TransferWise, the money transfer platform that we all know and love, has been rebranded to “Wise”, effective February 22nd, 2021. The company is the brainchild of two colleagues who encountered similar dilemmas by getting paid in one currency, while having debts that needed to be settled in a different currency. This resulted in great uncertainty due largely to fluctuating exchange rates, which sometimes resulted in the loss of their hard-earned money.
Taavet Hinrikus and Kristo Käärmann are the founders of Wise. They both originated from Estonia. When faced with this annoyance of ever-changing exchange rates, they thought “surely, we can’t be the only people faced with this dilemma!”. It was from this discussion that the duo set out to create a solution not just to their problem but to the millions worldwide who also encounter money transfer challenges.
At its inception in January 2011, TransferWise specialized in money transfer from various countries across the globe. A change in name would 10 years later, be prompted by a need for the expansion of its services to satisfy the needs of customers. It was on this basis that the company rebranded and extended its service offerings to include the option of having a multi-currency account, a business account, and a debit card.
Wise boasts a huge client base of over 10 million people. These people entrust Wise to handle over $6.2 billion dollars on a monthly basis in money transfers. Servicing its customers is a staff of 23 team members, and the company is overseen by a board of directors. Some of the investors for Wise are Sir Richard Branson and the creator of PayPal – Max Levchin, along with other well-known names in the market.
Wise generates income by charging a small fee for funds transferred by a customer. Unlike traditional banks, money transfers work by having a customer transfer funds to Wise’s account, after which Wise wires funds to the recipient’s account in their local currency. For example, money transferred from Canada to Wise’s account would be received in Canadian Dollars and if the recipient is in the USA, then the funds would be received in US Dollars. Note that for a Wise funds transfer to be successful, the recipient must have a local bank account in the country to which the funds are being sent.
One disadvantage of Wise is the inability to provide an exact time frame within which the recipient can expect to received funds. This is as a result of the delivery date depending largely on several factors such as the type of currencies involved, or the time of day, or the day of the week the transfer was performed, just to name a few. Obviously these factors are out of Wise’s control and are also experienced by all their competitors. Luckily, real exchange rates are posted on Wise’s website, which enable a customer to know the rate at which funds are being received and sent at any given time.
Wise’s website provides its customer with a calculator which generates the costs associated with any transaction prior to being completed, to enable customers to make informed decisions regarding their money transfers.
The greatest advantages of Wise over its competitors are its affordable pricing and transparent fees. Fans of Wise also rave about its easy-to-use interface and lately its impressively fast transfer times. Therefore, if you’re in search of an affordable way of transferring money between various countries and in different currencies – Wise should be at the top of your mind and your one-stop shop.
For more information on Wise, check out our Transferwise/Wise Review.