Is Wise a Bank? Short answer: no, it is not. The company does not hold a UK banking licence and balances are not protected by the Financial Services Compensation Scheme (FSCS).
Long answer: Wise is not a bank as it does not lend out customer deposits to third parties. It is primarily a low-cost international money transfer app that allows users to save money when sending money abroad.
However, Wise provides some of the features that banks also provide, such as holding and exchanging multiple currencies, sending and receiving payments, and a linked card.
Wise offers three main products: Wise Account, Wise Business, and Wise Platform.
Why do people ask “Is Wise a Bank?”
The firm is defined as a Money Services Business. With a Wise account it is possible to hold a balance of funds in more than 40 supported currencies. However, this money is not protected by the standard FSCS guarantee, which covers balances up to £85,000 per eligible person, per bank.
Wise lets customers send payments to more than 80 countries and spend internationally with the Wise card. Local bank details are provided for up to nine currencies including US dollars, pound sterling, euros,
Wise was launched as Transferwise in 2010 as a peer to peer currency network, helping to revolutionise money transfer services, which had formerly been dominated by Western Union.
The group has since grown to provide money transfers to over 15 million customers sending more than £9 billion a month.
Its transfers work by matching up buyers and sellers of currency in different countries, rather than moving money internationally.
The latest Good Money Guide review of the app in August found Wise to be “one of the cheapest and easiest ways to send money abroad”.
One criticism was that the firm does not have a telephone number and as such it is not possible for customers to contact the firm this way if there is a problem with a transfer.
If you are looking for a bank account in the UK, you can see a list of current bank account switching offers below:
| Bank Account | Switching Offer |
|---|---|
| Halifax | £60 reward, 15% cashback & 0% overdraft interest |
| Santander | 1-3% cashback on bills from Santander |
| Chase Bank | 1% cashback for a year with Chase saver account |
| Monzo | £5 when you refer a friend to Monzo |
| Monese | €15 for every friend you refer to Monese |
| Curve | £15 + 1% cashback when you open an account with Curve |
| Revolut | £10 top-up offer plus a month of Revolut premium free |
| Barclays | 25,000 Avios when you switch to Barclays |
| Nationwide FlexDirect | £200 reward, up to 8% interest on regular savings & 0% interest on overdraft of up to £1,500 |
| First Direct 1st Account | £175 reward, up to 7% interest on regular savings, no fees when abroad |
| Lloyds Bank | £175 reward, up to 6.25% interest on regular savings, free gift (e.g. six cinema tickets) |
| TSB Spend & Save | £150 reward, £10 per month cashback for six months |
| Co-Op Bank | £125 referral reward to you and a friend if an existing customer of Co-Op Bank refers a new customer |
| Starling Bank | No switching offer |
Robin has more than six years of experience as a financial journalist, most of which were spent at Citywire, and covers the latest developments in the investing, trading and currency transfer space. Outside of work, he enjoys reading literature and philosophy and playing the piano.
You can contact Robin at robin@goodmoneyguide.com
