Wise: What It Is and How It Works

Wise started as a money transfer service and has expanded to include multi-currency account features. The core function is moving money between countries and currencies with transparent pricing. Wise shows the mid-market exchange rate and charges a visible fee, rather than hiding costs in the exchange rate markup.

The service operates in many countries, though availability of specific features varies by location. Wise is regulated as a financial institution in multiple jurisdictions, including authorization from the Financial Conduct Authority in the UK and various state licenses in the US. It is not a traditional bank in most countries where it operates.

Wise provides account details in several currencies, which can make receiving international payments simpler. For example, users in supported regions can get local bank details for USD, EUR, GBP, and other currencies. This allows them to receive payments as if they had a local bank account in those countries. For more on how these accounts work, see multi-currency accounts.

Wise offers several features that address common expat banking needs. Each works differently than traditional banking equivalents.

People typically consider Wise during the early stages of planning a move abroad or shortly after arrival. It often serves as a bridge before local banking is established, since it can be opened remotely in many cases. Whether Wise fits a particular situation depends on the currencies involved, the need for local bank details, and whether a traditional bank account is also required.

Wise does not replace a local bank account for all purposes. Some transactions—like setting up direct debits for utilities, receiving salary from certain employers, or meeting visa financial requirements—may require a traditional bank account. For more on how different banking tools fit together, see international money transfers.

How people use Wise varies depending on their stage in the relocation process.

Getting started with Wise involves creating an account online or through the mobile app, verifying your identity with a government-issued ID, adding money through bank transfer or card payment, and then using the account for transfers or holding balances. The signup process is generally completed online, with approval times ranging from minutes to several days depending on verification requirements.

Ongoing use happens through a mobile app and web interface. There are no physical branches. Transfers are initiated through the app or website, with tracking available for each transaction. Currency conversions happen within the account—users can convert at the current rate or set up rate alerts.

Costs include percentage-based transfer fees that vary by currency pair (shown before confirming), the mid-market exchange rate without markup, and potential fees for card usage and ATM withdrawals beyond free limits. There is typically no monthly fee for the standard personal account. Current pricing is available on the Wise website.

People use Wise for various situations that involve moving or holding money across currencies.

Wise works well for transferring money between currencies with clear pricing, holding multiple currencies without separate accounts, receiving international payments when local details simplify the process, and managing money digitally.

Wise may not fit situations requiring a traditional bank account for regulatory reasons (some visas, mortgages, certain employers), depositing cash (no physical branches), services requiring a recognized domestic institution, or countries where Wise has limited features.

Wise connects to cost of living through currency conversion—how and when you convert money affects your effective spending power. For people whose income and expenses are in different currencies, the exchange rate and timing of conversions directly impacts their budget.

For visa purposes, Wise account statements may or may not be accepted as proof of funds depending on the consulate and visa type. Some immigration authorities prefer traditional bank statements. Verify acceptance before relying on Wise for visa documentation.

Wise requires valid ID and sometimes proof of address. It unlocks a way to receive and send money internationally before local banking is established. It interacts with local bank accounts, employers and clients who pay internationally, and recurring payments in foreign currencies.

Before relying on Wise for your situation, verify directly with the provider: availability for your country of residence, which currency account details are available in your region, current fees for your currency pairs, ATM withdrawal limits and fees, whether your intended recipients can receive transfers to Wise details, and processing times for your common routes.