Wise Account vs traditional bank account?

[Hamus Yaigh]

My NatWest bank in the Channel Islands, under new policy, is about to start monthly charges since my account is classed as International and using my Thailand mailing address. Until now it was always free.

 

I am looking for alternatives with no fees. Is Wise a good idea? What would be the drawbacks of using Wise Account vs traditional bank account?

[Chris.B]

None, go for it.

 

[gamb00ler]

I would be surprised if there is any recourse if Wise goes bankrupt, or is hacked, or the owners figure out how to steal your money and disappear.  Many countries have a form of insurance for their "chartered" financial institutions to cover at least a portion of the funds on deposit in such cases.  Those scenarios are fortunately rare but extremely unsettling to suffer through.

[lkn]

On 1/7/2022 at 5:01 AM, Hamus Yaigh said:

What would be the drawbacks of using Wise Account vs traditional bank account?

You pay a fee for all outwards transfers, unless they happen through your debit card.

 

But if you never need to transfer money to other people, it could work. As for security, Wise keep customer funds separate from their operating cash, this is required by law, so if Wise goes bankrupt, your funds should be safe.

 

I’ve actually considered something like this myself, but I need bill pay and other stuff that Wise can’t handle.

Edited January 8, 2022 by lkn

[Chivas]

Wise is the only company who operates at full Interbank rates. There is no other. Combine that with relatively low fees and I defy anyone to find a transfer of £5000 (as an example) from another provider that lands with a better bottom line (edited to add not including opening special offers for new accounts)

 

You'll be there all day trying. Purely because even your own bank doesn't remit at interbank but relies on landing TT rates which are always lower

 

Fixed fee yes with most UK banks but you'll need to send well into 5 figures before the bottom line is better in catching up

 

I tried with £15,000 not long ago using the indicated TT rates for SCB for that day and still Wise came out ahead

Edited January 9, 2022 by Chivas

[gamb00ler]

1 hour ago, Chivas said:

Wise is the only company who operates at full Interbank rates. There is no other. Combine that with relatively low fees and I defy anyone to find a transfer of £5000 (as an example) from another provider that lands with a better bottom line (edited to add not including opening special offers for new accounts)

 

You'll be there all day trying. Purely because even your own bank doesn't remit at interbank but relies on landing TT rates which are always lower

 

Fixed fee yes with most UK banks but you'll need to send well into 5 figures before the bottom line is better in catching up

 

I tried with £15,000 not long ago using the indicated TT rates for SCB for that day and still Wise came out ahead

I calculated the transfer amount at which SWIFT and Wise yield the same baht.  My assumptions were based on US$ transfer and a SWIFT fixed fee of $25.  At 22K US$ and above SWIFT was the better deal.  The Wise transfer was funded using the lowest fee method which requires the sender to first transfer from their bank to the Wise multi-currency account.  In US this initial transfer of funds to Wise is usually free and takes 2-3 days.  If the sender uses a different method of funding the conversion to baht, Wise will impose more fees and the point at which SWIFT is the better deal becomes lower.

[treetops]

1 hour ago, gamb00ler said:

I calculated the transfer amount at which SWIFT and Wise yield the same baht.  My assumptions were based on US$ transfer and a SWIFT fixed fee of $25.  At 22K US$ and above SWIFT was the better deal.

Wise show on their front page comparison that Moneygram give a better deal up to c $10,000 USD and they use a rate better than mid market.  I've no idea what the catch is, but it sounds good to me.  Wise would appear to be best between 10K and 22K USD if all we see is true.

 

[BritManToo]

I don't trust them!

Not for more time than it takes to get my money from my UK bank to my Thai bank anyway.

[BritManToo]

1 hour ago, gamb00ler said:

I calculated the transfer amount at which SWIFT and Wise yield the same baht.  My assumptions were based on US$ transfer and a SWIFT fixed fee of $25.  At 22K US$ and above SWIFT was the better deal.  The Wise transfer was funded using the lowest fee method which requires the sender to first transfer from their bank to the Wise multi-currency account.  In US this initial transfer of funds to Wise is usually free and takes 2-3 days.  If the sender uses a different method of funding the conversion to baht, Wise will impose more fees and the point at which SWIFT is the better deal becomes lower.

