able to offer a callback and not incoming calls.
OFX, being an already established company for some time, has account managers ready to take in your calls. They also have physical offices located in Singapore, Australia, Hong Kong, USA, New Zealand, the UK, and Canada.
Both TransferWise and OFX have user-friendly iOS and Android apps you can use anytime and anywhere in the world. This means that these two give you the flexibility to send and receive money.
- OFX provides a regular payment service to its consumers, a feature TransferWise has not offered yet.
- TransferWise and OFX both let you lock in a rate even before you can upload your money.
- Both services have an intuitive approach in their wizard-driven steps. This will walk you through the transferring process with ease.
- TransferWise and OFX also offer coupons and vouchers.
- They both support all major countries and are still adding more to their list.
Looking at their customer service, speed of transfer, and security level, it is safe to say that both are providing excellent services. The deal breaker here will depend on the consumers’ transaction need, whether you are sending a lump sum amount or you’re transferring just a small amount. Location is also a significant factor. You can then break down which of the two can give you better savings in terms of service fees and the exchange rate. You may also read reviews from current users to provide you with a better idea about which of these two services suits you best. Either way, both remittance services give you the convenience and ease nonetheless.