Wise Has A Better Plan For Your Wire Transfers

It was here that Wise’s mission; money without borders - instant, convenient, transparent and eventually free, was born.

Wise Has A Better Plan For Your Wire Transfers
Lim Paik Wan, Malaysia Country Manager, Wise - Pix Provided

In this interview with Lim Paik Wan, Malaysia Country Manager, Wise, we learn more about the global technology company that allows you to move your money around the world in a modern way.

Here, we spoke mainly about the rise in multi-currency accounts, the hidden fees when transferring money online, how Wise is growing in Malaysia and how it is helping locals take control of the ways they manage their Wire transfers.

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Responding to Business News she says the company Co-founded by Kristo Käärmann and Taavet Hinrikus, was launched in 2011 under its original name TransferWise when the founders realised how much money it costs to transfer money between the UK and Estonia.

"It was here that Wise’s mission; money without borders - instant, convenient, transparent and eventually free, was born.

"To answer your question, multi-currency accounts like the Wise account is game-changing - it is the most universal account allowing people to send, spend and receive money like a local anywhere they go, making it easier than ever to live a global lifestyle."

For many people, such a lifestyle seem out of reach because there are a lot of questions on the costs and security.

For Wise, it offers instant, affordable money transfers at the mid-market rate to 80 countries and this should make it a platform that most people would want to use.

More on the Wise Account

Besides the transfer availability to that many countries, it also offers the ability to hold more than 50 currencies in a multi-currency account and an accompanying debit card to spend in more than 150 countries. That is a lot of pluses.

Paik Wan says another exciting feature of the Wise account is the ability to get bank details for the UK, Eurozone, New Zealand, Singapore, The US, Canada and more.

"With just a few clicks, and without needing a local address in any of those countries, Malaysians can start receiving payments like a local from others in those countries.

"The main benefit of having a Wise account over a traditional bank account is being able to transact without foreign transaction fees or unfair exchange rates. With Wise, users always get the real, mid-market exchange rate and low fees across all our features.

"When you look at the current offerings in Malaysia, it’s often costly, difficult, slow, and non-transparent whenever you need to transact in another currency. This is where Wise stands out as an account that works easily for anyone that needs to transact in multiple currencies," she says.

Wise lets you manage your life between countries and currencies - Photo by Austin Distel / Unsplash

She adds that whether you work or have family abroad, pay for overseas mortgages, shop online at international stores, a traveller, an international student — Wise lets you manage your life between countries and currencies with financial ease in a low cost, convenient manner.

How do consumers know when there is a hidden fee?

People are often unaware of the hidden charges associated with foreign currency transactions and could end up paying more than they anticipated.

In fact, this happened exactly with our founders Kristo and Taavet when they had to move money across borders and realised how expensive and non-transparent the fees and exchange rates were.

Consumers usually think they’re getting a better deal than they actually are, or they don’t realise how much costs they pay for exchange rate mark-ups. With foreign currency transactions, there are typically two costs:

  1. The upfront fee (the advertised cost). Fees vary but can often be portrayed as low transaction fee or even “free international transfers”. But be aware that the upfront fee may not represent the total cost of the transfer.
  2. The exchange rate (the hidden cost). When you look up an exchange rate on Google, you are shown one figure: the mid-market exchange rate. This is the mid-point between the “buy” and “sell” rates on the global currency markets. The mid-market rate is considered the most fair and the “real” exchange rate and it’s the same one you will find on finance authorities like Reuters or Google.

The extra cost

"Banks and other service providers are not obligated to use the mid-market exchange rate to convert your money — in fact, many usually don’t. Often, you will find that an undisclosed markup has been added to the exchange rate. The difference between the rates result in a hidden fee, costing people extra unknowingly when they send money," she says.

Up to £150 billion[1] is lost globally in hidden fees on foreign currency transfers yearly, which is an enormous problem and this is primarily due to the low awareness about costs associated with foreign currency transactions (transaction fee and marked up exchange rate). In Malaysia, our study revealed that Malaysians had spent RM 10.5 billion in total card fees[2] when shopping overseas from 2015 to 2020 and RM 1.5 billion[3] was paid in transaction fees and hidden exchange rate markups yearly when shopping overseas.

