Introducing Wise – the money transfer and business account specialists

1st Formations has partnered with Wise to provide our customers with an affordable way to send and receive money in different currencies.

This complete guide will explain everything you need to know about Wise, including what it is, what it does, how to use it, and what separates it from other payment providers.

What is Wise?

Wise has been around since 2011 – but you probably know it better by its old name TransferWise.

When the fintech business launched, The Guardian named TransferWise one of “East London’s 20 hottest tech start-ups” because it offered customers a simple and transparent solution to a centuries-old problem: how can you affordably transfer cash overseas?

Fast forward ten years and TransferWise (or “Wise” as it’s now called) has grown by leaps and bounds. More than 10 million people now use the company’s services to move more than £4.5 billion each month. Those users hold balances in 55 currencies – saving an estimated £3 million in hidden bank charges every single day.

Wise is regulated just like any other financial institution. The company follows a strict set of rules set by regulatory agencies in every one of the countries it operates in – including the UK’s Financial Conduct Authority (FCA) and the USA’s Financial Crimes Enforcement Network (FinCen).

So, why did TransferWise change its name to Wise?

Simply put, TransferWise changed its name because the business now does more than just help people make foreign cash transfers. Among other services, Wise now also offers integrated services for banks and businesses, plus the competitive and multi-currency Wise debit card for individuals.

So, now that we’ve covered who Wise is. It’s worth taking a look at exactly how Wise works and how it can benefit your business.

How does Wise work?

The way Wise works is pretty simple:

1. First, check Wise fees and exchange rates

If you’re new to Wise, just use the calculator on the Wise homepage to tell them how much money you want to send and where you want it to go.

You’ll then see what the exchange rate will be and how much of a fee Wise will charge you – without even logging in or setting up an account.

Wise uses what’s called “the real exchange rate”. This is the mid-market rate you’ll see on other independent sources like Google and Yahoo! Finance. Depending on the type of currencies you’re using, Wise may have additional price comparison tools you can use to scan the market.

2. Create an account

If you’re happy with the rate and fees, the next step is to set up an account with Wise. Wise charges a one-off fee of £45 to open your first bank account, but once paid, all other bank accounts are free to open.

It’s important to note that, although you need an account to send money using Wise, the recipient doesn’t need to have a Wise account. You can send money directly to their traditional bank accounts.

Depending on which country you’re from, Wise might need to verify your identity. This can take between 1-3 days – but the process is pretty simple from a user’s perspective.

If you want to learn more about the verification process, you can check out Wise’s Guide to Getting Verified.

3. Enter payment details

After you’ve set up an account, you can continue with your transaction. All you’ve got to do is enter the details of who you’re sending money to and their local bank details.

You can send money to an individual, a business, or even yourself.

4. Pay for your transfer

After completing your payment fields, you’ll need to pay the fee to initiate the transfer. This is normally done by card or by connecting your ordinary bank account to your Wise account and making a transfer.

If you’ve got a balance in your Wise account already, the fee can just be taken out of your Wise account automatically if you choose.

That’s literally all there is to it. After that, Wise will start the transfer – and for one in three transfers, the cash arrives to its beneficiary instantly.

You’ll get an email notification when the payment goes through. Your recipient will get an email too if you provided their details as part of the payment information.

What is the Wise debit card?

When you set up a Wise multi-currency account, you can also opt to receive a free Wise debit card.

A Wise debit card can be used in 200 countries, it’s linked with Apple and Google Pay – and if you’ve got an existing Wise account, it only costs £5 to order one.

As part of the Wise borderless account, the Wise debit card is supported by Mastercard®, and it lets you spend money anywhere in the world at that “real”, mid-market exchange rate mentioned above.

Features of the Wise debit Mastercard® include:

• It’s free to pay with currencies in your account.
• You get free ATM withdrawals up to £200 a month.
• You will only pay a small conversion fee when you convert your money. This is normally between 0.35% and 1%.
• You can automatically convert your money at the real exchange rate.

With a Wise multi-currency account (with or without debit card option), you’ll get bank details to receive money from over 30 countries. You can choose from any or all of the following bank accounts:

• Australia –  Account number and BSB code
• UK – Account number and sort code
• Europe – IBAN
• USA – Account number and routing number
• Singapore – Bank code, bank name, and account number
• Canada – Institution number, transit number, and account number
• New Zealand – Account number
• Turkey – Bank name and IBAN
• Hungary – Account number
• Romania – Bank code (SWIFT/BIC) and account number

As part of your account, you’ll effectively get different personal bank details for each currency. You can then use those details to receive money from any of the above regions.

