Wise (Formerly TransferWise) Alternatives: The Complete Rundown

Let’s start first by saying there is no Wise free alternative! Any money transfer firm that advertises ‘0% commission’ is likely hiding behind large FX spreads and perhaps even significant payment fees. It’s important to learn the FX lingo, and how online international money transfer works to know what is and isn’t free.

If you’re a private client then the majority of money transfer companies offer free international payments. That is, the bank charges the money transfer firm to make a payment, but the money transfer firm doesn’t pass this payment fee onto you as the client. This is because money transfer companies make money in the FX spread and private clients generally make significantly fewer payments than a business. The FX firm doesn’t mind absorbing these payment costs for private clients and makes enough profit through the FX spread in return.

You will never find a truly Wise free alternative. There are significant costs involved in facilitating international payments and firms simply wouldn’t be able to operate on a completely free basis. As for Wise.com cheaper alternatives? We think WorldFirst pips Wise on cost and offers the best spreads as standard. WorldFirst FX spreads range from 0.15% – 0.5%, depending on the transfer volume, when Wise spreads work out at around 0.5% across the board, plus a small payment fee. If you are transferring a large sum of $500,000 AUD upwards then it would certainly be worth speaking to some of the other money transfer companies we’ve mentioned above (such as Currencies Direct and TorFX) as the chances are you’ll be able to negotiate a tight spread. For large payments, you can definitely find cheaper Wise alternatives.

Verdict

Wise Cheaper Alternative for Small Sums – WorldFirst

Wise Cheaper Alternative for Large Sums – Currencies Direct

If you’re a business that makes payments of over £1 million then you simply can’t use Wise. The maximum payment limit is around 1 million for all of the major currencies – GBP, EUR & USD.

If you’re a private client then the majority of money transfer companies offer free international payments. That is, the bank charges the money transfer firm to make a payment, but the money transfer firm doesn’t pass this payment fee onto you as the client. This is because money transfer companies make money in the FX spread and private clients generally make significantly fewer payments than a business. The FX firm doesn’t mind absorbing these payment costs for private clients and makes enough profit through the FX spread in return.

For firms seeking FX forwards, limit orders and even FX options they’d be better off looking at Wise business alternatives. There are a lot of good money transfer companies out there. Moneycorp and Currencies Direct are both a very good Wise alternative for business. A somewhat different proposition to Wise, they ensure customers have a smooth online experience, but focus much more heavily on the account management side. Businesses will be assigned their own currency dealer who can book trades over the phone and meet face-to-face to discuss a tailored currency hedging strategy specific to your business. *Moneycorp doesn’t accept Australian clients anymore but still transacts with AUD for clients from other countries.

As the only payments you can make through the Wise platform are instantaneous spot FX trades, it can leave you vulnerable to movements in the FX market. You have to agree to the live exchange rate at the time you make the payment. The most basic hedging strategy, which offers a complete hedge to the effects of the currency market, is a forward contract. A forward contract allows the buyer to agree to an FX trade in the future at today’s exchange rate. All of the alternatives to Wise for business accounts we mention in this article offer forward contracts as well as a number of other hedging tools.

Verdict

Best Wise Business Alternative – Currencies Direct

It’s fair to say that most Wise money transfer customers love the Wise Borderless Account. Travellers, expats and freelancers all benefit from the low fees and simple online solution. It allows people to effortlessly spend in any currency across the globe, receive money for free and hold balances in those currencies. You can make online money transfers too – on average 8x cheaper than leading UK banks.

As it stands, there are over £2 billion in deposits held in Wise Borderless Accounts. But despite its popularity, there are some drawbacks and some very valid Wise borderless alternatives. For users seeking true in-country local bank accounts then the Borderless Account doesn’t have you completely covered. The major currency accounts GBP, EUR and USD are all held in their respective countries, but not all of the 50 currency accounts you can open are. In fact, most of them operate in London – so can prove problematic for customers looking to make a local transfer to your bank account.

Possibly the best of the Wise borderless alternatives is WorldFirst. The World Account product allows you to hold balances in a small number of currencies – 10 to be precise – but all of the accounts are truly in-country to their respective currency. Allowing for much easier domestic transfers when making and receiving payments in the same currency. What’s more, all World Accounts are underpinned by Tier 1 and Tier 2 banks – the same can’t be said for Wise who partner with smaller banks to roll their product out. Wise also set maximum payment limits, which WorldFirst don’t. All of these factors generally mean businesses prefer WorldFirst and they lead the pack for Wise borderless account alternatives.

Verdict

Best Alternatives to Wise Borderless Account – WorldFirst