Wise doesn’t markup the exchange rate. We use the mid-market rate which anyone can look up on Google and Reuters, always show our fees upfront and only charge customers a low, upfront fee.

What should they do to avoid such fees?

My top tip to anyone making a transaction or transfer in another currency is to look closely at the exchange rate offered and review the fees involved, including the fine print.

Watch out for too good to be true deals like zero fees! My recommendation is to pick a provider that is transparent about their fees and exchange rate used. It's worth noting that exchanging currency isn’t free, so if a provider claims that they don’t charge a fee, they could potentially be hiding costs elsewhere in their services.

For travellers, make sure you spend in the local currency at your destination. You know when you swipe your debit or credit card abroad or withdraw money from an ATM abroad and the machine asks if you want to pay in ringgit or in the local currency? That’s called Dynamic Currency Conversion or DCC and it’s a major rip-off. It may seem smart and convenient to pay in ringgit — after all, it’s an amount you’re familiar with.

But, in reality, these machines offer worse exchange rates than the average bank and saddles you with hidden fees. So, make sure to always choose to be charged in the local currency when spending in a foreign country; do not let the machine do the conversion.

Is Wise growing in Malaysia?

And in that perspective, we wanted to know how do people get to take control of their finances by using Wise? Is that the reason that Wise is pushing the service in Malaysia?

Paik Wan says Wise’s mission is to build money without borders — instant, convenient, transparent and eventually free. The problem of high fees, hidden exchange rate markups, delays and fine print on cross-currency transactions is universal.

For example, up to £150 billion[4] is lost globally in hidden fees on foreign currency transfers yearly, and in Malaysia, a separate study revealed that Malaysians had spent RM 10.5 billion in total card fees[5] when shopping overseas from 2015 to 2020 and RM 1.5 billion[6] was paid in transaction fees and hidden exchange rate markups yearly when shopping overseas.

"Our focus is on solving this problem for everyone, everywhere, including Malaysians, and generally speaking, reception to Wise in Malaysia has been promising.

"Our customers are anyone who needs to spend, send, receive and manage money in multiple currencies," she says, adding that this is why they often see such customers using Wise:

  1. Expats who live in Malaysia needing to send money back home.
  2. Locals who may have lived overseas previously or have family living abroad, and have a need to send or receive money in multiple currencies quickly and cheaply.
  3. People who often shop from international sites, as well as avid travellers who need a low cost, transparent way to make purchases while abroad.

"Using Wise means you’re getting the fair, mid-market exchange rate, and the fees you pay are extremely cheap. Most of all, we’re transparent about our charges and customers appreciate that," she adds.

"In fact, we even built a comparison table on our home page so consumers can see for themselves how much our service costs compared to other players and choose wisely — if a competitor has a better deal, we don’t hide it. Our approach resonates with customers: 66% of our customers actually come from word of mouth!"

Globally, Wise processes over £9bn in cross-border transactions every month and customers save themselves £1bn a year compared to using a bank. Half of all our international transfers globally are instant (delivered in less than 20 seconds). 13 million people, businesses and even banks use Wise for international payments, but our journey is only just getting started.


[1] An independent report from Edgar, Dunn and Company, with research undertaken in January 2021, shows that over £150 billion is paid in fees to traditional banks each year. These fees are either extracted through an exchange rate mark-up or a rate mark-up plus

additional fee. The same research shows that only 4% of surveyed bank customers understand what they are being charged in these transactions.

[2] These fees include card ownership and miscellaneous fees, transaction fees and exchange rate margin fees.

[3] Yearly average calculated from the total amount on card transaction fees and exchange rate margin fees only on overseas card spend from 2015 to 2020

[4] An independent report from Edgar, Dunn and Company, with research undertaken in January 2021, shows that over £150 billion is paid in fees to traditional banks each year. These fees are either extracted through an exchange rate mark-up or a rate mark-up plus additional fee. The same research shows that only 4% of surveyed bank customers understand what they are being charged in these transactions.

[5] These fees include card ownership and miscellaneous fees, transaction fees and exchange rate margin fees.

[6] Yearly average calculated from the total amount on card transaction fees and exchange rate margin fees only on overseas card spend from 2015 to 2020