Overall, this account type lets you hold up to 40 different currencies from all over the world.

You can learn more about the Wise debit Mastercard® by visiting the Wise website.

What currencies does Wise support?

One of the biggest factors to consider when choosing a service of this type is how many currencies it supports.

There are two sides of the coin to bear in mind, here. First, there’s the number of currencies you can hold and convert money into. Then, there are the currencies that you can pay in (but not hold in your own account).

If you set up an account with Wise, you’ll be able to hold and convert money in 56 different currencies and send money to more than 70 different countries in that country’s local currency.

For full details, check out Wise’s worldwide currency coverage.

What is Wise Business?

If you run a business that often needs to send or receive money from overseas, you’re going to want to check out the Wise Business account.

Wise Business has the same bare-bones as the personal Wise account we’ve already talked about – but with Wise Business, you’re going to get a lot more bells and whistles that will make keeping track of your transactions and overheads much simpler.

By setting up a Wise Business account, your limited company can:

• Pay invoices in 70+ countries
• Pay up to 1,000 people at once (including both suppliers or payroll)
• Get an IBAN, routing number, sort code – all without relying on a traditional business bank
• Get Wise company debit cards that allow your staff to spend online and in-store with no nasty forex fees.

One of the benefits of using Wise Business is enhanced cash flow management. By using Wise Business, you’ll be able to move money between accounts instantly, and you’ll always know your positions because you’ll be managing each currency account using the same intuitive dashboard.

Can Wise send large transfers?

Wise Large Transfers is a specific service Wise offers for really large amounts of money.

When you use Wise Large Transfers, the transaction fee will get cheaper when you send an amount of £100,000 or more (or the local currency equivalent). You’ll benefit from a cheaper fee whenever you send a one-off large payment, or multiple times if you’re sending multiple monthly large transfers.

Does Wise use an App? If so, how good is it?

In this day and age, what good is a payments service without an easy-to-use app? That’s why Wise has a slick and intuitive mobile app that’s available in both the Apple App Store for iOS devices and the Google Play store for Android devices.

The Wise app (formerly called the “TransferWise app”) is incredibly useful insofar as it can do everything the Wise desktop site can do.

That means with the app, you can:

• Transfer money to over 70 countries
• Hold 50+ currencies and convert between them instantly
• Secure your transfers with two-factor authentication
• Pay invoices and bills
• Access your virtual Wise debit card, which lets you spend or withdraw money in more than 200 currencies
• Connect to supported platforms like Amazon, Stripe, Xero, and more

One advantage that the Wise mobile app has over using the desktop version is that you can always keep up-to-date with instant push notifications for every transaction. That means no matter where you are, you’ll always be kept in the loop on money coming in or out of your accounts.

Long story, short – Wise has a fast, intuitive, and secure app that makes controlling your transactions super simple.

How can you set up a Wise account alongside a limited company?

If you want to set up a limited company here in the UK, access to a business bank account is essential. Unfortunately, if you’re not resident in the UK, it can be a bit difficult setting up a business bank account for a UK limited company.

That’s where we come in. 1st Formations has partnered with Wise (formerly TransferWise) to provide our non-UK resident customers with a fast and frictionless international business banking service.

• Our Non-Residents Package - ideal for for overseas customers
• How does double taxation work?
• The most tax-efficient way to take money from a limited company

As we’ve already discussed, with Wise you can create an account in minutes and subsequently get access to a British bank account number and sort code, European IBAN, US account number and routing number and BSB code.

You’ll then be able to receive money for free and hold money in over 50 currencies – all with zero fees.

With the Wise Business account, there’s normally a fixed one-time onboarding fee you’ve got to pay to access your international account details. This fee is currently £45 (or equivalent in your local currency).

Here at 1st Formations, we include Wise UK Business Banking as part of the following company formation packages:

• Non-Residents Package
• eSeller Package

That being said, access to Wise Business Banking via 1st Formations is available for all overseas clients who are unable or ineligible to set up a UK-based business bank account.

Want to learn more about our various company formation packages and how you can set up both a UK limited company and an international business bank account in a matter of hours? We’ve got you covered.

So, there you have it!

We hope you have found this guide to our partner Wise useful.

No service is right for absolutely everyone, and you should always do your homework before committing to a new service provider – especially when your money is involved.

If you’re on the hunt for more information about doing business overseas, you’ve come to the right place. Check out the 1st Formations blog for regular tips, tricks, and updates about company formation, buying and selling overseas, international taxation, and more.