Home Comparison Zelle vs PayPal

Zelle vs PayPal

Zelle and PayPal go head to head in this comparison of both money transfer services. In this joint venture we will be exploring the global coverage, payment options and overall safety of each brand, in a bid to discover who offers the best international money transfers for our customers.

Updated: 17/09/2021
Read time: 9 minutes
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PayPal is an online payment platform that has over two decades of experience in the money transfers industry. As pioneers of the financial technology industry, PayPal is one of the most well-known digital payment providers in the world and offers many different areas of financial services. Founded and headquartered in San Jose, California, PayPal is an American company now available in more than 200 countries.

By comparison, Zelle is a lot younger than PayPal, having been founded in 2011 under the original name of clearXchange. It functions as an online payment service, but its functionality and reach is a lot simpler than PayPal. Put simply, Zelle enables users to send electronic money transfers from one bank account to another, using their mobile device or the website of one of their banking affiliates. 

 In a bid to find out which brand is the better option for sending international money transfers, we will be exploring each area of Zelle and PayPal’s financial services. 

Which brand has lower fees?

Here we will take a closer look at the fees incurred by users of Zelle and PayPal’s money transfer services.

  • Zelle is an entirely free service and does not charge fees for sending or receiving money. However, double check that the bank or financial institution connected to your Zelle account does not charge their own fees.

PayPal operates as a payment processor for multiple uses: from online vendors to commercial users; and each service charges a fee. The complete list of PayPal fees is vast and can be viewed here. Find out more about the overall cost of PayPal money transfers in our full review of PayPal.

✅ Verdict: Zelle is a fee-free service

PayPal is often criticised for its excessive costs and multi-layered fee structure, but Zelle is a free service and shouldn’t cost users a penny.

Which brand offers better exchange rates?

Finding the best exchange rate can result in huge savings, depending on the country and currency of your international money transfer. We want to know whether Zelle or PayPal offers closest to the mid-market rate


All Zelle transactions are conducted in US Dollars. There is no possibility for currency exchange markups.


PayPal charges an exchange rate margin between 3.5 – 4% on most currency conversions, although the exact percentage added is not clearly shown when you are initiating a transfer. 

As an example, sending from GDP to AUD would give you a markup of 4% on the mid-market rate.

✅ Verdict: PayPal wins big

Zelle does not offer international money transfers which means PayPal is the obvious winner of this category, despite not offering remotely competitive exchange rates.

Which brand covers more locations?

If you are looking to send money overseas it is important to know which countries and regions are supported by both Zelle and PayPal.


Zelle is available to customers in the United States only: you must have a US bank account to use Zelle services.


PayPal is available in more than 200 countries: the company supports transfers between 25 popular foreign currencies.

✅ Verdict: PayPal wins here

PayPal is able to offer customers global location coverage, while Zelle services are limited to domestic money transfers only.

Which is faster?

Next we will analyse the speed that each brand is able to deliver funds from one account to another, to get an understanding of who is the faster money transfer provider of the two.


Zelle transfers are instant and typically completed in a matter of minutes, although transfer times can vary from bank to bank.


Due to the array of payment services available with PayPal, the transfer time of their financial services greatly differs from minutes to up to 5 working days. 

When sending money from one PayPal account to another, the process is instant.

On the other hand, withdrawing from your bank account and then converting funds into a foreign currency will take 3 – 5 working days.

✅ Verdict: This one’s a tie

Although some of PayPal’s international payment services may take 3 – 5 business days, Zelle cannot compete due to its limits as a domestic money transfer service, and therefore cannot be compared. When comparing the speed of a transfer from one account holder to another, both brands offer instant delivery.

Which brand offers more transfer & payment options?

In this section we will be looking at whether Zelle or PayPal is the more versatile option when it comes to available transfer and payment methods. 


Transfer types:

  • U.S. based bank transfer only

Payment options:

  • Zelle balance 
  • Bank transfer
  • Debit card

PayPal’s payment options include bank transfer, credit card, debit card, or transferring via your PayPal account

Users can choose to receive the funds either by bank transfer or by PayPal account transfer: moving money to and from PayPal accounts is always much faster.

✅ Verdict: PayPal offers more of a variety

Zelle offers a straightforward bank-to-bank transfer service, without offering as many payment or transfer options as PayPal. Also, it is not possible to connect a credit card to Zelle. Generally, PayPal is the more versatile brand in this category.

What do users have to say about each brand?

The best way to get a feel for the overall satisfaction rate of any international money transfer provider is to check out what customers are saying about them. 


Zelle is exclusively available as a money transfer app so the best way to gauge customer satisfaction is by checking out the reviews on the Google Play and App Store. Android users have rated the Zelle app 4.2 out of 5 on Google Play Store, while iOS users have given the app a 4.8 out of 5. This suggests Zelle may operate better on the iPhone. 

