How Wise Works (or not)

About Author: Hi, I’m Quinn Askeland. In 2014, I started Transumo after experiencing expensive, slow, and frustrating international money transfers and payments through banks. Once I discovered how to manage my own international currencies much better, I became driven to help others improve their transfers and payments. Fortunately, today, there are many excellent options. See My Full Bio.

Wise (was Transferwise) is known for its ability to help international people and businesses.

How Wise Works

Wise works by solving a big problem many people and businesses face when dealing with multiple currencies.

Wise has three parts to their service:

  • International Money Transfers
  • Multi Currency Account
  • Prepaid Debit Card

In this article, we will explain how each part of Wise works individually and together.

If you need to go deeper, we have in-depth reviews for all three – Wise Money Transfers (review), Wise multi currency account (review) and the Wise debit card (review).

Disclosure: This post contains affiliate links which may save you money. For more information, see my disclosures here.

Wise has a solid 4.2/5 rating on Trustpilot, based on over 193,000 reviews. Of these reviews, 83% are 5-star reviews, while 7% are 1-star reviews. Wise customers praise the ease of use, low fees, excellent exchange rates, and overall convenience of using Wise for international banking.

How Wise Works for Individuals and Businesses

When Wise started out (originally called Transferwise) they just focused on being excellent at inexpensive money transfers.

Some people happily use them just for money transfer – in fact they now move over $7 billion every month.

But if you are an international person, like an expat or freelancer that gets paid in a different currency or wants to pay in a different currency – Wise could be a great solution.

Essentially you can get paid, pay others and spend in pretty much any currency from one place without getting hammered by fees. They say, up to 8x cheaper than banks and 3x cheaper than PayPal, but it really depends on your currencies and the amounts.

So you have four options: Their (1) money transfers, (2) multi currency account, (3) prepaid debit card. or (4) a combination.

The sign up process is easy – once you have signed up for either money transfers or the multi currency account, you can opt into the others.

1. International Money Transfers

How Wise Money Transfers Work?

After you check “What currencies you can send to and from?” – Wise works by enabling you to check the fees before you sign up. Assuming all is good, after you sign up, you can set up the transfer based on the speed and how you want to fund the transfer. By default, Wise will notify you when money is about to arrive, but if you log in they also show you each step of the way where your money is.


Wise sends to over 160 countries and has a simple guide to see if they will work for you.


Wise has transparent fees and lets you send money at the mid-market or interbank rate – that is, the rate which major financial institutions and banks use for swapping currencies.

In 2022, Wise charges on average about 0.6% in service fees (depending on the currency and amount) and doesn’t add a margin to the exchange rate.

You can see the exact fees you’ll get on their website here for the amount and currency you’re sending.

There are no hidden fees to send money abroad with Wise because they have local bank accounts in all the areas they service.

(We recommend OFX and TorFX for large bank transfers because of their 24×7 phone support).


Wise’s transfer speeds are very good and the majority of transfers can be completed practically instantaneously although some take a few days or more for lesser know currencies.

How do you send money using Wise?

Before you start sending money, you need to create and verify your account. Go to Wise’s website, click on “Register,” choose your location, and sign up for an account with your email address.

After signing up, you’ll need to share some personal documents like address proof and a government-issued ID (like passport, driving licence, etc.) to get your account verified (which usually takes up to a week).

How do you set up a transfer?

Enter the amount and currencies you’re sending, then you will be asked for your recipient’s details and how you would like to fund the transfer.

After Wise receives your money, you’ll get a confirmation via email and text. You can track your transfer by logging into your Wise dashboard online or by downloading the Wise app.

How do you receive money using Wise?

If you already have a Wise account account set up, you can request payments to your Wise account in the currency of your choice.

First, you will need to select the currency you want to receive.

You can then receive payments and salary, as well as set up Direct Debits.

Each currency comes with local bank account details so you can look like a local.

Note: Freelancing with global clients or own a small business? Check out the Wise Business Account.

Learn more about the Wise transfers in our Wise (review).

