PayPal vs Wise
This is the widest cost gap on the site between two products people genuinely treat as alternatives. One is a conversion margin buried in the exchange rate; the other is a fee printed before you confirm.
For sending money abroad, Wise, and it is not close: PayPal takes a 4.00% conversion margin, so A$1,000 to a US account costs about A$40 against A$2.81 at Wise. Both hold an Australian financial services licence, so this is a pricing decision rather than a safety one. Keep PayPal for what it is actually good at — buying from a stranger with buyer protection, or being paid by someone who will only send PayPal. Do not use it as a way to move your own money between currencies.
Side by side
Costs are computed from each provider's published schedule for a bank-funded, bank-delivered transfer. A row marked estimated sits outside what the provider publishes as a rate.
1 Outside the measured range; using the A$1,000 measurement.
Which one, and when
Sending money to family or a friend overseas
PayPal charges the same 4.00% conversion margin whether the money is going to a merchant or to your sister, because sending money to someone who receives a different currency sits in its higher rate band. On A$1,000 that is A$40 you did not have to spend. Wise publishes its cut as a fee rather than folding it into the rate, which is also why you can check this arithmetic yourself before confirming.
The other side will only accept PayPal
Freelance clients, marketplaces and small overseas sellers often support nothing else. A 4.00% margin on a transaction that would not otherwise happen is a cost of doing business, not a mistake. What is a mistake is using PayPal by habit when the recipient would happily give you their bank details.
Buying something from a seller you do not trust
This is the one place PayPal wins on merit. Its buyer protection gives you a dispute process that a bank transfer does not, and Wise offers nothing comparable because it is not built to. If the goods never arrive, the margin you paid starts to look like insurance. Treat it as such rather than as a payment method.
You move money abroad regularly
The gap compounds. At A$500 the difference is about A$18; at A$1,000 it is about A$37. Someone paying an overseas invoice monthly is giving away several hundred dollars a year for a convenience they could replicate by saving the recipient once. It is not the dearest rate we found — Skrill and Neteller cost more once withdrawal is counted — but it is the one most Australians are paying without noticing, because PayPal is already open in the tab.
Where each one loses
PayPal takes its cut inside the exchange rate rather than as a stated fee, which makes it the hardest of the two to check at the moment of paying. Its Australian page also mixes jurisdictions — the withdrawal table it shows describes a U.S. account — so its non-conversion fees could not be verified here at all, and the 4.00% above is the conversion margin alone rather than a full total.
Wise has no buyer protection and no dispute process: send to the wrong account and the money is gone in a way PayPal would sometimes reverse. It is not on the AUSTRAC remittance register, and it is not covered by the Financial Claims Scheme, so a balance held there is not a deposit in the sense a bank account is.
General information about payment methods available in Australia. Not financial advice. Fees, limits and features change — verify current terms with the provider before acting.