Transferwise - painless and cheap FX and overseas purchases

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Forums › Bargains and Deals › Transferwise - painless and cheap FX and overseas purchases

landcruiserguy

761 posts

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#265400 20-Jan-2020 10:54

I have been using this quite a bit and it's saved me heaps of money on overseas purchases.

Transferwise gives you a real debit card (Mastercard) and virtual bank accounts in overseas currencies. If you want to buy things in USD then you put money into your NZD transferwise account and then buy stuff with the mastercard. Letting transferwise do the FX conversion rather than the bank or paypal saves about %4 which adds up fairly quickly.

If you receive overseas funds then you can put it directly into your foreign currency bank account. You can then transfer it back at the cheap 1% transferwise rate and take it out or just use it for your USD purchases.

This invite code gets you a free transfer and if enough people use it, me some free money.

https://transferwise.com/invite/u/guyb94

No fees to sign up and order the master card but they do require you to either deposit some money or supply ID to open the overseas bank accounts. Presumably this is to prove that you are not the Iranian Minister for Oil Revenues.

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#2402186 20-Jan-2020 11:09

I used this during the holidays as well and it's pretty cool. I loaded three virtual CCY accounts and depending on the country I was in, it deducted the money from the correct account - Eg - SGD in Singapore.

Not only I got a better rate than the banks when I transferred lump sum into these accounts, I even saved on FX conversion fees had I used my standard NZ credit card.

The other cool feature was transferring from one virtual account to another - eg Once I got back to NZ, I transferred remaining SGD to NZD account and use it locally.

Simply brilliant!

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1024kb

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#2402203 20-Jan-2020 11:30

Official AUD rate is .96 now. Transferwise do it at .957 whereas the industry giant, PayPal, generously offer .927.

I often do foreign purchases online, the fees & harsh exchange rates can easily take the gloss off the deal, so I'm pleased to read this post.

Thank you @landcruiserguy, I've signed up already.

Megabyte - so geek it megahertz

landcruiserguy

761 posts

Ultimate Geek

#2402207 20-Jan-2020 11:57

Glad you guys like it as I am loving it. Every time I buy something off Amazon I feel happy because I save $5 on the FX fee.

One challenge is that if you add the master card to paypal as a NZD card then you need to change the FX conversion option each time you purchase. This doesn't appear to be changeable on the mobile verison of the paypal check out web site. I think if I had my time again I would add it as a USD card.

I am in my company share scheme which of course pays me in USD and then charges me a 2.5% FX fee. With transferwise I can just put that in my USD account and either transfer it back for 1% or just leave it in USD and spend it on things online.

Another use case is giving money to relatives overseas. I had to pay my bro in Oz a couple of hundred dollars. Instead of paying the 5% paypal fee I transfered it to my AUD transferwise account (for 1%) and then did a bank transfer from my transferwise AUD account into his real Australian bank account.

My final tip is that given that this is all about avoiding fees than it doesn't make that much sense to add money to your NZD transferwise account with your credit card or POIL as they all have transaction fees. Doing a bank deposit into transferwise is free but not instant so what I do is just keep a $100 NZD float in the account. Any time I spend it I top it back up. That way if I am inspired to buy something off amazon in the weekend then the money is already there.

dunnersdude

160 posts

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#2402320 20-Jan-2020 13:19

Keen to know some more details about how this works/usage cases

floydbloke

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#2402362 20-Jan-2020 13:46

There is a good discussion on this topic in the Travel forum .

After I was born, I didn't talk to my parents for two years.

sbiddle

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#2402386 20-Jan-2020 14:20

Call me confused but I'm totally lost on the whole point of acquiring a new card for overseas purchases.

I use my ANZ Visa for thousands and thousands of dollars of overseas purchases and travel each year. I pay 1.8% in fees from ANZ on my card and get 1.3% back in Airpoints Dollars giving an effective conversion rate of 0.5%

Transferwise offer 0.49% as their conversion fee.

I'm not going shopping around and interested in transferring money just to save 0.1%, especially when ANZ's fraud analytics and processes once fraud occurs is so good.

As for ATM withdrawals ANZ don't charge for them but I do pay a conversion fee of 1.8% every transaction. Considering Transferwise only get you get the first NZ$300 per month out for free and then charge you 2% for every $ after that there may be zero advantages based on how much case you get from an ATM.

If you are transferring currency to a bank account in another country Transferwise is a good option. For everything else I'm just confused as to why people think it's so great.

mentor

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#2402445 20-Jan-2020 15:45

Although you raise a very good point re airpoint, there are a few scenarios I think this will be handy:

Pre planning your holiday by loading currency when the exchange rate is favourable. Eg I setup rate alerts on transferwise, if it reaches a certian threshold I get notified and I can choose to add some funds here.
Having a holiday spend card so you come back home debt free.
Having a local card to signup services - Eg. Grab in singapore etc.

