How is (Transfer) Wise is slowly winning the product + fintech money wars

Disclaimer: I am not employed nor related to (Transfer) Wise in any way possible.

Let's start with a quick backstory here. I have been using Wise for at least 2–3 years now. As a consumer, I got addicted to the product because of the speed at which they could transfer my money from one country to another with the lowest possible transfer fees possible. It made me dig deep into their product and how the folks behind the app built this fascinating backend infrastructure to enable super-fast money transfer.

The Wise Story

For folks who don't know how TransferWise came into being, Taavet and Kristo were friends who got paid in Euros and Pounds while working for separate companies in London. One had to transfer money to his hometown (Estonia) for paying off the mortgage/loan, but doing so was quite expensive using the conventional method provided by their banks. The other who was earning in Euros needed money in Pounds to pay the bills in London. So, Taavet decided to transfer his Euros to Kristo's Estonia account, and Kristo would transfer the equivalent account to Taavet's performance in London. All of this transfer happened without any makeup fees. Hence, the idea got invested for moving money to their respective countries without sending money from one place to another. 👇 Watch the video below to learn more.

Now that we have established the basics of Wise. Let's explore the three things that I believe the company is doing differently from other Fintech players in the market that are helping them be the leader in this space.

You can learn more about the inner working of Wise here: https://www.moneydashboard.com/blog/how-does-transferwise-wise-work

Low Fees

Wise operates on these three principles to keep themselves accountable for becoming better with the passing year. The fees offered by Wise for transferring large sums of money are already relatively low, but they are aiming to reduce it even further. In addition, they count on people to use their service more often than banks to transfer money, allowing them to reduce the fees for "everyone" even further. Now, every company wants their users to use their product more often than not, but the great thing here is that I see Wise reducing transfer fees between some countries regularly as a consumer.

Please note that Wise is currently being used by 10+ million people and businesses worldwide. To increase usage and reduce transfer fees, they are partnering (and exposing APIs) with other fintech players in the market, including banks, to divert all customer interest to their app.

Transparent Roadmapping

On the 23rd of April, 2021, Wise announced that they would be sharing most of their internal product roadmap to the public so that all users can give feedback and vote on their in-progress roadmap features. Additionally, you can check out Wise's latest mission roadmap on their website.

Most product teams won't be comfortable exposing their internal roadmap plans in a public setting like this. But sticking to the principle, "Radically transparent," Wise enables users to comment, give feedback and get in touch with the product team members directly (in a way). It will also allow Wise to share implementation blockers with their users and, in the process, create a healthy dialogue.

As a product designer, I must confess that I have never seen a startup exposing any part of its roadmap to the public and competitor companies to copy. Most companies would be scared of the criticism it would attract or other players copying their ideas. But fortunately, the team at Wise is looking to revolutionize all their financial life. Customers.

Inflation & Dollar Cost Averaging

When it comes to entering the investment market, I must confess that Wise is late to the party. But given the product that they have delivered so far, I am pretty optimistic about their future wealth generation and investment features.

Transferring money from one geographic location to another is not enough in 2022. While Gen-Z is fast dipping its toes in the investment market, many millennials and older generations still feel safer keeping their hard-earned money in their bank account. Wise understands that when consumers save their money in the banks, they start working for them, not for the consumers. To begin handling people's money as an investment platform, Wise needs to file for various regulatory and compliance licenses before they can help consumers shield their hard-earned money from inflation and start generating a passive stream of income. But with that said, Wise has already begun testing out Beta investment products in the UK market and might be looking to gain licenses in countries where digital penetration is the highest with significant financial power (and enablement).

While investment is a relatively new domain for Wise, they are already making waves in the market by enabling users to spend up to 97% of the invested money in their accounts with a Wise debit card or transfer funds overseas. The idea is that users can hold their funds in stocks but still spend and send the money in real-time without waiting for 3–5 business days before stocks can get liquidated and converted to spendable cash 👇.