Elsewhere, Zelle has a reputation for being a low-cost, convenient and easy to use peer-to-peer payment method. However, the service is let down by its inability to facilitate international payments.


The PayPal app has been rated over 3 million times by iOS and Android users. It has been awarded 4.2 out of 5 on the Google Play Store and 4.8 on the App Store which levels out to an average rating of roughly 4.5 out of 5.

Positive feedback praises the app’s fast and easy mobile transfers, high quality data encryption and convenient two-factor authentication, as well as praise for PayPal’s Buyer and Seller Protection programme. 

Negative comments relate to technical issues, dissatisfaction with the user interface and high profit margins applied to foreign currency transfers. Further to this, some users report delays to the release of funds sent from other PayPal accounts and some find it easier to use the website than the mobile application.

Verdict: Zelle has the best reputation

PayPal has been around for over 20 years, and like any long-standing business, it has attracted its fair share of negative reviews. However, despite being the newer company, based on customer reviews Zelle appears to hold its own. Due to its consistent high performance in the area of domestic money transfer, Zelle has the better reputation of the two.

What brand offers better ease of use, accessibility, transparency & security??

We will look carefully at each of these factors to determine which company offers the best overall experience for customers.


Ease of use: customers are fond of Zelle’s straightforward design and clear messaging. Further to this, users do not need to download and learn to navigate a separate app in order to utilise Zelle services. 

Accessibility: Zelle can be used on most mobile devices and is widely accessible across the United States due to its integration with the online banking of most financial institutions. It’s only downfall is the fact it is not compatible with international banks. 

Transparency: Zelle is transparent and does not employ any hidden fees or complex terms of service. 

Security: While Zelle employs bank-level security it does not protect customers from fraud and, unlike banks, the company cannot cancel or salvage funds once sent. Instead, users are asked to exercise special caution when making money transfers, and the onus of protecting funds falls on the customer. For this reason, Zelle advises customers to only send money to people they know and trust to avoid any scams.


Ease of use: Due to its long standing reputation as one of the biggest payment platforms PayPal’s recognisable user interface is well-liked, and the website and mobile app is widely considered quick and easy to use.  

Accessibility: PayPal is available in more than 200 countries making it one of the most widely accessible money transfer companies in the world. However, some online reviews cite unresolved accessibility issues related to unexplained account freezes, close and password problems. 

Transparency: The company has been publicly criticised on many occasions for failing to provide transparency in areas related to account closures, restrictions and other problems related to their financial services. In June 2021, a digital rights advocacy group penned an open letter to PayPal, accusing the company of censorship and demanding more transparency and accountability.

Security: PayPal payments are protected by multiple layers of security and fraud prevention, including two-factor authentication, data encryption as well as PayPal Buyer and Seller Protection.

✅ Verdict: PayPal wins, but only just

There is no denying Zelle’s user-friendly and widely accessible services are popular with customers of all ages based in the United States. The company is also known for its transparent approach to straightforward bank transfers. This being said, PayPal’s security is iron-clad, their platform is globally recognised and can be accessed by customers in more than 200 countries, multiple languages and over 25 currencies. For this reason, PayPal wins in this category. 

Additional features

Finally, we take a look at any additional features that separate Zelle and PayPal apart in the battle for the most superior money transfer company. 


Nothing to note

  • PayPal Payout: Mass international payments for business
  • PayPal Credit: Buy now and pay later using monthly instalments 
  • PayPal Cash Card: Get a free Mastercard® debit card to use for contactless in-store payments or online purchases everywhere PayPal Direct Deposit: Deposit paychecks or government payments online into your PayPal account
  • PayPal Cash: Deposit cash over the counter at over 100,000 locations across the United States
  • PayPal Check Cashing: Take photos of your checks using this feature for instant deposit into your PayPal account

✅ Verdict: PayPal wins by a landslide

Zelle functions purely as a peer-to-peer domestic money transfer service, whereas PayPal offers a vast range of payment services to users around the globe.

Bottom line – who is better?

As a financial services giant PayPal is the clear winner of this comparison. Zelle fails to keep up with the innovative offerings of PayPal, instead focusing on finessing domestic money transfers between known and trusted contacts based in the United States. PayPal is reliable, secure and easy to use, and despite some criticisms of their high fees and unanticipated account closures, PayPal boasts a monthly customer base of over 400 million people. The two main downfalls that are holding Zelle back are the lack of international money transfer services and the fact funds cannot be cancelled or recalled, meaning customers’ money is not protected from scams or fraud. 

If you want to learn more about Zelle or PayPal, check out our full company review of each below, along with other useful company guides and comparisons. 

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April Summers

April is a journalist and full-time content writer for MoneyTransfers.com. Over the last decade she has written for a number of different online and print publications. Having lived overseas in Canada and Vietnam, April hopes to see more of the world as soon as possible, with Japan at the top of her travel list. As a former expat, April has first-hand experience of managing finances from overseas. She enjoys writing about forex trends and the future of banking.