Wise money transfer guide: How it works, fees and how to use for businesses in Singapore

If you’ve searched for an alternative way to send money overseas, you may have already heard of Wise (formerly known as TransferWise). This fintech firm revolutionised global money transfers by offering low-cost international payments for individuals and businesses. 

Read more: What are Digital Banks in Singapore

In this article, we'll show you how to use Wise money transfers for businesses. We’ll also introduce Airwallex as a Wise alternative in Singapore. Airwallex is a fintech platform specifically engineered for businesses who need an all-in-one financial solution for their global operations.  

Read more: What Is a Telegraphic Transfer (TT) and How It Works

Who uses Wise for money transfers? Understanding the benefits

Wise caters to individuals or businesses who need to send or receive cross-border transfers. Cost savings are the main benefit, as Wise uses mid-market exchange rates and charges a 0.43% foreign exchange markup. Additionally, transactions are processed quickly, often within the same day or the next, ensuring that individuals receive their funds promptly. 

These types of users can reap the benefits of using Wise:

• Remote workers. Professionals and freelancers working for overseas clients use Wise to receive foreign currency payments without losing money on conversion fees.

• Travellers. People travelling for leisure use Wise to exchange currencies at favourable rates. The Wise debit card also allows individuals to withdraw cash or make contactless payments in over 170 countries.

• International students. Students studying abroad use Wise to convert currencies for their living expenses.

• Online shoppers. People who shop from international marketplaces like Amazon or Temu can avoid high conversion fees through Wise. 

Wise is also used by a wide range of businesses. Its exchange rates and low fees allow these businesses to maximise their international earnings, and receive payments in multiple currencies. 

• Startups. Lean, young companies use Wise Business to move capital or pay global contractors. 

• Small and medium enterprises (SMEs). Local SMEs who work with overseas suppliers use Wise to send payments without hefty bank fees.   

• eCommerce businesses. Online retailers use Wise to pay suppliers, receive payments in different currencies and convert earnings to SGD at a lower cost.

• Service providers. Businesses offering digital services to international clients rely on Wise to send invoices, receive payments, and repatriate their earnings to Singapore.

How to set up your Wise account and send money abroad

The Wise account setup process is straightforward, provided you have your documents ready. Follow these steps to open your account:

How to register a Wise Business account  

Opening a Wise Business account follows a similar process, with a few notable differences:

Step 1: Create a Wise personal account

You need a personal account to open a Wise Business account. First, register online by downloading the Wise app or visiting the website. Tap on Register, and sign up with your email address, Facebook, Google, or Apple ID.

Next, you must verify your account. You can use Singpass to provide your details, or submit soft copies of the following documents:

• NRIC, employment pass, or work pass (front and back)

• Proof of address that shows your full name and a clear logo of the issuer. This can be bank statements, IRAS bill, utility bills, vehicle registration, or driver’s licence showing your address.

Step 2: Provide details about your business

You need to verify your business before you can start transacting with Wise. Get ready with the following information:

• Company name and UEN registration number

• Company website

• Description of your business and how you plan to use Wise

Step 3: Provide identifying documents for your shareholders or directors

To comply with Know-Your-Customer (KYC) and Anti-Money Laundering (AML) regulations, Wise needs information about all shareholders or directors that own over 25% of the business:

• Full name, date of birth, country of residence

• Government IDs

• If the shareholder is another business, provide company registration documents that show all shareholders of the enterprise

Businesses incorporated outside Singapore need to submit these additional documents:

• An ID of the highest-ranking director

• A company registry document that shows details of all shareholders of the company 

Step 4: Pay the account opening fee A one-time fee of SGD 54 will be charged when you open a Business account.  

Step 5: Send money

Once your account is verified, you can top up your Wise account through your business bank account. Note that your bank account must have the same name as the business you registered with Wise.

To send money with Wise, tap “Send”. Enter the amount, currency, and your recipient’s international bank details. You’ll see the fees and exchange rate before sending.  

What Are Wise’s Fees and Exchange Rates?

