Wise, formery Transferwise – how it works?

Transferwise puzzleWise is a revolutionary money transfer service that’s changes the way how we think about fund transfers. You may have heard about it as TransferWise as they changed their name to wise in April 2021. Unlikely banks and typical payment systems they transfer money between people rather than countries. It may sound complicated from the beginning but the idea under the hood is very simple.


The remarkable thing is that all people who take part are helping each other to make their payments happen.

Register and calculate your first payment

The registration is very quick and simple process. You can even register with your existing Google email account that will be super fast.

Now you can login to the website, specify the amount and currency you like to send and the currency you like to get. The system will immediately calculate the amount to be received including the service fee. Please note the amount is estimated and can vary depending on currency exchange rate.

Why conversion rate is estimated for some destinations?

Remember transfers are made between people those payments are not processed immediately. System is looking for a match for your payment and makes the conversion only once the match is found. Because exchange rates are volatile it can be different from the one you seen once you submitted your payment for some less popular destinations. In order to protect your payment Wise gives you an option to cancel payment in case of unexpected spikes of exchange rate. The default value is 3% threshold but it can be modified. Good news are Wise will fix the exchange rate for the most popular destinations and you won’t need to worry about it.

Place the order and upload funds

Once you confirm your order you’ll need to provide recipients banking details similar to bank transfer. You can also specify payment reference because recipient will see Wise as sender of the payment. However your initials will be provided in reference even if you keep it blank.

Once you complete this small form you will be asked to upload funds to the specific Wise bank account. This account will be same currency and bank transfer will cost you no extra money. Optionally you can use a credit card as alternative way for uploading money.

For regular payments you can save your recipient details and speed up your further transfers. I would also recommend adding Wise bank account to the list of habitual payees in your internet bank. They keep using same details including your unique reference ID for each further payment.

Wise matches and converts your payment

Once money arrived to Wise bank account the system starts looking for other people who need to do the opposite transfer. Usually several persons are involved in this process and it mostly depends on how much money you transfer. This process is transparent and you have nothing to worry about. In the result your transfer is done making several individual conversions using effective market exchange rate that can be different. In other words different parts of the transfer can be converted using different exchange rates. Normally it takes a day or two to process conversions. For big amounts it could take even more as more matches require to be found.

Money reach the destination

Once all conversions are completed funds are sent to recipient’s bank account. Usually money arrive in several hours after the moment they where sent. That’s pretty much all.

This is an original video from transferwise.com

14 thoughts on “Wise, formery Transferwise – how it works?

  1. After I load my funds into my Transferwise account, the funds are sent to the bank account listed. My last transaction took 3 days to process to the selected bank account. What do I need to do to get my transfer to the selected bank account quicker then 3 days?

    1. It mostly depends on a currency pair. Transfers to less popular destinations can be slower. What you can try to improve the speed is to pay with a debit card.

  2. I have some questions before I can register.i am receiving money from France and I live in the us,The person who send me this money wants me to send a swift and an iban code. Will not receive this money if I do not have the codes

  3. Just wondering my transfers are so quick usually in minutes.that I think it must be automatic by machine is this correct.

  4. (1) Is the transfer considered as Wire or ACH into a US bank or credit union? Just trying to see if there is a fee at the receiver side. (2) Is there a benefit for the recipient to have a TransferWise account whether linked to or not linked to the recipient’s bank account? If the money is sent to the recipient’s TransferWise Account with a bank linked, what needs to happen for the money to be transferred to the bank account, and any fees involved with that by you? Thank you.

    1. It doesn’t really meter how Wise will move the money (Wire, ACH or other) as they will do it from one of their business accounts. All fees should be visible at the moment you setting up a transaction. Conditions are the same regardless the recipient has or not a Wise account.

  5. I have used TransferWise in the past and it was a different process using it today. This time I was directed to manually go online to my Wells Fargo online account and request wire transfer. My bank charged me a fee to do this. Could it have been sent by linking the two banks together without a fee?

    1. You did something wrong, Wise should give you a target bank account that is local to your bank and should involve no any fee.

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