TransferWise vs InstaReM: The Multi-Currency Wars Continue

Disclaimers: This post is in no way sponsored.

The following comparisons are preliminary; we’ll be updating this space in coming weeks with a more in-depth analysis of the two digital remittance services. 

Returning from holiday with excess foreign currency truly is the worst.

I should know; I changed about S$150 for a day trip to Malmö, Sweden, earlier this year — only to realise the whole damn city’s practically cashless, aka lightyears ahead of Singapore. At least, in that respect.

That’s where multi-currency wallets like Revolut and YouTrip come in – because commission-free exchange rates matter, clearly.

But let’s now hone in on InstaReM and TransferWise, two relatively new digital bank players that specialise in overseas money transfers.

Note: These comparisons are We’ll be covering InstaReM in greater depth next week, in line with our Seedly x InstaReM meet-up on Oct 25. Find out how to secure tickets here!

Before we get into the thick of things, here’s a primer on both fintech companies.

What is TransferWise?

TransferWise’s primary focus is in the digital remittance space.

Unlike traditional money remittance services from banks, its fees are kept low by treating each transfer as a local one. 

So, let’s say you want to send S$100 to Australia. Your money is first converted using mid-market rates to AUD, then sent to TransferWise’s Australia bank account.

You may also need to verify your identity for larger transfers – a standard procedure to prevent fraud and money laundering.

TransferWise Benefits and To-Knows

• Regulated by the Monetary Authority of Singapore (MAS)
• Uses mid-market, real-time exchange rates. That means the rates you see in Google are exactly what you’ll get.
• A fee of 0.34% to 2.4% is charged based on the amount you transfer, and the exchange rate.
• Its borderless multi-currency account allows you to hold and convert over 40 currencies for up to 7x cheaper than banks
• No receiving fees for money transferred from over 30 countries. You’ll also get your own accounts across Australia, Great Britain, Europe, New Zealand and the US. 
• Its multi-currency, borderless debit card (for both individuals and businesses) launched in Singapore on Oct 15, 2019
• No sign-up fees, dormancy fees and annual fees
• Free overseas ATM withdrawals at machines that accept Mastercard (capped at $350 per 30-day cycle)
• Referrals: For every three invited friends that transfer at least $250 each, you’ll get $100
• Money transfer fees are as follows:

TransferWise: Cons

• You can’t receive payments in several currencies, including SGD…yet!

The TransferWise Set-Up Process

I will admit this: registering my details for my physical card easily took several minutes longer than Revolut – which is to say, up to eight minutes.

To TransferWise’s credit, I registered through its mobile website, which likely wasn’t as well-optimised as the app.

1. Fill out name, DOB, address, phone number
2. Enter six-digit verification code
3. Choose preferred currency for activation
4. Verify your identity via SingPass or document uploads (passport/IC, etc.)
5. Confirm details
6. Indicate purpose of TransferWise account, e.g. to pay for goods and services abroad
7. Await arrival of debit card

What is InstaReM?

Like TransferWise, InstaReM is a digital bank – so you’ll only be able to send money to anyone with a bank account.

We’ll be back with more details next week. Meantime, here’s what we do know.

Benefits and To-Knows

• Regulated by the Monetary Authority of Singapore (MAS)
• Like TransferWise, InstaReM uses mid-market, real-time exchange rates
• A fee of 0.25% to 1% is charged based on the location of your transfer. Money transfers initiated from Singapore will incur a 0.25% fee.
• Money transfers are made through Electronic Funds Transfers (EFTs), bank transfers and wire transfers
• No sign-up fees
• Loyalty program: As an individual user, you’ll be able to earn and transfer InstaPoints with every transaction.

InstaReM: Cons

• Minimum overseas transfer amount of S$200

The InstaReM Set-Up Process

Registration was a quick five-minute process.

1. Sign up with email or through Facebook
2. Select user type (Individual or Business) and country of residence
3. Verification via SingPass or document upload
4. Indicate your industry type and net worth
5. You’re all set!

Preliminary Thoughts: TransferWise and InstaReM

While it’s far too early for any conclusions to be drawn between the two digital remittance players, some obvious benefits to TransferWise and InstaReM include:

• The low costs of transferring money across borders for businesses, freelancers, overseas students and foreign domestic workers
• The use of mid-market rates means lower rates than what banks offer – a plus for all users.
• They aren’t tied to the SWIFT network, which slows down the process significantly given payment orders usually involve intermediary banks.
• You’re rewarded: TransferWise pays you $100 for every three friends that transfer at least $250 each. Meantime, InstaReM users enjoy InstaPoints that can be used to redeem real currency.

On that, some countries do impose GST for outward remittance transactions.

It’s also best to compare rates with both providers to ensure you’re getting the most bang for your buck!