Wise offers a straightforward and competitive fee structure for businesses. Fees vary depending on the amount, currency, payment method, and country you can send to. You’ll see how much fees will cost after entering the transfer details

Wise money transfer fees 

Businesses are charged a variable fee for sending payments to international bank accounts. According to Wise’s website, this fee is a percentage of the amount you’re sending and starts at 0.43%. It varies according to the amount and currency and gets lower when you send over GBP 100,000 (or its equivalent in other currencies) during a calendar month. In contrast, Airwallex charges SGD 0 for sending non-wire transfers and has a flat fee for SWIFT transfers, which can be more cost-effective for businesses that send large volumes.

Receiving money via non-wire methods is free for 9 currencies, because of Wise’s partnership with local payment networks. However, there’s a standard fee for receiving funds in other currencies, especially if it’s done through telegraphic transfer. Wise also charges a fixed fee for receiving USD and CAD wire payments.

How does Wise calculate exchange rates?

Wise is known for offering cost-effective exchange rates, which are calculated using the mid-market rate. This rate is the midpoint between the buy and sell prices of two currencies on the global market. The exchange rate you see on independent sources like Google or Reuters is based on the mid-market rate.

Unlike traditional banks, which often add a markup to the exchange rate for profit, Wise provides this mid-market rate directly to its customers. All currency conversions through Wise display the exchange rate and fees, ensuring you get the best possible deal without any hidden costs. You can see Wise’s mid-market rate on the app or by using their exchange rate tool.

Airwallex also offers a friendly interbank exchange rate, which is just like the mid-market rate. We calculate the interbank rate based on live exchange rates from our banking partners and market data sources. To verify the fees and amount converted, check the dashboard before making the conversion. Airwallex always puts all fees on the dashboard, so you can see how much each conversion costs. 

When does the beneficiary receive the money?

Wise is known for fast transfer speeds, with most transfers being completed within 1-3 business days. However, the speed can vary depending on several factors:

• The sender and recipient’s countries. Differences in banking regulations can affect transfer times.

• Transfer method. Payments made through non-wire methods are instant, but sending money via SWIFT can take several days.

• When the payment is initiated. Transfers initiated outside banking hours may take longer.

• Additional checks. Wise may need to verify your identity, address, or the source of your funds, which can take up to 10 days.

Airwallex can complete cross-border payments as quickly as 1 business day through local transfer methods and up to 3 days or more for sending money via SWIFT. For funds that travel through Airwallex’s proprietary local payment network, you can send money like a local, which means faster and more affordable transfers.

Where can you send money with Wise? 

Most recipients receiving money from TransferWise Singapore use their bank account to accept the funds.

Through this method, the sender initiates a transfer by entering the recipient’s bank details. Wise then converts the funds at the mid-market exchange rate and deposits the money directly into the beneficiary's bank account.  

Recipients can also accept funds through personal or business Wise accounts. When funds are sent to a Wise account, the recipient can choose to keep the money in their Wise account or convert it to another currency. They can also use their Wise debit card to spend money or withdraw cash from ATMs. 

Why choose Wise for your international money transfers? 

Wise remains a compelling choice for both businesses and individuals who want to make overseas money transfers without the hidden charges imposed by banks. 

However, other fintech payment services may be better for business owners. Let’s take a look at some alternatives to Wise in Singapore and who might benefit from them.

Airwallex vs Wise for Singapore businesses

Many businesses in Singapore turn to Wise and Airwallex for cross-border payments. Both fintech firms offer transparent international transaction fees and mid-market exchange rates, resulting in significant cost savings.  Unlike corporate banks, Wise and Airwallex can complete transfers as quickly as 1 business day. They even offer time-saving features like accounting integrations, which automate many manual processes.

Airwallex offers more features that may be suitable for businesses, such as payment gateway, currency risk management, and free multi-currency Visa cards with 1% unlimited cashback. Airwallex also has a dedicated local customer support team based in Singapore that can support businesses with cross-border-related queries.

Sources: Airwallex, Wise as of 20 March 2024

If you need a simple way to send and receive funds overseas, Wise can be a good choice. But if you need a full-featured financial platform and dedicated support for your growing global business, Airwallex could be the better option for you.

