- Send money to an overseas bank account without paying a foreign exchange profit margin.
- Easy to understand fee structure with transparent transaction fees.
- Pay much less to send money overseas than you would through a traditional bank.
Wise (formerly TransferWise) is a money transfer company offering a high level of service at a low and affordable cost. They were set up to streamline the money transfer process by focusing on making bank account transfers more affordable and therefore more accessible.
They do this by charging low transfer fees and maintain transparency by converting currencies at the mid-market rate. This transparency is what sets them apart from other money transfer companies.
Wise rebranded in 2021 because the company now offers a wider range of financial services, including a borderless account.
Our review is focussed on the Wise money transfer service (we won't be talking about their borderless account and debit card here). It is based on several years using them for our own business to transfer hundreds of thousands of dollars.
Inside this review
Founders and backers
TransferWise was founded by Estonian duo Kristo Käärmann and Taavet Hinrikus in 2011. Käärmann was a financial consultant, while Hinrikus was previously working with Skype. It rebranded to Wise in 2021.
The company has also received financial investment from the likes of Peter Thiel, Richard Branson, and the venture capital duo Marc Andreessen and Ben Horowitz.
Credibility and security
Wise is regulated by the UK financial conduct authority FCA, US financial crimes enforcement network FinCEN, and by ASIC and ARPA in Australia. They make sure that your transactions are secure and that your data is protected.
The service uses a high level of encryption and data security, similar to the ones used by banks. Transactions are monitored 24/7 for potentially fraudulent activity, and your account data and activity is protected by two-factor authentication.
Wise international money transfers
Wise has an international money transfer platform that allows you to send and receive money using an account that isn't restricted geographically, unlike a traditional, single-country bank account.
Traditional banks enjoy a huge share of the financial banking scene, but as expected, they're stuck in their ways and often only operate in one country and with one currency. That is where Wise comes in. Once you breeze through the set up process people love to use Wise vs the traditional banks because of their competitive mid-market exchange rates, low fees and elegant user interface.
Low cost structure is Wise's most significant feature
Traditional banks also charge an absolute fortune in transfer fees, as well offering you unfavourable exchange rates if you wish to move money from one country to another. So, finding an option that won't restrict or exploit you is imperative.
In addition to having low transaction fees, Wise does not add a profit margin to its currency exchange rates, unlike banks and most of its other money transfer competitors. This means that when your Australian dollars are converted into other currencies, the bank account at the receiving end of the transfer gets more in the local currency than it otherwise would. And the exchange quoted when you are setting up the transfer is guaranteed for between two and 72 hours, depending on the currency.
If you've ever sent money abroad, you will understand how slow and expensive the entire ordeal can be. But Wise says that its international money transfers are up to eight times cheaper than bank transfers.
Example of fees
The transfer fee is a combination of a fixed fee depending on the conversion currency and a variable fee depending on the amount sent.
Sending $1,000 AUD to the UK, to be received in GBP, would cost you just $5.14 AUD in fees – a fixed fee of $0.66 plus a 0.45% variable fee of $4.48.
Sending $1,000 AUD to India, to be received in INR, would cost you $6.15 AUD – a fixed fee of $0.68 plus a 0.55% variable fee of $5.47.
That is far lower than the traditional banks and less than many of Wise's competitors.
You can send funds from Australia to over 60 countries in more than 50 different currencies.
What makes Wise special is that the currencies used in the transfer don't really matter, because you can choose to set up a Wise multi-currency account, where you can keep multiple currencies and convert them easily using the mid-market exchange rate.
How to sign up and send money
You can sign up online with Wise, or download the app, for free. To open an account and get verified you need photographic ID, proof of address and a photograph of you holding your ID. This process may take around two working days to be verified, so ideally plan ahead.
Next, choose the sending and receiving currencies and the amount you want to send, and you'll be shown the fees and when the money should arrive. You'll be asked for the recipient's bank account details, and you may be asked for ID, such as your driver's licence or passport. Finally, pay for the transfer.
Wise will notify your recipient that the funds are coming, and you can track the transfer in your Wise account.
You can fund your Wise international money transfer from a bank account via PayID, POLi or by using your credit card or debit card. If paying using a rewards credit card, you will earn points on the transaction.
Who Wise is designed for
Unlike many companies that have a definite target consumer, Wise aims to appeal to anybody who is put off by traditional banks' high fees and poor exchange rates. Money transfer services should not cost an arm and a leg.
The Wise website is set up for both individuals and businesses, and when entering the site you will notice that there are different paths you can follow depending on what kind of client you are.
Pros and cons
- Low fees explained upfront before you make the transaction.
- Fee structure is easy to understand, comprising a low flat fee plus a percentage based on the amount.
- Mid-market exchange rate used for currency conversions, with no profit margin added.
- Easy to use website, app, and transaction process.
- High transfer limit so you can send large amounts.
- Transparency is vital to their brand.
- Limited currencies and destination countries when compared with some competitors.
- Can only send funds to recipient's bank account, with no option for cash pick up.
- Transfers can be slow if you pay by bank transfer and need to wait for the funds to clear.
How fast is it to send money via Wise to another bank account?
It depends to a large extent on how you choose to pay for your transfer. Paying by debit or credit card usually means that the transfer can be carried out almost instantly, but a transfer from your bank account could take 2-3 working days to clear.
Are there any minimum or maximum amounts you can send?
There is no mention of a minimum, but it would certainly have to be enough to cover the fixed fee at least. Maximum amounts are $1,800,000 by bank transfer or $18,000 by card, and up to $50,000 using PayID.
Does Wise have any applications users can download?
As well as their sleek website, Wise has apps listed on the Apple App Store and the Google Play store.
Does Wise have dedicated customer support?
Wise has customer service that can be accessed by logging into your account. In our experience, they have been very good to deal with.
Will my bank charge me for using Wise?
You shouldn't be charged by your bank if you pay Wise using your bank account or debit card. However, payment by credit card could incur a cash advance fee and interest charges from the card issuer for as long as the balance is carried.
Is it safe to use Wise?
Wise employs a high level of security, including data encryption, secure data storage, two-factor authentication and constant fraud monitoring.
Is Wise better than PayPal?
Wise is different from PayPal and whether or not it is better will depend on your needs. The fee structure at Wise is easier to understand, and the exchange rate does not have an added profit margin. But PayPal offers more destination countries and the ability to transfer funds to a PayPal account rather than a bank account.
Wise places a high value on transparency and is a reliable option if you want to understand exactly how much your transfer will cost before you send it. Its transfer fees are certainly much lower than those charged by traditional banks, and the mid-market exchange rate used will usually be much better for you than the rate used by many of its competitors.
However, the sign-up process and the transfer itself can be rather slow in some cases. And if you want to send funds in a less popular currency or to an unusual destination, Wise may not be able to help you – yet – although more currencies and countries may be available in the future.