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Feb 22, 2014 | Comparing OANDA, XE and TransferWise

Living in Switzerland means occasionally I want to send money to the United States, and short of flying to the US, there are basically three ways I can do that online. I haven’t had until now the time to be a bit rigorous in my experimentation, but these are the real results I’ve obtained. For the purposes of this experiment, let’s imagine that you want to transfer as little Swiss francs as possible to get 1000 USD, incurring the fewest fees along the way. Since I use PostFinance, international wire fees cost 2 CHF, domestic are free.

As of right now, as the markets are closed, I should have to only put in 887 CHF to get 1000 USD.



Recipient bank: RBS, UK
CHF necessary to get 1000: 887.20
Fees: Outgoing bank’s international fee (2 CHF) + receiving bank wire fee ($16)
Rate conversion: at the time of the transfer
OANDA requires you to transfer money out the way you receive it, which means it becomes an international wire for which Bank of America charges a $16 fee. Also, frustratingly there’s a flat $20 fee to initiate the deposit. However, when you do have money in the account, the transfer is at the market rate. The only downside is that you need a Ph.D to navigate the website (I actually had to email OANDA to find out how).



Bank of America charged me an incoming wire fee


Recipient bank: Bank of America, UK
CHF necessary to get 1000: 922.30
Fees: Outgoing bank’s international fee (2 CHF)
Rate conversion: at the time of the order, not the transfer
XE can deliver the amount using an ACH transfer, which means the receiving bank doesn’t charge me any fees, which is nice. But the profit margins that XE includes in the transfer means I’m effectively losing $35 with the transfer (and more so for larger amounts – $135 relative to the market rate when transferring for $4000). However, you lock in that rate conversion, instead of waiting for the market to change while your orders are being placed.



Recipient bank: Bank of America, Switzerland
CHF necessary to get 1000: 893.05
Fees: Receiving bank wire fee ($16) + TransferWise fee (0.5%, 4.94 CHF)
Rate conversion: at the time of the transfer
The website may look clean and elegant and the customer service excellent, but TransferWise charges 0.5% of the total transaction, which means effectively any transfer over 4000 CHF will make TransferWise subpar relative to OANDA. You get the ability to control what amount of fluctuation from the current rate you’re willing to accept, up to 2%. There’s no ability to store money in your account.




Between XE and TransferWise, the latter is better when dealing with smaller amounts of money (< $4000). Any transfer of money above that amount will be much more profitable using OANDA, especially if you fund your account ahead of time and wait for the good rates.

This entry was posted on Saturday, February 22nd, 2014 at 6:22 am, EST under the category of Articles. You can leave a response, or trackback from your own site.