PayPal vs. bank transfer guide

You can use both PayPal® and a bank transfer to send money in the US or overseas – but exactly what is the difference between PayPal vs bank transfer?

Our guide tells you everything you need to know, comparing PayPal fees vs bank transfer fees, features, and speed to help you decide which transfer method is best for you.

Sending money abroad? Use Wise to make stress-free transfers to over 80 countries – all from just one global account. Let’s dive in!

PayPal vs bank transfer: overview

You can use both PayPal and a bank transfer to send money to yourself or a recipient via online banking.

However, PayPal is considered a peer-to-peer money transfer platform, rather than a traditional banking provider. Once you’ve signed up for an account, you can send and receive funds using your PayPal email address.

You can make PayPal-to-PayPal transfers from your digital PayPal wallet, or connect your bank account or card to add and withdraw funds.¹

In comparison, you’ll typically send a bank transfer via a traditional banking network like Swift – and your money will go straight into your recipient’s bank account.

Let’s take a look at some key differences between PayPal vs bank transfers, including features, fees, and speed.

When to use PayPal vs bank transfers

PayPal may be the best choice for everyday payments to friends and family. You can send easy, fast transfers via your PayPal wallet – and you can manage, top up, or withdraw funds in your digital account.

However, bank transfers may be better for direct transfers to other bank accounts, such as paying your bills.

Your recipient won’t need to sign up for a new account to receive your payment. As long as they have a bank account, you should be good to go!

PayPal vs bank transfers: speed

Your PayPal transfer should reach your recipient within minutes, but this can depend on how and when you send your transfer.

In comparison, bank transfers can take up to 3 business days, depending on the network used by your bank. For example, international Swift payments may take 1 to 5 business days to arrive in your recipient’s account.⁵

PayPal vs. bank transfer fees

There are a few fees to consider before sending your money via PayPal or bank transfer, including exchange rate costs and transaction fees.

Let’s take a look at how much it costs to use PayPal.

Currency conversion spread is the difference between the value a provider buys and sells currencies for – and many platforms will add a markup to the standard exchange rate.

Look out for the mid-market rate. This is the fair exchange rate, with no added markups, margins, or hidden fees.

You may also need to pay for your bank transfer. Your exact fees will depend on the provider you use. Let’s take a closer look.

All of these fees can really add up, especially if you regularly send money overseas. However, these providers aren’t the only options…

A smart option if you’re sending money overseas: meet Wise.

Register a Wise account online or in the Wise app, and send money to 70+ countries, with the mid-market exchange rate and low, transparent fees*.

Wise always shows you the amount you’re paying and how much your recipient will get — and you can even compare against other providers on the Wise app or desktop site.

If another service is cheaper for your particular payment, you’ll be shown — so you can’t lose.

Get started with Wise

PayPal vs bank transfer pros and cons

Let’s take a look at the pros and cons of using PayPal international transfer vs bank transfer, including speed, fees, and security.

Advantages and disadvantages of PayPal

Advantages and disadvantages of bank transfers

PayPal vs bank transfer: what's best for international transfers?

You can send money abroad via bank transfer, but it may be quicker and easier to use a transfer platform like PayPal or Wise.

PayPal lets you make convenient digital transfers within minutes, with the option to send, receive, or withdraw funds in 25 different currencies.

You can also send an international payment with some traditional banking providers, but you’ll need to check if your account supports foreign payments. You may also face additional restrictions, depending on your bank.

Both PayPal and your bank charge for international transfers, so make sure to compare exchange rates and fees to get the most out of your money.

Is PayPal safer than a bank transfer?

Both PayPal and traditional banking providers take important security measures to protect your money from fraud.

However, PayPal may be considered more secure for online transactions, as you can pay for goods and services using just your email address.

In this way, PayPal acts as an intermediary for your transactions, keeping your bank details safe.

Conclusion: PayPal or bank transfers, what's the right one for you?

It’s important to choose the right transfer method for you. PayPal can help you move your funds immediately – and there are multiple ways to pay.

However, a bank transfer may be best if you need to make a big payment directly into someone else’s bank account, especially if your recipient doesn’t have PayPal.

To start sending your money across the globe – all at the mid-market exchange rate – check out Wise.

Sources:

1. PayPal
2. PayPal
3. PayPal
4. Western Union
5. Money Transfers
6. US News
7. Investopedia
8. Finder
9. PayPal
10. Investopedia