2. Wise Multi Currency Account

How the Wise multi currency account works

The Wise multi-currency account is available in these countries, including the US, Canada, the UK, EEA countries, Australia, New Zealand, Singapore, etc.

You can hold over 40 currencies in the Wise multi-currency account and exchange between them at no extra cost.

When you sign up for the multi-currency account, you also get the option to open local receiving accounts in 10 currencies USD, CAD, GBP, EUR, AUD, NZD, SGD (Singapore dollars), TRY (Turkish lira), RON (Romanian lei), and HUF (Hungarian Forint).

These accounts come with an international IBAN and let you send and receive money like a local.

You can receive your salary, set up direct debits, and use your Wise MasterCard debit card to spend in the currencies you hold (at shops, ATM withdrawals, online payments, etc.).

There are no charges to open and hold an account, however, holding money above a certain limit attracts fees.

Wise is not a bank and the money you hold in your account is not protected by government schemes.

You might also like Is Wise Safe?

Learn more from our review of Wise multi currency account.

3. Wise Mastercard Debit Card

How the Wise Debit Card Works?

The Wise MasterCard debit card is linked to your Wise multi-currency account and you can use it to withdraw money from ATMs at home and abroad (limits and fees applicable) as well as pay in-store where Mastercard is accepted (contactless enabled).

You can also shop online with the Wise Mastercard debit card in currencies you hold.

There is a one-time fee for issuing the card (location specific): $9 USD / £5 GBP/ €6 EUR/ $10 SGD/$10 NZD/$10 AUD
ATM withdrawals are free up to a limit (200 GBP/EUR/$100 USD per month) and a fee of 1.75-2% of the amount is applicable after that.

Discover more from our Wise card (review).

4. The Wise Apps

How do the Wise Apps Work?

The Wise App is available on both Android and iOS and they’re both highly rated (4.6/5 with over 24,000 reviews on the App store and 4.2/5 with over 1,90,000 reviews on Google’s Playstore.)
You can use the app to track rates, send money abroad, and cancel your transfers.

If you hold a multi-currency account, you can check how much money you hold in specific currencies, convert between them, and block or unblock your Wise MasterCard debit card.

You can also use the app to invite friends, use Apple Pay and Google Pay, set spending limits, etc.

The app has two-factor verification and sends you notifications for all account activities to keep your money and data safe.

5. How Wise Makes Money

Wise (also known as Transferwise), is an international money transfer service that allows individuals and businesses to send money across borders with transparent and much lower fees compared to traditional banks.

Wise is able to keep costs low by carefully “managing its book” through swapping inflows and agreements they have with the traditional banking system. Instead of using the traditional method of transferring money, which often uses SWIFT in isolation and can result in hidden fees and unfavorable exchange rates, Wise’s system reduces costs and speeds up transfers.

Wise is also heavily focused on the user experience in all that they do including their App, online, and customer service

Now, let’s learn how Wise keeps things affordable by being smart with their money moves and making sure your experience is smooth as butter. It’s the backbone of how they handle their money stuff.

Source: Trading Update for their listing in the London Stock Exchange

Most of Wise’s revenue comes from the service fee charged for money transfers abroad – usually between 0.35% and 1% of the amount.

They don’t charge a margin on the exchange rate and the savings are passed on to the user.

Other ways Wise makes money:

  • Growing their customer base
  • Adding on services
  • Card issuing fees
  • Fees on ATM withdrawals above the prescribed limit
  • Fees for holding money above the recommended limit
  • Card replacement fees

Overall, Wise’s pricing is considered to be very good and they’re one of the cheapest ways to send money internationally and travel abroad.

Bottom Line

Wise’s name may have changed, but their commitment to solving problems for international people has remained unchanged over the years.

For transfers, they’re one of the few money transfer services to offer transfers at the mid-market rate and show the exact breakdown of fees using their calculator before you even set up an account with them.

You can also get a rate guarantee for 24-72 hours, which should give you plenty if time to fund the transfer.

The Wise Multi-currency Account can be a game changer in how you can manage your international money.

After decades of high fees, slow, messy currency exchange and international money transfers, Wise works.

Happy Money!

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