Wise: Cutting Costs on International Money Transfers in 2024

What is Wise?

Wise (formerly Transferwise) is a payment system designed for fast international money transfers, offering fixed exchange rates and low fees.

Why use Wise?

By opening a Wise account, you can:

1. Receive money from 80 countries.
2. Send money to 80 countries.
3. Store and exchange money in 54 currencies.

Wise supports both personal transfers - to family and friends, and business transactions - for paying for goods and services.

There are no fees for opening or maintaining an account; you only pay a fixed fee per transaction.

Unlike traditional banks, there are no hidden currency conversion fees, saving you 2%-4% on transfer amounts.

Where does Wise operate?

A list of countries where Wise is available.

How does Wise work?

Wise's fees are 2-3 times lower than banks.

Why?

Wise holds accounts in various countries, so when someone makes a transfer, what's actually sent is a message indicating that money can be transferred to the recipient.

This saves on fees and speeds up the transfer process, with some international transactions completing in minutes.

Example

I'm in Ukraine and want to receive a €1000 payment for services from a client in Germany. How do I do this?

There are two options:

1. I create a Wise account.
2. The client creates a Wise account.

First option: I create an account.

1. I open a Wise account and get banking details for euros within the account.
2. I give these details to the client. For them, this payment is like a standard bank transfer, from euro to euro, with minimal fees. The money will take a few hours to transfer.
3. After the transfer, the money arrives in my Wise account. Then, I can withdraw it to my Ukrainian bank account in any currency.

I use Ukraine as an example, but the process is the same for any country where Wise operates.

Second option: The client creates an account.

1. We only need to provide our local bank account details. I give my IBAN in hryvnia to the client.
2. The client logs into Wise, specifies the amount and currency for the recipient, immediately sees the conversion rate, the transfer fee, and how long the transfer will take. Unlike other payment systems, Wise converts money at the interbank rate.
3. The client is given the details for sending money in euros, and after sending, we receive the money in our hryvnia account.

Example of transfer fees

For a non-urgent transfer of €1000, the fee is €16.98, which is 1.7%.

A bank could charge €20-30 for the same transfer, plus a 2-4% currency conversion fee.

Some screenshots in the article are old, but the article was updated on February 23, 2024.

This scheme can also be used to send or receive money to/from family and friends.

Whether to create an account for yourself or ask the sender to do so depends on preference, as opening an account is free.

You might find it more convenient to receive money directly into your local bank account.

In our example with the client from Germany, it might be easier for the client to make a transfer from bank to bank using the details, and they might not want to deal with international transfers or payment systems.

In that case, it's better for us to create the account and provide them with the details.

How to Create a Wise Account?

The registration process is super easy.

1. Follow the link. My screenshots are in English, but you can choose Russian or Ukrainian. Click "Register" or "Get started."
2. Enter your email.
3. Choose the account type: personal or business.
4. Specify your country.
5. Verify your phone number.

After registering, you'll immediately go to the money transfer process.

If you don't need to make a transfer and just want to receive money through Wise, just click on the logo to exit the transfer creation.

There, you'll find the banking details for receiving money.

What are the Fees and Rates with Wise?

Next, we'll discuss making and receiving transfers, but first, let's look at the fees and conversion rates.

Wise's fee depends on the payment details:

1. The chosen currency.
2. The recipient's country.
3. The required speed of the transfer (the faster, the more expensive, you can choose for the transfer to complete within a few hours or a few days).

On average, it's 1%-2.5%.

When you create a payment, the fee is listed under "Our fee."

A visual comparison of Wise's fees versus other payment systems, such as WesternUnion, Monese, OFX, Xoom.

Example of converting €1000 to $1000.

What is Wise's Conversion Rate?

If we're supposed to receive $1000 in our Ukrainian account in hryvnia, how much will we get?

Other payment systems, like PayPal or Skrill, say they don't charge a fee for such a transfer, but they calculate a 3-4% currency conversion fee.

Wise doesn't profit from currency conversion; it calculates the rate based on the market average.

At the time of the screenshot, when Wise showed a rate of 1 dollar to 27.32 hryvnias, the interbank rate was 27.31.

When you create a transfer, depending on the chosen currency, the conversion rate is locked in for 2 to 100 hours.

If you complete the payment within this time, the rate is guaranteed.

How to Receive Money via Wise?

We have two options for receiving transfers through Wise:

1. The sender creates a Wise account, specifies our regular bank account, and sends the money using the Wise-provided details, which we then receive into our bank account.
2. We create a Wise account, obtain account details in various currencies within the account, and provide these Wise-generated details to the sender. They send the money, we receive it in our Wise account, and then we can transfer it to our own account.

For the first option, all we need to do is provide our details at the local bank.

The screenshot shows how to obtain the details in Monobank.

After passing our details to the sender, they need to make the transfer on the Wise side.

We'll discuss Wise transfers in more detail further on.

The second option.

We create a Wise account and give the details to the sender.

