TransferWise’s Borderless Account allows users to hold and convert funds in 40 different currencies and send and spend internationally, all at the “real” exchange rate and with exceptionally low service fees. Users can also receive major-currency payments free of charge.
Further to its excellent money transfer service, TransferWise offers the Borderless Account.
This free account allows users to hold funds in 40 different currencies, convert held currencies at very little cost and, for those in Europe, spend overseas with a prepaid Mastercard debit card.
With a Borderless Account, you can also receive payments into “local” GBP, EUR, USD, AUD, NZD, SGD, RON, CAD, HUF and TRY accounts cost-free, since no FX conversion takes place.
The Borderless Account is an excellent solution for e-commerce companies, exporters, freelancers and anybody else that regularly receives money in GBP, EUR, USD, AUD or NZD but does not have an account for one or all of these currencies. Further to saving money on continual FX conversions, businesses using multi-currency accounts avoid much of the exchange rate risk associated with overseas transactions.
This account will be loved by travellers, who get to spend overseas in the local currency at no cost (if that currency matches one of their holding currencies) using Mastercard, or spend as a foreign currency with only a very small markup.
The account helps anybody else wishing to easily acquire and hold foreign currencies for any reason, whether for future payments, diversification or even speculation.
Unfortunately, as of April 2019, users in Hong Kong, Japan, India, Brazil and the US states of Hawaii and Nevada aren’t able to open a Borderless Account. For a full list of country restrictions, consult TransferWise Help pages.
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The borderless account itself has no minimum balance requirement; however, if you plan on ordering the TransferWise debit Mastercard, you’ll need to add a minimum amount of GBP 20 or local currency equivalent to the account. This is not an ongoing minimum requirement, merely a one-off payment which TransferWise says helps to confirm your identity.
There are no account opening or monthly fees.
TransferWise is undoubtedly one of the cheapest services out there for foreign exchange.
All Borderless Account transactions (adding, converting and sending funds) are conducted at the interbank exchange rate, plus or minus a very small fee. The interbank exchange rate can be considered the real exchange rate and the ability to transact at or very near to this rate eliminates most of the cost associated with traditional foreign exchange.
For many popular currency conversions, as of March 2019, the actual fee levied by TransferWise (your total cost) per exchange will be near or less than 0.5 percent. Unusual conversions might cost 1 percent or more, but in all cases TransferWise is entirely transparent with its fees. Some examples are below.
The TransferWise debit Mastercard works like any other debit card; it can be used anywhere you see the Mastercard logo and is currently available to residents in the UK and most of the EEA.
After opening your Borderless Account, you’ll need to order the card (if you want one) and add GBP 20 or local currency equivalent to your account, which TransferWise says helps to verify your identity.
If making card payments in a currency that you already hold in your account, there will be no fees whatsoever since no FX conversion takes place.
When making card payments in a currency that you don’t hold, TransferWise will convert funds at the same interbank rate it always uses and will apply the conversion fee, typically between 0.35 and 1.0 percent of the transaction amount (see ‘Exchange Rates and Transaction Fees’).
When making card payments in a currency that is not supported by TransferWise, you’ll be charged the Mastercard rate.
ATM withdrawals are free for the first GBP 200 withdrawn (or local currency equivalent) in each 30-day billing cycle for currencies that you own. Beyond this modest allowance, a flat 2 percent fee is charged. If you don’t own the withdrawn currency, you will of course incur the conversion fee, and then the 2 percent fee beyond the aforementioned limit.
When withdrawing cash overseas, be aware that foreign banks might charge their own ATM fees, and these would apply in addition to any charge levied by TransferWise.
For businesses and freelancers, one of the biggest reasons to sign up with TransferWise will be the international account details supplied with each Borderless Account.
Regardless of which country you live in, with your Borderless Account you’ll receive a unique set of GBP, EUR, USD, AUD, NZD, SGD, RON, CAD, HUF and TRY account details with which you can get paid like a local. Together with an account number, you’ll receive a SWIFT, BSB, routing and/or sort code and anything else needed to receive funds in those currencies.
These accounts behave just like local bank accounts opened within national borders; so, for a payment in US dollars, you’d simply give your customer your USD account details, and since no FX conversion takes place, you’ll pay no fees on the money received.
No, the Borderless Account is an electronic money account, which means that you won’t earn interest on deposited funds or be offered an overdraft or other banking facilities.
Although the “local” bank details you’ll receive free of charge with your Borderless Account are completely unique and personal to you, these don’t represent real bank accounts; instead, they are electronic “addresses” through which TransferWise funnels money to its customers.
There is no additional withdrawal fee. Withdrawal of borderless funds is treated like any other money transfer (see ‘Exchange Rates and Transaction Fees’).
In many cases, a Borderless Account user will be withdrawing (sending) funds to an account in the same currency (e.g. sending AUD borderless funds back to “home” AUD bank account), and at these times TransferWise’s fee is much lower than it would be for a transfer to a foreign currency (a third of the usual fee or less).
All evidence points to your funds being safe with TransferWise.
As with any e-money account, your funds will not be guaranteed under the Financial Services Compensation Scheme (the UK government scheme that guarantees the first £85,000 held within FCA-authorised banks and credit unions); however, TransferWise is a highly regulated firm, and as such is required to keep customer funds separate from its own in a low-risk financial institution (currently Barclays). This means that in the highly unlikely event that TransferWise goes to pot, your money should be returned in full. If for any reason it could not be returned (e.g. if Barclays failed), customers would need to join other creditors in making a claim against TransferWise’s remaining assets.
As of March 2019, TransferWise was regulated by financial authorities in the US, UK, EEA, Singapore, New Zealand, Japan, Australia, Hong Kong and Canada.
At an account level, TransferWise deploys a number of measures aimed at protecting your money, including 2-step logins and Transport Layer Security encryption to protect transactions and all communications with the company.
All said, we cannot see any reason why Borderless Account funds would be at risk.
Business owners can take their Borderless Account functionality to the next level by signing up to “TransferWise for Business.”
Although advanced business features are entirely free, it is perhaps a negative of TransferWise that these mostly require API integration and, in some cases (e.g. batch payments), the functionality is hardly state of the art.
Using TransferWise’s open API, exchange-rate tracking, automatic payments and recurring transfers become possible, as does Slack integration.
Batch payments (up to 1,000 payments at the click of a button), such as those needed to pay an international payroll, require the configuration of a CSV file.
With TransferWise for Business, users can automatically sync all or part of their Borderless Account activity with Xero—the popular cloud-based accounting platform.
TransferWise offers email support and 13 national phone lines for support in your language. Phone support is available Monday to Friday and operational hours for each phone line can be found by selecting your region on TransferWise’s ‘Contact Us’ page.
BER research indicates that roughly 75 percent of TransferWise users who had cause to contact customer service were happy with their experience, which is in line with the industry average. Roughly a quarter of those with issues claim that customer service was unsupportive or that emails weren’t replied to.
TransferWise is rated very highly on popular review sites. As of April 2019, on one particular site, 87 percent of 62,000 reviewers gave TransferWise a 5-star rating; only 3 percent said they had a “bad” experience with the company.
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Disclaimer: Please note any provider recommendations, currency forecasts or any opinions of our authors should not be taken as a reference to buy or sell any financial product.