How Wise differs from a UK bank

If you’re shopping around for a new way to manage your money, you’re likely to have come across Wise.

Wise is a UK-based money services company, which offers multi-currency accounts for personal and business customers. It also specialises in international money transfers, as well as having debit cards that can be used all over the world.

But is Wise a bank account, or can it be used like one? Read on to find out how Wise differs from UK banks, and the pros, cons and features of Wise accounts.

Is Wise a bank?

Wise is not a bank, it’s an electronic money services provider regulated by the Financial Conduct Authority (FCA) in the UK.

As such, it offers online money accounts, but these aren’t bank accounts and you can’t use a Wise account as a bank account.

However, Wise does have some similar features to UK banks. We’ll cover these, along with the differences, next.

How Wise differs from a bank

The main way that Wise is different from a bank is that it doesn’t have a UK banking licence.

It also doesn’t offer the Financial Services Compensation Scheme (FSCS) protection for your money in the way that banks do. Licensed UK banks are required to offer this protection as they lend out customer money.

Wise doesn’t lend out your money, so instead uses a measure known as safeguarding. This is where customer money is kept separately from business funds, in an account held with a trusted UK banking institution.

📚How Wise keeps your money safe

Wise also takes security measures seriously, with a dedicated fraud team, two-factor authentication and regular audits to name a few.

Another key difference is that banks also offer a broader range of services, such as credit cards, loans and overdrafts. Wise instead focuses on international money services such as its multi-currency account. Though, unlike with a bank account, you can’t pay cash into your Wise account.

Wise accounts do have some similar features to bank accounts, such as:

• Sending and receiving money
• Holding a balance
• Spending with a linked debit card.

📚How Wise works

Pros and cons of a Wise account in the UK

If you’re comparing what’s out there, it can be useful to know a little about the pros and cons of opening a Wise account in the UK.

Capital at risk. Growth not guaranteed. Wise Assets UK Ltd is authorised and regulated by the Financial Conduct Authority with registration number 839689. When facilitating access to Wise investment products, Wise Payments Ltd acts as an Introducer Appointed Representative of Wise Assets UK Ltd. Please be aware that we do not offer investment advice, and you may be liable for taxes on any earnings. If you’re uncertain, we urge you to seek professional advice. To find out more about the Funds, visit our website.

Is a Wise account or card right for you?

Wise is ideal for people who travel a lot, or who work abroad regularly. It’s also incredibly useful for UK expats and retirees living abroad, who need to manage their money between countries.

You’ll also find Wise a great option if you’re a digital nomad, or a freelancer or business with global clients.

And if you have property, interests or family abroad, you’ll also benefit from the low fees* and great exchange rates offered by Wise. If you want to exchange money at the best possible rates, you can sign up to Wise rate alerts and do the conversion at the perfect time.

Lastly, you might be interested in Wise if you want to invest - the Wise Interest feature can help you earn returns on your money (capital at risk).

Capital at risk. Growth not guaranteed. Wise Assets UK Ltd is authorised and regulated by the Financial Conduct Authority with registration number 839689. When facilitating access to Wise investment products, Wise Payments Ltd acts as an Introducer Appointed Representative of Wise Assets UK Ltd. Please be aware that we do not offer investment advice, and you may be liable for taxes on any earnings. If you’re uncertain, we urge you to seek professional advice. To find out more about the Funds, visit our website.

Wise features

So, what do you get with a Wise account? Here’s a roundup of all the key features you need to know about:

• Hold, convert, send and receive 40+ currencies
• Convenient, secure international transfers for low fees*
• Dedicated service for sending large amounts
• Mid-market exchange rates (with no mark-up) on all currency conversions
• Get account details for 8+ currencies to receive fee-free global payments
• Spend like a local in 150+ currencies with the Wise card
• Withdraw up to £200/month at overseas ATMs twice fee-free (operator fees may apply)
• Earn returns on balances with Wise Interest (capital at risk)
• Dedicated services for businesses with a Wise Business account
• Handy Wise app for managing your money on the move.

Capital at risk. Growth not guaranteed. Wise Assets UK Ltd is authorised and regulated by the Financial Conduct Authority with registration number 839689. When facilitating access to Wise investment products, Wise Payments Ltd acts as an Introducer Appointed Representative of Wise Assets UK Ltd. Please be aware that we do not offer investment advice, and you may be liable for taxes on any earnings. If you’re uncertain, we urge you to seek professional advice. To find out more about the Funds, visit our website.

Hopefully after reading this, you’ll have a better idea of how Wise differs from a bank. Plus, the main features and benefits its multi currency accounts and cards can offer.