When you’re away from your home country, whether you’re an expat in Kenya or a Kenyan in the diaspora, it’s a comfort to know that there’s Transferwise in Kenya. Even freelancers like myself rejoiced when we heard the news.
Transferwise’s innovative solution to international money transfer changed the game. It brought down the costs of moving money across borders and its Borderless Account service makes international travel a breeze.
In case you don’t know about Transferwise in Kenya, let’s start at the beginning.
What is Transferwise?
Transferwise helps you move money from one country to another at fair (mid-market) exchange rates and without incurring the high costs that normal banks charge.
If you have an account with them, you can also use it while traveling instead of using your own bank account or debit/credit card and benefit from the low fees they charge.
How does Transferwise work?
Transferwise has bank accounts in many countries in the world, including Kenya. They use these accounts to receive money in one country and pay it out in the other. Let’s assume you’re sending $1,000 to the United States from Kenya.
- You first begin by calculating how much you will need in Kenya Shillings to make that $1,000. You can easily do this on the Transferwise website.
- Once you know how much you need to send, you can use either your debit or credit card, bank account or M-Pesa to deposit funds into the Transferwise account in Kenya Shillings.
- Transferwise will then tell their bank in the US to send the $1,000 to your recipient. Because money doesn’t actually leave the country, you save on the cost of international transfers.
Benefits of Transferwise
- Cheaper: Using Transferwise saves you on international transfer fees when sending money out of the country. They also convert money into other currencies using fair prices, unlike most banks.
- Transparent: All costs and conversion rates are immediately visible on the Transferwise website. What you calculate is what the person you’re sending to will receive.
- Fast: Transfers are quicker because there are fewer processes involved. Currency conversion is the longest process with Transferwise and this is only up to 2 days.
- Mobile: With a Transferwise account, you have access to your money anywhere in most places in the world at no extra cost.
- Trustworthy: Transferwise is as recognised and trusted as Western Union. Most people dealing with international transfers will not have a problem accepting Transferwise as a transaction platform.
How to Use Transferwise in Kenya
For Kenyan Citizens and Residents
- Receive money from overseas.
- Make online purchases using the Transferwise debit card.
- Make purchases at established stores that accept card payments.
- Save money in foreign currencies when exchanging to Kenya Shillings is not favourable.
For Tourists, Remote Workers, and Digital Nomads
- Free ATM withdrawals
- Free foreign currency transactions
- Pay your Rent
- Top up your M-Pesa
- Pay Kenyan freelancers and contractors
How to Receive Money Via Transferwise in Kenya
Receiving a Transferwise transfer in your bank account happens the same way as receiving a direct transfer from a local bank. Transferwise receives your bank details from the sender and makes the payment through their bank. You should receive the money within 2 working days.
Receiving money through M-Pesa is faster and more convenient for most people in Kenya. The sender only needs your full name and mobile number to make the transfer. More below.
How to Send Money From Transferwise to M-Pesa
Like most financial services available to Kenyans, Transferwise transfers can be received directly on M-Pesa. The process is easy to follow and the money is transferred instantly.
To send money from Transferwise to M-Pesa, you will need the recipient’s full name and M-Pesa phone number (starting with 254). On your Transferwise account page:
- Select “Send money” at the top.
- Use the calculator on the next page to determine how much you are sending and how much the recipient will receive. This page will also show you the fees you will be charged and the savings you will be making.
- Select the source of your transfer from a drop-down box just beneath the box in which you’ve entered the amount you want to send.
- After confirming all is in order, select “Continue” at the bottom of the page.
- On the next page, pick from the three options the type of recipient you’re sending the money to.
- A pop-up will appear. Enter the email address of your recipient, and then,
- Under Bank Details, select M-Pesa on the right tab.
- Enter the required details. Ensure you use “254” and not “+254” when entering the mobile number.
- Select “Confirm.”
- On the next page, select the source of the transfer. Make sure you read the costs included with each option. Select “Continue to payment.”
- Depending on your choice above, the next few prompts will request access or details on the source of transfer such as online banking platform, debit/credit card numbers or bank and bank account details.
- Complete the transfer.
We have a full guide to M-Pesa if you want to know more about the popular Kenyan service.
Transferwise Borderless Account
The Borderless Account is an online money account in which you can receive, send or hold money just like you do with your bank, but in over 50 international currencies. You can therefore use this account to make and receive payments from anywhere in the world at very low fees and fair conversion rates.
The account is an upgrade to the normal Transferwise account and can be linked to your Transferwise debit card and used just like any other debit card.
You can also manage the account using Transferwise’s mobile app, where you can track transfers in real-time.
However, unlike using a normal bank account, the Borderless Account has a few limitations:
- It only accepts electronic payments. No cheques, no cash.
- Because Transferwise is not a bank, you can’t earn interest on your account balance.
- There is a withdrawal fee of 2% of the amount once you exceed $250 per month.
- You cannot pay bills directly from the account.
- You cannot access loan and credit facilities.
- Personal accounts have a daily limit of $250,000 and an annual limit of $1,000,000
The Borderless Account and debit card are currently not available in Kenya. We will revise when it becomes available. However, if you are in one of the countries in which both are available, you can hold your money in Kenya Shillings.
Xoom, which is owned by PayPal, is also a service that enables you to send money across countries. The difference is that Xoom allows cash pick-ups from its partner vendors, not just bank transfers. You can even have the money delivered to your doorstep in cash.
Western Union is one of the most widely used online money transfer services in the world. It is more expensive than Transferwise but more accessible.
Remitly is a purely digital money transfer service that works similarly to both Xoom and Transferwise. They try to provide fair exchange rates but Transferwise is more transparent about their rates by simply going for the mid-market rate.
Worldremit is a good alternative to Transferwise. While Worldremit is not as transparent as Transferwise, they have equally good exchange rates on the surface and you can transfer to Airtel Money and Equitel in addition to M-Pesa.
PayPal is quicker to use than Transferwise but it is also more expensive. Find out more below or in our guide to PayPal in Kenya.
N26 is a European mobile banking service. You can manage your money directly from your phone and get a virtual Mastercard for online transactions. N26 is a more financially advanced service than Transferwise’s Borderless Account.
Revolut is an online money service available in over 30 countries. You can link different bank accounts to the platform and make all your transactions from one place. Revolut also provides single-use debit cards for more secure online payments.
Transferwise or PayPal? Which is Better?
Transferwise is a better overall service than PayPal. PayPal may be the more widely used service globally but Transferwise is cheaper and practical than PayPal in lot of ways Here’s how:
- Transferwise charges less than PayPal and uses a better exchange rate.
- Transferwise allows you to pay directly into someone’s account even if they are not registered with the company.
- The Transferwise debit card, which is on Mastercard’s network, is more widely accepted as a means of payment online and in physical outlets.
However, it’s easier and faster to transfer money from PayPal because you only need an email address to do it. And in Kenya, there is a direct link with M-Pesa to both deposit to and withdraw from Paypal.
Transferwise’s simple but innovative solution to international money transfer has basically erased borders. There’s no longer a pinch when you think about sending money to your stranded friend somewhere in the world. Or better yet, if you have the Borderless Account, you can just go and join them on a whim.
With costs almost similar to local bank transfer charges, it’s a wonder how we ever survived without Trasferwise in Kenya.
Frequently Asked Questions About Transferwise in Kenya
Yes, you can send and receive money using Transferwise in Kenya.
Transferwise has bank accounts in various countries. When money is transferred into one account in one country, the transaction is simply communicated to the bank in the country where the money is going and the money is transferred out of the account held in the second country.