It’s easier than ever before for businesses to operate in multiple countries. Many of the obstacles faced in years gone by have been overcome with the rise of the internet and technology.
However, many traditional financial institutions have been slow to respond to this change. As such, the fees for doing business overseas are often prohibitively high.
That’s where challenger brands like TransferWise come in, offering competitive rates for international businesses. In our TransferWise Business review, we take a look at everything you need to know.
Quick Look – Pros & Cons
As always, let’s kick things off with a quick overview of what we like and dislike about TransferWise Business. As with just about every similar service, there are positives and negatives when it comes to choosing this transfer specialist:
| Pros | Cons |
|---|---|
| ✔️ Make and receive international payments in over 40 currencies | ❌ Uses mid-market rate, meaning you can find cheaper rates elsewhere |
| ✔️ Transfer fees up to 19 times cheaper than competitors | ❌ Can only transfer to a bank account, no option for cash pickups |
| ✔️ A range of transfer options available | ❌ Card currency conversions can be pricey |
| ✔️ Account is free to set up and allows access to bank details |
So, a reasonably balanced set of pros and cons, as you might expect. We’ll cover these in more detail as we explore our full Transfer Wise Business Review.
What is TransferWise for Business?
TransferWise is an online money transfer service founded in London in 2011. The company was created with the aim of ending the ‘pain of international money transfer’. In 2012, the firm received approval from the UK financial regulator FCA, allowing them to provide such services for all kinds of customers.
Over the years, TransferWise has grown to be one of the biggest money transfer services in the world, with its customers sending over £1 billion each month. In 2017, the firm announced their Borderless business accounts, which gives freelancers and organisations an account and multi-currency card.
How to get started with TransferWise Business
Getting started with a new business account can sometimes be tricky. Thankfully, challenger brands such as TransferWise have been perfecting the art of signing up with ease. The process for opening a TransferWise Business account is pretty straightforward, although there are a few things to bear in mind. We’ve outlined all you need to know:
- Create a free account on the TransferWise site.
- Provide details about your business, such as your registration number, address, industry, and social presence. You’ll also need to give the personal details of all of the business owners and directors.
- As the person setting up the account, you’ll be the admin. As such, you’ll have to give your personal details and your role in the business. For those who aren’t directors or owners, you may need more info.
- If you want to get full bank details, you’ll need to top up your account with a cash transfer to access them.
- Once you’ve sent everything off, it usually takes TransferWise around 2-3 working days to verify and approve your account. When they’ve done so, you’ll receive an email notification.
As you can see, it’s pretty straightforward. However, for some, it can be frustrating to wait for your account to be approved, particularly if you need a quick transfer.
How does TransferWise Business work?
TransferWise isn’t a bank, although it does give you access to things like an account and a business Mastercard. The fact they aren’t a bank actually makes some things slightly easier (and cheaper) than high street organisations. In particular, international transactions are often more transparent with TransferWise.
One of the key benefits of using TransferWise is that they set their exchange rate for two days. So, you won’t lose out if the rate changes before your transaction completes.
Traditional banks have a wide variety of established requirements when it comes to sending and receiving money from overseas. As such, exchange rates, services charges, and additional fees all mount up. TransferWise takes a different approach.
One of the key benefits of using TransferWise is that they set their exchange rate for two days. So, you won’t lose out if the rate changes before your transaction completes. Similarly, when you transfer money with the service, TransferWise uses its own accounts to settle the payment.
When you send money, you get the actual exchange rate. This is because money is sent into TransferWise accounts in the origin country, and out of the TransferWise accounts in the destination country. The money never crosses borders, so it’s faster and cheaper to transfer money.
What features does TransferWise Business have?
Of course, there’s more to TransferWise Business than just international money transfers. The company has designed a product that can help with many different aspects when it comes to your finances. Ultimately, it’s about ‘business without borders’ as the company’s website states.
So what other features does the account offer? Below, we’ve picked out some of the most notable benefits that come with choosing a TransferWise Business account:
- Get your own banks details, including a UK account number and sort code, a European IBAN, and a US routing number. This gives you the flexibility to move and receive money without hassle.
