Is affiliate marketing ethical?

Sometimes you run into an amazing business, and you want to shout it from the rooftops.

Or at least, I do. Don’t you?

Recently I’ve been encouraging people to check out TransferWise, a London-based company that makes it much cheaper to send money from one country to another.

If you’ve ever moved abroad, you’ve probably had to send money from your bank account in the one country to your bank account in the other country. And if you did, I hope you didn’t send the money directly between your bank accounts, because doing so is often outrageously expensive.

Once upon a time, I sent a few thousand dollars directly from my American bank account to my Dutch account. Between the awful exchange rate that Bank of America offered me and the service fee, I paid hundreds of dollars. Ouch!

I’m fine with banks charging a fee for transferring your money abroad. But hundreds of dollars on a few thousand dollars is excessive.

TransferWise’s genius is that their service matches people who want to send money from country A to country B with people who want to transfer money in the opposite direction. Rather than sending everyone’s money across borders—which is expensive—they complete as many transactions as they can for free within each country, matching customers who want to send money in opposite ways. Then, they transfer the remainder internationally.

Smart, right?

The video below explains the process as well.

Of course, as a customer you don’t see what’s going on technically. You just get to send your money abroad cheaply.

And it works. When I recently transferred money from my American account to my Dutch account using TransferWise, at the mid-market exchange rate, I paid TransferWise a fee of only 0.8%. That’s an order of magnitude cheaper than what Bank of America has charged me in the past. An order of magnitude!

Here’s the thing: I love TransferWise because the company saves me money and because it seems to be run by good people. I like recommending TransferWise to people, because it can save them money too.

But when I recommend TransferWise to someone, I send them my affiliate link. In fact, the link to TransferWise at the top of this article is an affiliate link. That means that if you open an account with them through that link, and you make a transfer, I may receive a small reward.

To be precise, I earn $75 for each three people who open an account and make a transfer after reaching TransferWise’s website through my affiliate link. Fortunately, there’s something in it for the person new to TransferWise too: if you get to TransferWise using an affiliate link, you get a discount on your first transfer.

It’s not like TransferWise’s affiliate program will make me rich, but receiving $25 per person who signs up isn’t peanuts either. Not that I’ve made any money by recommending TransferWise so far—apparently people haven’t taken me up on my recommendation. But I could, eventually.

Think back to the start of this article. Did it sound like an ad? I hope it didn’t, but I wouldn’t be surprised if it did.

You see, I think TransferWise is a great company. It could save many of my international friends money. And I recommend companies that I love even when they don’t have an affiliate program. One example is Vanguard, my favorite business. I can’t speak highly enough of them. If you live in the U.S. and you want to invest your money, open an account with Vanguard. (If you live in The Netherlands, try Meesman instead.)

But back to my TransferWise affiliate link. Is affiliate marketing an ethical thing to do?

The Internet is rife with websites that use affiliate marketing in sleazy ways. Many a website that seemingly offers information for free earns money by tracking you and by selling your personal information. Others cram as many affiliate links into their pages as they can, without telling you. They’re clearly not interested in helping you; they just want you to click their affiliate links.

Taking advantage of people like that wouldn’t make me feel good. By contrast, it does make me feel good to recommend services that I enjoy using. But I don’t feel entirely at ease using affiliate links, even though I’d recommend the business in question—TransferWise, in this case—even if the business did not have an affiliate program.

In short, I’m asking you: is it ethical to make a buck from recommending a business you love? Do you do it? Do you wish more people would?

And if you do share affiliate links, how does sharing them make you feel?

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