Maximizing your Wise experience

Access to low-cost foreign exchange and international payments is a must for global businesses. When you can’t get these from banks, fintech services like Wise offer a cost-effective alternative. Having a multi-currency account with friendly exchange rates makes it easier to send payments or get paid, without losing money on hidden fees.

In contrast, Airwallex caters exclusively to businesses, with comprehensive financial services for startups, SMEs, and other global companies. On top of fast, low-cost international transfers, the Airwallex Business Account streamlines financial processes like bill payments, expense management, and collecting payments via payment links and payment gateways. By streamlining these processes at competitive rates, Airwallex empowers Singapore businesses as they expand regionally and beyond. Discover these benefits for yourself and create a free Airwallex account today.

Frequently asked questions

1. Can I use Wise for freelance or contractor payments abroad? How does it compare to Airwallex in this scenario?

Businesses can use Wise to pay freelancers or contractors based abroad. The Wise Business account has a batch payment feature that lets users initiate multiple payments at once. Likewise, Airwallex also makes it easy for businesses to pay team members overseas with high-speed batch transfers and bill payments. However, you need to be a registered business to use Airwallex.

2. Can Wise transfers be cancelled or modified after they've been initiated?

Once a Wise transfer is marked completed on the website, it cannot be cancelled or modified. Wise considers all completed transfers as final, and they are unable to reverse or recall payments.  

The platform is also unable to mediate disputes between senders and recipients. Ensure that you know and trust the business you’re sending money to, and double check their details before initiating a transfer. 

3. How does Wise handle currency fluctuations during the transfer process?

Wise secures the mid-market exchange rate the moment a customer initiates the transfer. When a certain currency is volatile, such as during times of political uncertainty, Wise puts a limit to how much a customer can send or receive in that currency. This minimises the impact of unexpected rate changes to customers and their own operations.

4. Are there any limitations on the amount of money I can send or receive with Wise?

Wise Business account users have transfer limits, but these limits vary depending on the currency and where the funds are sent from.

5. Does Wise integrate with any business accounting software?

Wise Business Accounts can integrate with Xero, Quickbooks, and other accounting software.

6. Are there any additional services or features offered by Airwallex that are not available with Wise?

Airwallex offers unique business features that you can’t find in Wise and other fintech firms:

• More local currency accounts. According to their website as of March 2024, Wise offers 9 local currency accounts. With Airwallex, businesses can create 20+ currency accounts with local bank details. This makes it easy for firms to receive funds from markets like China and Hong Kong.

• No account opening fees. Wise account setup requires a SGD 54 fee, while an Airwallex Business Account is free to create.

• Transfer fees. Wise’s transfer fees are variable and start at 0.43%, but Airwallex SWIFT transfer fees are fixed and free if you use local transfer methods.

• 1% cashback on Borderless Card transactions. There’s no limit to the cashback earned and no restrictions.

• Multi-currency payment gateway. Receive eCommerce payments globally and avoid unnecessary conversion fees through like-for-like settlement, the ability to collect and settle funds in the same currency.

• Embedded finance. Airwallex offers APIs that let you build global payments and banking services within your platform.

• Local customer support team. Airwallex business customers in Singapore benefit from a local customer support team.

Sources:

https://wise.com/help/articles/2963613/getting-verified-in-singapore

https://wise.com/sg/pricing/business

https://wise.com/sg/pricing/business/send-money

https://wise.com/help/articles/2977942/how-much-does-it-cost-to-send-large-transfers?origin=search-hat

 https://www.airwallex.com/sg/pricing#Payments

 https://wise.com/sg/mid-market-rate

 https://wise.com/tools/exchange-rate-alerts/

 https://wise.com/help/articles/2524078/how-long-does-a-transfer-take

https://wise.com/help/articles/2977963/how-long-will-additional-checks-on-my-transfer-take?id=2977963&slug=how-long-will-extra-checks-on-my-transfer-take

***Note: This publication does not constitute legal, tax, or professional advice from Airwallex nor substitute seeking such advice, and makes no express or implied representations/warranties/guarantees regarding content accuracy, completeness, or currency.