While the Fintech sector is struggling, Wise tries to establish itself as a new reference with ingredients to say the least original. This neobank, which today has more than 12 million users Active, intends to stand out with its money transfer functionality to competitive costs. But today it is much more than that. Here is everything you need to know about Wise.
What is Wise?
Born in 2011 under the name Transferwise, the company is the fruit of collaboration between two Estonian friends, Taavet Hinrikus and Kristo Käärmann. They started from a simple observation: banking costs for international transfers were excessive and not very transparent. From this frustration was born an original solution in the international money transfers sector.
Today listed on the London Stock Exchange, Wise has developed its own international payment network, allowing it to bypass the traditional swift banking system. This approach has enabled the company to considerably reduce transaction costs, while providing significantly shorter transfer deadlines than traditional banks.
Having become Wise, the company is today much more than a money transfer service. It offers a current account, a bank card and an offer for professionals. The whole thing is obviously managed from an application to do everything, as simple as it is effective.
What are the services offered by Wise?
https://www.youtube.com/watch?v=SGWQLPG-YH0
Wise today offers a complete ecosystem of financial services. At the heart of this offer is the multi-divest account which allows users to hold and manage more than 40 different currencies. This account is accompanied by local banking coordinates in 10 major currencies: User can thus receive payments as if they had a local bank account in each country.
The platform is also distinguished by its tariff transparency. Unlike traditional banks that often apply hidden margins on exchange rates, Wise systematically uses the average market exchange rate, billing only clearly displayed costs before each transaction.
How does money transfer to Wise work?
https://www.youtube.com/watch?v=bc-f9pwm-24
The WISE transfer system is based on a system that avoids traditional international transfers. Rather than physically sending money through borders, Wise uses a network of local accounts in each country where it operates. When a customer wishes to transfer, the money is first placed on the local Wise account in the country of origin. Then, the Wise account of the country of destination pays the equivalent to the beneficiary in the local currency.
This trick not only makes it possible to considerably reduce costs (up to 4 times cheaper than conventional transfers), but also to accelerate transfers. According to the company, 40% of transfers are instantaneous, 63% take less than 20 seconds and 80% are made in less than 24 hoursdeadlines significantly lower than 3 to 5 working days usually necessary for traditional international transfers.
How does the Wise account work?
The Wise account is distinguished from traditional bank accounts by its flexibility and its international dimension. It allows users to manage their money in more than 40 different currencies, with the possibility of instantly converting from one currency to the other at the average market exchange rate. Each user can obtain local bank details in 10 major currencies.
To ensure secure transfers, funds are protected in regulated banks (350 large banks are partners) and the account benefits from two factors authentication. The mobile application, available on iOS and Android, allows complete management of the account, with real -time notifications for each transaction.
What are the cards offered by Wise?
https://www.youtube.com/watch?v=JRRZPITP1R4
Wise offers two types of additional cards. The physical card (visa), usable in more than 170 countriesallows you to pay and withdraw money all over the world. It offers two free withdrawals up to € 200 per month and applies transparent exchange costs. It is also compatible with Apple Pay and Google Pay.
Wise also offers a virtual card which provides more security for online purchases. Users can create up to three virtual cards simultaneously. These cards can be instantly frozen or thawed via the application. Features that are already found in many competitors but which remain very interesting on a daily basis.
How does the Wise Business account work?
Wise is also aimed at professionals with its Wise Business offer. It meets the specific needs of companies with an international activity. The Wise Business account offers all the functionality of the personal account, enriched with professional functionalities such as multi-user management, integration with accounting software or even the possibility of carrying out payments up to 1000 transactions.
One of the most appreciated characteristics is the payment API, allowing companies to automate their international financial operations. Although the account requires unique configuration costs, the lack of a monthly subscription makes it particularly attractive for very small businesses, SMEs and start-ups.
How much is Wise and how does the company earn money?
Wise is distinguished by its tariff transparency and its policy of gradual cost reduction. The opening of a personal account is freeand the holding of currencies does not generate any costs. For international transfers, Wise applies a simple cost structure: a fixed amount per transaction and variable costs from 0.33% of the amount for major currencies. The international debit card costs 7 €, without monthly subscription fees, and offer Two free withdrawals up to € 200 per month. Beyond that, costs of 1.75% + € 0.50 per withdrawal apply.
Wise’s economic model is based on several sources of income. Although the company continuously reduces its transfer costs, it generates significant income thanks to the deposits of its customers. Indeed, the money deposited on the WISE accounts allows the company to generate interest income, part of which is donated to customers. To date, interest income has reached 230.2 million pounds Sterling, 37% of which were redistributed to customers. Wise can also rely on Wise Platform, an integration solution offered to businesses all over the world.
Wise’s growth strategy seems to work, evidenced by the 55% increase in its profits in the first half of 2024reaching 217.3 million pounds sterling. This performance is explained in particular by a base of active customers up 25%, now totaling 12.8 million users (11 million cards distributed) including more than 500,000 in France. Card -related income and other services have also experienced a strong increase, representing 29% of total income, compared to 23% the previous year. According to Wise, 3.4 billion euros were placed by customers, 35 million euros in currencies are in circulation, i.e. 4% of the world volume of individuals.
Who is Wise for?
Wise is aimed at a wide range of users, but some profiles are particularly profitable. Expatriates and frequent travelers appreciate the possibility of holding several currencies and using an international card without hidden costs. Freelancers working with international customers benefit from local banking contact details to receive their payments at no additional cost.
International development companies find in Wise a complete solution to manage their cross -border financial operations. Students abroad also appreciate the transparency of costs and the ease of use of the application. The neobank particularly appeals to young technophiles, accustomed to digital solutions and sensitive to tariff transparency.
Finally, although the brand does not communicate on this niche, Wise turns out to be the best service for expatriate users wishing to provide financial support to their families remained in their country of origin.
