Digital banks have been changing the financial market and the services you can get from your bank. They have become a formidable force and fierce competitor for traditional banks, thriving where traditional banks wouldn’t have trodden.
The unique features that digital banks like Wise offer have made them extremely attractive to individual clients. Wise, in particular, has been adding to its range of features and now has a fully-fledged account for businesses.
Like the individual accounts, the business account has impressive perks that make it attractive to small, medium and large businesses. Other digital banks have jumped on the train and also offer business accounts. The features vary widely, so knowing and understanding what each vendor offers is at the top of the list. Here’s a rundown of what the Wise business account offers.
Background on Wise
Wise launched in 2011 as Transferwise. It quickly became a global favourite among transfer services. It has garnered over 10 million transfers to 80 different countries.
For their 10th anniversary, the company changed its name to Wise because they were focusing on more than just transferring money. The company has upped its game with flashy new features and competitive global rates with the increase in competitors.
One of those spanking new features is the business account for a global market with features like allowing invoices and wages to be paid in different currencies and with real exchange rates.
Who Should Use a Wise Business Account?
The Wise business account is a good option for businesses that frequently make or receive international payments in multiple currencies. The account has no monthly fee. You will only pay for what you use. That lowers the overhead costs for businesses while allowing them to easily transact internationally.
With the Wise business account, businesses can make and receive payments in over 70 currencies with transfer fees up to 19 times cheaper than major brands like PayPal and six times cheaper than traditional banks.
The account also offers a range of transfer options, including one-by-one payments and mass-pay solutions, which is convenient for businesses of all sizes.
The account is ideal for businesses that value cost-effectiveness, transparency and speed. Additionally, businesses that require an API, batch payments and integration with other accounting software like Xero will find Wise a suitable option.
How Does the Wise Business Work?
It’s essential to stress that Wise isn’t a bank, and it isn’t registered as one. However, it gives you access to an account and other features like a business Mastercard. Because Wise isn’t a bank, it makes some things easier and cheaper than conventional banks. International transactions are a perfect example. They are more transparent with Wise.
Traditional banks have a wide variety of established requirements when it comes to sending and receiving money from overseas. Aspects of the transaction like the exchange rates, additional fees and service charges quickly rack up. Wise takes a different approach.
For instance, with Wise, you can lock up the current exchange rate for two days. That way, you don’t lose out if the rate changes before the transaction is completed. Also, when you use Wise to transfer money, it uses its own account in the destination country. The money never crosses borders, so it’s faster and cheaper.
How is Wise Regulated?
Wise is regulated in different countries, operating through government regulations and/or national banks. In the European Economic Area, Wise is regulated by the National Bank of Belgium (NBB) as an Authorised Payment Institution with passporting rights across the EEA.
Wise is registered with the Financial Crimes Enforcement Network (FinCEN) in the United States. In the UK, it’s authorised as an Electronic Money Institution (EMI) by the Financial Conduct Authority.
Is Wise Safe for Your Business
Wise isn’t licensed as a banking institution. But it’s not also making any investment moves with your money as the big banks do. However, they still have to abide by government institutions and laws considering e-money and payment organisations.
Another safety feature deployed by Wise is that the client funds are stored in separate accounts, and Wise cannot touch or use these funds. Wise also ensures that it does regular updates and patches to its software. Wise is also SOC 1 Type 2 and SOC 2 Type 2 certified and GDPR compliant.
Main Features of the Wise Business Account
The Wise business account has become a major competitor in the Fintech industry because of its unique features. They make it easy for businesses to transact worldwide conveniently and affordably.
Pros
The highlights of the account include;
- No recurring fees
- Easy invoicing
- Free debit card
- Transparent money transfers
- Ability to spend in any currency
- Receive money with low fees
Cons
- 2% fee for ATM withdrawals above £200
- £16 one-off fee to start receiving money
- The Wise card is not available in many countries
Fees
While the Wise account doesn’t have any recurring monthly fees, fees are attached to every transaction. Businesses should be aware of the costs of running the account, especially if they use it regularly or transact huge amounts because the fees will quickly increase.
The wise account is free to set up. However, businesses pay a one-time fee of £16 to start receiving money. There are no monthly fees meaning businesses can access the full range of the Wise business features right from the start.
There is a 0.40% charge annually to hold more than €70,000 in EUR balance. With the account, you get a free business debit card.
There’s a 65p fixed fee attached to sending money. The actual amount you incur will vary depending on the currency. You will also incur a 0.33%-3.56% charge to convert a currency using your card.
ATM withdrawals are free up to £200 for every 30 days. Above that, there’s a 2% fee charged for every withdrawal.
Mid-market exchange rate
Wise’s greatest asset is its mid-market exchange rate. Banks and money transfer services use this rate when they trade between themselves, but they rarely pass it on to the customer.
The rate is in the middle of the asking price and the selling price. It is considered the fairest rate and a market gold standard regarding currency exchange rates.
