Wise (formerly TransferWise) vs PayPal in New Zealand: Which is better?

Looking for simple ways to send, spend or receive foreign currencies from New Zealand? Perhaps you’ve heard of both Wise and PayPal¹.

Both offer simple ways to send and receive foreign currencies, and spend online. Both also have options for business customers in New Zealand. However, the features and fees of PayPal vs Wise are pretty different. This guide walks through all you need to know about both providers, so you can decide which works best for you.

What is PayPal?

PayPal is one of the original digital payments platforms, offered in pretty much every country around the world for online shopping and international transfers from one PayPal account to another. PayPal is also available for business owners who can offer PayPal payments for secure online shopping in multiple currencies.

In New Zealand, individual customers can use PayPal to spend online and in apps, and to send or receive payments. Business customers can accept and make payments and get operational support for their business to manage risk or streamline operations.

Complete Guide to Using PayPal in NZ 👉

What is Wise (formerly TransferWise)

Wise was originally called Wise and offers individual and business customers digital accounts and debit cards with no ongoing costs and low service fees.

Wise accounts can hold and exchange 40+ currencies, send international payments to 160+ countries, and spend with an international Wise debit card in 150+ countries. Accounts also have local details which allow you to get paid by others cheaply or for free, in 9 currencies. Wise Business customers get all the perks available for individual users, as well as some business friendly extras like batch payments and multi-user access.

Wise has over 17 million customers globally and is overseen by regulatory bodies all around the world.

Wise vs PayPal: Main Comparison

When choosing a provider for international payments and spending it’s important to pick carefully to minimise costs and make sure you have all the features you need. We’ll get into the detail of Wise vs PayPal fees later - but first, let’s take a features overview to give a flavour of what you can expect from PayPal vs Wise as a personal or business customer:

Wise Vs PayPal: International Transfers and Exchange Rate

We’ll look in more detail at the fees for international payments with Wise vs PayPal in just a moment - but first let’s look at how each provider works for international transfers, including the exchange rates used.

Wise lets you send money to bank accounts in 160+ countries, using the mid-market exchange rate and low fees from 0.39%². You’ll set up your payment online or in the Wise app, and can see all the costs split out easily before you confirm. Depending on where you’re sending money to, your payment could be instantly available in the recipient’s bank account and ready for use³.

PayPal works a bit differently for overseas transfers. When you send money with PayPal it’s deposited into your recipient’s PayPal account. Transfers can be made more or less globally - but you’ll need to make sure your recipient has a PayPal account before you get started.

PayPal transfers have a flat fee, and a percentage markup on currency conversion. If you pay by card there’s an extra charge to pay too³. Money arrives instantly in the recipient’s account in many cases, but if your recipient wants to withdraw their funds to their bank account this may take a few days, depending on their location.

Wise vs PayPal: for managing multiple currencies

If you’re looking for an account to manage multiple currencies all in one place, you’ll want to learn more about the features of the Wise multi-currency Account and the PayPal Wallet. Here’s a summary:

Wise vs PayPal: Receiving Money in NZ

What about Wise vs PayPal for receiving money? Again here PayPal and Wise work a little differently.

With Wise you can receive money in New Zealand either to your Wise account, or to your main bank account. If someone is sending you a payment you’ll simply need to give them your preferred account details from your normal bank, or look in the Wise app to get your Wise NZD account details. In either case, there’s no fee to receive a payment in NZD with Wise.

With PayPal you can receive money only to your PayPal account. There’s no fee to receive a PayPal payment as long as there’s no currency conversion involved. Bear in mind your sender may pay a fee if currency conversion is needed - or else you might have to pay the costs of conversion when you spend or withdraw a foreign currency payment.

Wise vs PayPal: Sending money from NZ

We looked a little earlier at how Wise vs PayPal work for international transfers and currency exchange. Let’s get a more detailed overview of a head to head comparison, below the table is a comparison calculator which lets you model your payment:

Wise vs PayPal: Making Card Payments and shopping online

In some countries, PayPal issues debit and credit cards which are linked to an online account. This option is not available for PayPal NZ customers, but you can still use PayPal for online or in-app spending if you link another card to your account.

Wise offers a debit card which is linked to the multi-currency Wise account, and which can be used for online and in person payments, as well as cash withdrawals in 150+ countries. Here’s a quick overview:

While PayPal does not offer a debit card for New Zealand residents, it does spend online or in app with your existing bank card linked to your PayPal account

Wise vs PayPal: for Businesses and Freelancers

Both Wise and PayPal can be used by business owners and freelancers in New Zealand. Here are some of the account features you can expect with each:

Using Wise with a PayPal Account

You can pair your Wise Business account with PayPal to get the benefits of PayPal's payment gateway for international payment processing, as well as low cost currency conversion. Simply open a Wise Business account and use your local account details with PayPal to payout in a selection of currencies to Wise.

Once you have a foreign currency balance in Wise you can exchange or withdraw using the mid-market rate and low fees from 0.39%. Or, hold your foreign currency balance until the next time you need to make an international payment and take advantage of Wise’s speedy international transfers to pay contractors and suppliers in 160+ countries.

Summary: should you choose PayPal or Wise in NZ?

Whether Wise or PayPal is best for you depends on what you need in an account:

Take a look at Wise or Wise Business if your focus is on a very flexible international account with an excellent range of supported currencies and linked debit cards for overseas spending and withdrawals. Wise uses the mid-market exchange rate and has low overall costs, for personal or business use.

If you're a merchant looking for payment gateway services or ways to embed payment options to your website, PayPal may be a better bet as these options aren’t available with Wise. Consider linking your PayPal merchant account to Wise Business to get the best of both worlds.