- A business Mastercard. When you’re travelling overseas, this card gives you access to 150 currencies with no hidden fees. You can either access funds in the local currency (if you have them) or receive an automatic conversion from others.
- Tool integration. For those who use accounting software such as Xero and QuickBooks, you can easily sync your activity from TransferWise Business.
- Batch payments. If you’re making multiple payments or settling payroll, you can easily do so in just a few clicks.
- Connect with the TransferWise API. This helps you integrate TransferWise with your existing business tools.
- Third-party payments. You can make payments on behalf of your clients, provided you have a money transmitter licence.
As you can see, that’s a fairly impressive set of features, particularly when you consider that the account is free to set up. However, there are some additional costs to consider.
What are the fees for using TransferWise Business?
One of the main considerations for an account like this is how much it costs to use. As we’ve mentioned, the account itself is free to set up. However, there are plenty of additional fees introduced for using the various functions. That being said, TransferWise aims to be as transparent as possible.
To make things clearer, we’ve highlighted some of the key information concerning the fees for using TransferWise Business:
- Get bank details for receiving currencies. This costs £16, although it’s a one-off fee and one that’s worth paying.
- Sending money. There is a fixed fee of 65p per transfer. However, this varies depending on the currency.
- Currency conversion using your card. The fee on this action ranges from 0.33% to 3.54% of the transaction, depending on the currency.
- ATM withdrawals. The first £200 per month is free, with a 2% charge on anything above that.
Those are the major fees to consider, which on the whole aren’t terrible. You’ll get a mid-market rate on your transfers, which is also quite reasonable.
As an example, at the time of writing, adding €1,000 when paying in GBP would incur a fee of £3.32. Similarly, receiving a €2,000 payment in GBP would be free. Compare this to the cost of PayPal, for example, which would cost around £66.
Who is TransferWise Business for?
The TransferWise Business account is one that could benefit all kinds of businesses. It works well whether you’re a freelancer who travels a lot or the owner of a larger organisation with clients overseas.
The main draw of this business account is how quick, easy, and affordable it is to move money around. By taking traditional banks out of the equation, TransferWise can offer businesses some of the best rates out there when it comes to moving money across international borders.
Although many companies could make use of this account, those who deal mainly in cash might not find it so appealing. TransferWise doesn’t accept cash or cheque payments, and the 2% fee on withdrawals above £200 could soon mount up.
What are the drawbacks of using TransferWise Business?
As with many of the accounts that we review, there are some downsides to the TransferWise Business account. The extent to which these will impact you depends on your business and what you’ll use the account for, however.
Perhaps the most significant downside is that there are some fees which can creep up. For example, if you’re making regular payments in other currencies, you’ll have to pay the small fee each time you do so. Similarly, if you’re withdrawing in high volumes, the cost could soon make it a less than viable option.
Although you’ll get a good rate on currency conversions, it will never be the best rate. What’s more, if you’re making payments on your card in other currencies, you could face fees of over 3% of the transaction. Again, these may or may not impact your business.
How safe is TransferWise Business?
Overall, it’s very safe to use TransferWise for your business. Despite not being a bank, they are regulated in the same way. This means that they’re under the watchful eye of the Financial Conduct Authority, which protects against fraud and money laundering. Overseas, they’re also regulated by a host of other local authorities.
The website and app use HTTPS encryption, as well as two-factor authentication. So, you can rest assured that your transactions and details are always secure. The money in your accounts is held in separate, protected accounts with firms such as Morgan Chase, Deutsche Bank, and Barclays. This means that, if TransferWise goes under, your money is safe.
TransferWise Business Verdict
Ultimately, we’re impressed with the TransferWise Business account. Although it’s by no means a full replacement for your main business bank, it’s the ideal tool for dealing with international payments. Compared to other services such as PayPal, it’s often a much more affordable way of transferring and converting money.
The business Mastercard gives access to over 150 different currencies, meaning you can make payments no matter where you are in the world. Similarly, you can get bank account details for a host of different currencies, reducing your fees overall.
Despite things like the lack of cash payments and the fees that can creep up in some instances, this is an account that’s suitable for all businesses, from freelancers to larger organisations.