This is the rate that Wise gives you when sending and receiving money to and from people or businesses. The sources from where Wise pulls the rate are updated in real-time when the trading marketing is open. In addition to the mid-market rate, Wise allows you to lock in the current rate until the transfer is complete assuring you of the amount you or the recipient will receive.
Also, the Wise business accounts allow for a higher maximum transfer amount which is ideal for businesses with a high transaction value.
Transferring money with Wise
Sending and receiving money follows the same path you would expect with other financial institutions that do the same service.
You will need to share with Wise to facilitate the transfer of the money. This will include the amount of money you’re sending, the countries of origin, the destination and the currencies. You also have to provide the recipient’s name, address and bank details.
This isn’t the only way you can send money through Wise. You can also send money with only the recipient’s email address which saves you the trouble of getting all the other details.
Transferring money with only the recipient’s email
Wise can send your recipient an email where they can accept the transfer and enter the bank details themselves. This is handy if you don’t know their details or they’d prefer not to tell you.
Once the email is generated, they have 5 working days to accept the transfer, or Wise will refund your money back to you and cancel the transfer.
The Wise business debit MasterCard
The Wise debit card is another big part of the Wise business account. It is part of the multi-currency account, and it can be used internationally to pay business expenses and spend online or in-store without foreign transaction fees or annual fees.
The cards are customisable using numerous features, including setting spending limits, turning contactless on or off, and in-store and online payments for each business card.
You can use the card in most EEA countries, New Zealand, UK, US, Canada, Singapore and Japan. It’s not supported in other countries like North Korea, Chad, Burundi, Congo, Cuba, Libya, Yemen and South Sudan.
The fees and limits of the card will vary depending on your location and use of the card. With the Wise card, you get free ATM withdrawals worldwide up to £200 or its equivalent in other currencies. You pay a 2% fee per withdrawal for withdrawals over that amount. Also, team members can have their own cards on your Wise business account.
Multi-User Access (MUA)
Another feature that businesses find useful on the Wise business account is the multi-user access feature. It allows you to invite your team members to the account and give them different levels of access to your business account. Your team can have different roles like viewer, employee, preparer, payer and admin.
- Admin – An admin can view and manage everything, spend with a business card, and add and remove team members.
- Viewer – Viewers can view all activities of the account, download receipts, connect to accounting software and download statements.
- Preparer – The preparer can see all account activities, set up single payments for approval, download receipts, download statements, and contact customer support on behalf of the business.
- Employee – Employees can view their activity and spend with their Wise business card within the pre-set limits.
- Payer – Payers see all the account activity. They make and manage payments and convert balances, and download statements.
Wise Business Mobile App
Another big Wise business account feature is the mobile app. It’s clean, has a bright interface and makes it easy for users to review all their transfers and recur a payment with a click.
The app is Apple Pay and Google Pay enabled, and you can add card details via your camera instead of entering them manually, among other exciting features that make accounting and payment processing easier for businesses like;
Invoicing
If you don’t have an invoicing or accounting tool, Wise lets you make one-off payments, recurring payments and even mass payouts with excellent rates with their batch payment tool to create and send up to 1,000 payments with just one transfer.
Payments
You can also use the app to pay employees or freelancers at home or abroad. It’s easy to send them domestic and international payments. The best thing is that they’ll get paid in their local currency without recipient fees.
The recipient doesn’t need a Wise account to get their money. It goes right to their local bank account. All you need is their bank account details or email address.
API Integrations
Wise has expanded its offering to include an API that businesses can take advantage of. The API has many applications, including;
- Generating payments from the invoicing software
- Automating invoice payments, recurring transfers, payrolls and standing orders
- Simplifying expense reporting
- Track exchange rates and automate conversions
- Get real-time notifications on platforms like Slack
Wise Business Account Transfer Limitations
There’s no doubt that Wise has some great features, but what is on the flip side? Wise business transfers are more limited and monitored to personal transfers. There are some currency routes that Wise doesn’t support business transfers to or from due to the regulation of Wise in those countries.
Some of the currencies without business limitations include GBP, LKR, CZK, HKD, HUF, THB, EUR, KRW, CHF, ZAR, TRY, IDR, NOK, PHP, SEK, MXN, BGN, SGD, AED and MAD among others. On the other hand, some currencies have business limitations. These are AUD, UAH, NZD, JPY, NPR, CAD, CNY, INR, VND, BDT, PKR and USD.
The Wise business account has no transaction limits. However, there are limits depending on the source and destination currencies.
Wise Business Account Alternatives regarding currency exchange rates
Besides Wise, there are other digital banks that offer business accounts and have similar features and benefits that businesses can consider. These include the Pay iO business account and the Revolut Business account. Each account is designed to suit businesses with different needs. If Wise doesn’t offer the features and benefits that can help your business grow, you can look into alternatives like Pay iO and see what they have to offer.