1. Open the account and go to the homepage.
2. On the left, select "Open a balance".
3. Choose the currency for the future account. We can open an account in 9 currencies - US dollars, Australian, Canadian, New Zealand or Singapore dollars, as well as pounds, forints, and Turkish lira. If we don't need the details, for example, if we were using this account only for holding or converting currency, we could choose from another 50 currencies.
4. After selecting a currency, the account will appear in the list on the left. Click on "Get account details for your balance".
5. Next, we will need to verify the account by funding it with $25 in your local currency. These funds will be fully credited to our account, and can then be withdrawn.

After verification, we will have access to the details we can pass on to the sender.

Also, the first time we might need to confirm our identity with documents.

We can give these details to our clients or friends, and they can make internal transfers using them.

List of currencies for which you can obtain bank details in Wise.

How to Make a Payment Request in Wise?

To make a payment request, select the required currency and press "Request".

Specify the amount and get a link that you can send to a client or friend.

How to Withdraw Money from Wise?

To withdraw money to your account or to make a transfer to someone else, you need to click "Send money".

The procedure is as follows:

1. Specify the amount and currency.
2. Choose whether it's an international payment or a payment in one currency. At this stage, the fee and the transfer speed will be calculated.

You can choose the transfer speed yourself. If you're not in a hurry, you can save some money.

For example, 1000 euros can be delivered in 4 hours and it will cost 4.51 euros, or in 3 days and it will cost 0.41 euros.

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Next, you need to specify where and to whom you are sending the money.

You can also send money to yourself, thus withdrawing money from Wise.

Bank details must be specified in the international IBAN format.

If you do not know the recipient's details, you can specify just an email. Wise will send them an email to clarify the details.

At the next step, you need to specify the reason for the transfer.

Choose the most suitable option from the list.

Next, Wise will suggest you review all the information and proceed to payment.

You can schedule the transfer for a specific date.

If you have money on your Wise balance and want to withdraw it to your account, no additional steps are required.

But what if you want to make a transfer to someone else and there are no funds on your Wise balance?

You need to top it up.

How to Top Up Wise?

To make a transfer with the details you provided, Wise needs to somehow receive money from you.

You choose how exactly to receive it.

The method also affects the fee, as banks and payment services take their percentage.

For example, you can pay the required amount directly on the website via Apple Pay or Google Pay, but it will be slightly more expensive.

If you want to save money, you will need to make a SWIFT transfer using the details provided by Wise.

Check with your bank's support on how to make a SWIFT transfer.

How to Use the Wise Debit Card?

In some countries, Wise offers a debit card.

Using the Wise debit card abroad simplifies managing finances in different currencies with these key features:

• Multi-Currency Access: Spend in over 50 currencies at the real exchange rate.
• Automatic Conversion: Automatically uses the best rate from your account's currencies.
• Low Fees: Transparent, minimal fees for conversions, often cheaper than banks.
• ATM Withdrawals: Free up to a certain limit, with low fees thereafter.
• Contactless Payments: Quick, secure tap-and-go transactions.
• Security: Instant card freeze/unfreeze via the app for lost or stolen cards.
• Global Acceptance: Accepted worldwide wherever Mastercard or Visa is accepted.
• Instant Notifications: Real-time alerts for all transactions.
• App Integration: Compatible with financial management apps.
• No Transaction Fees: No fees for spending currencies you hold.

This card offers a cost-efficient, secure, and convenient way to access and manage your funds while traveling internationally.

Wise Business Account

In some countries, Wise allows the opening of a business account with additional services:

1. Business Cards: Wise provides debit cards for businesses, enabling easy payments for goods and services from a multi-currency account.
2. Expense Management: The platform offers tools for managing expenses and monitoring transactions in real-time, simplifying accounting and financial planning.
3. Batch Payments: The ability to send bulk payments, which is ideal for payroll or paying overseas suppliers.

Wise Support

Wise has a very user-friendly website and a commission calculator.

But if you need to ask a question to a live person, you can do so by email or phone on this page.

Comparing Wise and Payoneer

Payoneer is a popular payment system for withdrawing money from websites and receiving payments from clients.

Payoneer has low commissions, but there are limitations on personal transfers.

If you planned to accept payments for services or goods, explore how Payoneer works.

Comparing Wise and PayPal

PayPal operates with restrictions in some countries.

Only personal transfers are possible.

You cannot receive money for goods or services.

If you plan to use PayPal for personal transfers, consider the conversion commission.

PayPal may claim not to charge a transfer fee but charge a 3-4% currency conversion fee.

Comparing Wise and Skrill

Skrill is an international payment system that allows personal and business transfers between countries and buying cryptocurrency.

Similar to Wise in the ability to send money abroad, but Skrill has higher commissions.

3.5% for currency conversion, plus an additional 2% to 8% for card withdrawals.

Reviews about Wise

I've received several transfers to my Ukrainian account via Wise, and everything was great.

While preparing this article, I researched Wise reviews on the Trustpilot service.

Wise has 200,000 reviews with an overall rating of 4.2/5.

For comparison, Payoneer has 50,000 reviews with a rating of 4.4/5, and Skrill has 17,000 reviews with a rating of 4.2/5.

All three payment systems work well.

Negative reviews are mainly related to short-term fund freezing and verification of documents or details of the provided services.