How to Receive Money From Abroad For Free Using Wise
Save money on international transfers by avoiding traditional bank fees
I love new financial technologies (FinTech) like online banking services because they allow us to save time & money, while avoiding all the hassle that comes with the traditional banking system.
In this article, I want to show you how to use Wise to receive money from abroad for free. I'll first show you why you shouldn't use your bank to receive foreign currencies, and then how to use Wise to easily receive foreign currencies.
Key Points
Save on Banking Fees
Traditional banks charge fixed fees (€10-50) plus hidden conversion rate markups when receiving foreign currencies
Free International Transfers
Get local bank account details in multiple currencies to receive money for free, like a domestic transfer
Real Exchange Rates
Wise uses actual market exchange rates with minimal fees, saving you up to 66 Euros per $1,000 transaction
⚠️ What NOT to Do
Don't rely on multi-currency accounts at traditional banks - they still charge hidden conversion fees
Avoid receiving foreign currency directly to your traditional bank account - you'll lose money on two types of fees
Don't assume all conversion rates are the same - banks often use unfavorable rates to make profit
Step-by-Step Guide
Why You Should Avoid Your Bank to Receive Money From Abroad
When I started my journey as an online entrepreneur (I was doing freelancing), I often got paid by clients abroad (mainly in the US), so I was receiving US Dollars on my bank account in Euros. I really had no clue at the time that I was loosing so much money in banking fees. Usually, your bank will charge you two times when receiving money in a foreign currency.
The first fee is usually directly given by the bank, which is a fee that is simply for the fact of receiving money in a foreign currency. It's usually between 10 and 50 Euros.
Then, you have the conversion rate. I was very surprised to learn that my bank actually always gave their clients a very bad conversion rate, and that they were making money with the difference compared to the actual conversion rate. This second hidden fee is usually much bigger than the first one.
Note that multi-currency accounts don't really solve the issue: you still have to convert the money to your base currency, which doesn't solve the problem as you will get the second 'hidden' fee.
Let's have a look at a concrete example. I am using Euros as my primary currency, and let's say I have a US based client paying me $1,000 for a product or for a service I did for them. Using my traditional bank, where I have an account in Euros, it would cost me from the start a fixed fee of 20 Euros just to receive money in a foreign currency. But that's not all. If I received the payment today, they would also use an exchange rate of $1.24 per Euro, so I would get at the end 786.45 Euros. Let's keep this number in mind for the next section.
- • Banks charge two types of fees: fixed receiving fees (€10-50) and hidden conversion rate markups
- • Multi-currency accounts don't solve the conversion fee problem
- • On a $1,000 transfer, you could receive only €786.45 through traditional banks
Create Your Free Wise Account
If that's not done yet, you will have to create a free account at Wise (shouldn't take more than 5 minutes). Inside your account, you will find something that is called Balances, where you can store money in many currencies:
- • Account creation takes less than 5 minutes
- • You can hold balances in multiple currencies simultaneously
Get Your Foreign Currency Bank Account Details
For some of the currencies, like Euros, Dollars, and British Pounds, you will find the bank account details that you can share with people that need to pay you:
They will then be able to send money to this account, just like they would do a local bank transfer. It will be completely free for them and for you.
- • Get local bank account details for EUR, USD, GBP and other major currencies
- • Share these details with clients - transfers appear as domestic for them
- • Receiving money this way is completely free for both parties
Convert or Transfer Your Money
Next, if you want to use, you can simply click on the 'Convert' button on the account where you received the money to convert what you received to the currency of your choice, or you can also directly wire it to a bank account of your choice. Here are the details of one of the conversion I did recently:
As we saw before, this is the only step where you will have to pay a small fee, which is much lower than the one at your bank. Also, Wise will always give you the best conversion rate of the moment.
Once that's done, you can then also choose to send the money back to your own bank account, which is also completely free.
With all of that, you can now get paid in a foreign currency, and use Wise to receive the money for free, and then transfer it back to your local bank account if you want, while making huge savings compared to your local bank.
- • Conversion fees are minimal (e.g., €2.98 on $1,000) compared to traditional banks
- • Wise always uses the real market exchange rate
- • Transferring to your own bank account is free
- • On $1,000 transfer: receive €852.59 with Wise vs €786.45 with traditional bank - save €66.14!
💡 Pro Tips
Use Wise as your primary receiving account for international payments to maximize savings
Keep your traditional bank account for legal purposes if needed
Wise offers additional benefits: nice interface, mobile app, free debit card, and easy transfers
Perfect for Amazon Affiliate Program payments which only pay to US bank accounts
Final Thoughts
Who Should Use That?
There are two main use cases for what we saw in this article. The first one is if you are a freelancer, and you are getting paid from clients in foreign currencies.
The second case, which is the one I mostly use those days, is if you are an online entrepreneur and need to get paid from an online platform or service in a foreign currency. For example, a good chunk of my income comes from the Amazon Affiliate Program, which only pays in US Dollars to a US bank account. Which means that before, I had to receive a check (!) from them, and then I had to deposit it on my Euros account, with huge fees in the process. Now, I simply get paid for free on my Wise US balance account.
To conclude, I really recommend using Wise. Not only it makes it really easy to receive money from abroad in a foreign currency, but also it comes with a very nice interface, a nice mobile application, a free debit card, easy transfers, and much more. I actually now completely use it as my primary bank, and only keep my 'traditional' bank account for legal purposes. I am also sure that Wise will evolve even more in the coming years, with more currencies for example, making receiving & converting currencies even easier.