Shindig

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#2402470 20-Jan-2020 16:01

mentor:

Although you raise a very good point re airpoint, there are a few scenarios I think this will be handy:

Pre planning your holiday by loading currency when the exchange rate is favourable. Eg I setup rate alerts on transferwise, if it reaches a certian threshold I get notified and I can choose to add some funds here.
Having a holiday spend card so you come back home debt free.
Having a local card to signup services - Eg. Grab in singapore etc.

Wheres the option to config rate alerts?

The little things make the biggest difference.

sbiddle

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#2402482 20-Jan-2020 16:22

Forex rates go up and down continually. Yes you may gain going on holiday but you also have a 50% chance of losing on the deal.

Others may see a point in the card, but as a frequent traveller I just don't see any.

traderstu

296 posts

Ultimate Geek

#2402539 20-Jan-2020 16:38

sbiddle: Others may see a point in the card, but as a frequent traveller I just don't see any.

There's your answer - not everybody is a frequent flyer.

richms

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#2402546 20-Jan-2020 16:53

If you want to do currency speculation then this is not really a good way to go about it.

The card doesnt pass the tests of being a US card or a UK card for services that limit by that, so its pretty much no more use than my asb card online. If I could have it fly thru the checks that they have that you are paying from a card in the zip code that you want things shipped to then it would be useful, but it gets even less far thru checkout than my asb card does before being declined.

Richard rich.ms

tieke

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#2402549 20-Jan-2020 17:04

richms:

The card doesnt pass the tests of being a US card or a UK card for services that limit by that.

I haven't tried it for lots of things but it was my only card that was accepted by US hulu, so can be used for at least some services.

mentor

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#2402558 20-Jan-2020 17:17

Shindig:
Wheres the option to config rate alerts?

https://transferwise.com/tools/exchange-rate-alerts/

KiwiSurfer

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#2402561 20-Jan-2020 17:23

mentor:

Having a local card to signup services - Eg. Grab in singapore etc.

I have a TransferWise card and it shows up in various online services as a NZ issued card. It seems they have a different BIN (i.e. first 6 digits of the card number) for each country they issue cards in. So doesn't really help in those cases. I can't recall using Grab in Singapore, but FWIW my Kiwibank card worked everywhere in Singapore including even the metro.

I used it overseas recently and while I found it worked well as a EFTPOS substitute, it's only good for cash up to $300. I keep having cash withdrawals declined before I worked out I needed to have enough cash in the account for the withdrawal plus the withdrawal fee. That was a fustrating experience as the app kept showing a failed withdrawal for the exact amount of money that was in my currency account. Not really good UX.

My next trip will be my Kiwibank card and a bit of cash in countries with good Visa coverage and just cash in countries where Visa is not as common.

landcruiserguy

761 posts

Ultimate Geek

#2402630 20-Jan-2020 18:13

sbiddle:

Call me confused but I'm totally lost on the whole point of acquiring a new card for overseas purchases.

I use my ANZ Visa for thousands and thousands of dollars of overseas purchases and travel each year. I pay 1.8% in fees from ANZ on my card and get 1.3% back in Airpoints Dollars giving an effective conversion rate of 0.5%

Transferwise offer 0.49% as their conversion fee.

I'm not going shopping around and interested in transferring money just to save 0.1%, especially when ANZ's fraud analytics and processes once fraud occurs is so good.

As for ATM withdrawals ANZ don't charge for them but I do pay a conversion fee of 1.8% every transaction. Considering Transferwise only get you get the first NZ$300 per month out for free and then charge you 2% for every $ after that there may be zero advantages based on how much case you get from an ATM.

If you are transferring currency to a bank account in another country Transferwise is a good option. For everything else I'm just confused as to why people think it's so great.

What kind of card give you that low conversation rate? I am an ANZ customer so keen to know more.

Personally, I have tried doing multiple transactions with letting Amazon, ANZ and Paypal do the FX and reverse engineering the rate from the final amounts. It's all about the same. Using transferwise I save 4%.

I think you overrate the ANZ fraud analytics. I was in Oz on holiday at the same time as someone in Paris was using my CC number to buy croissants and coffee. The ANZ\Visa geniuses didn't pick that up.

I am also an ANZ customer and when using a ANZ ATM in Oz I got charged a overseas ATM fee so not sure why you don't get that. ANZ charge you 1.8% (plus the overseas ATM fee), transferwise charge you 2%. It's basically the same. Nobody really needs cash while on holiday any more so the answer is to just use the transferwise card for your holiday purchases.

So I think the reason why everyone thinks it's great is that we are all paying more fees than you. Let us know what kind of credit card you have with the low conversion rate.

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