You forgot the 500bht charge at the Thai bank for incoming SWIFTs.

(which they don't tell you about, and doesn't show on your bank statement)

Edited January 9, 2022 by BritManToo

[treetops]

1 minute ago, BritManToo said:

You forgot the 500bht charge at the Thai bank for incoming SWIFTs.

(which they don't tell you about, and doesn't show on your bank statement)

And potentially any intermediary bank fees too?

[gamb00ler]

messed up so binned it.

Edited January 9, 2022 by gamb00ler

[gamb00ler]

53 minutes ago, BritManToo said:

You forgot the 500bht charge at the Thai bank for incoming SWIFTs.

(which they don't tell you about, and doesn't show on your bank statement)

LOL.... nice try.  Did you hack into my computer and steal the spreadsheet I used?  You don't really have a clue if I did or did not include that fee.

It seems you're well qualified for a job in the misinformation field.

[Stocky]

2 hours ago, gamb00ler said:

My assumptions were based on US$ transfer

So your comparison is applicable to USA.

 

The numbers work out differently if I look at my transfers from the UK or Singapore. Firstly there is no charge on domestic transfers in the UK or Singapore, secondly the exchange rate margins on SGD to THB and to a lesser extent GBP to THB are greater than for USD to THB, there being greater movement of USD. Lastly there is usually an intermediary bank involved with SWIFT transfers which add their own charges.

 

People deciding whether to use Wise or SWIFT need to do their own homework.

[gamb00ler]

1 hour ago, Stocky said:

So your comparison is applicable to USA.

 

The numbers work out differently if I look at my transfers from the UK or Singapore. Firstly there is no charge on domestic transfers in the UK or Singapore, secondly the exchange rate margins on SGD to THB and to a lesser extent GBP to THB are greater than for USD to THB, there being greater movement of USD. Lastly there is usually an intermediary bank involved with SWIFT transfers which add their own charges.

 

People deciding whether to use Wise or SWIFT need to do their own homework.

I agree that people should do as I have done and do their own homework.  I gave my assumptions and the results only.  Next time I'll just show the entire calculation as some readers here love to jump at any chance to post a negative assessment.

 

When it comes to intermediary banks, I believe that my US credit union MUST use that method.  They charge $30 per international wire and probably just roll any fee paid to other banks into one all encompassing charge.  My total charge is exactly what they quote.  Either that or there is some hidden charge but then the transfer somehow uses a better rate than the TT rate with the net result being exactly equivalent to a $30 fee.  That seems far-fetched.

[Pib]

Is it safe to keep money in my Wise account?

https://wise.com/help/articles/2949821/is-it-safe-to-keep-money-in-my-wise-account

[Stocky]

59 minutes ago, gamb00ler said:

My total charge is exactly what they quote. 

Sadly that's not the case if I use HSBC and SWIFT from Singapore, any intermediary bank charges pop up after the event. It's the total transparency I have with Wise that is the biggest appeal, yes I usually save a few thousand baht on a transfer, but it's knowing exactly how much will be credited to my account is the biggest plus.

 

That said, Wise and similar P2P money transfer companies are making the established banks sit up and take notice. HSBC now have a Global Money Transfers app, which they say is 'largely' fee free - the small print still says there may be intermediary bank charges, and their rates aren't as good, but it's certainly a move in the right direction.

 

Bank on topic, has the OP considered Monzo, which is a registered UK bank which Wise isn't. But for international transfers Monzo used Wise, so win win. Downside is you need a UK address, with proof in the form of a utility or council tax bill.

 

.

Edited January 9, 2022 by Stocky

[Chelseafan]

7 hours ago, BritManToo said:

I don't trust them!

Not for more time than it takes to get my money from my UK bank to my Thai bank anyway.

I suspect you are throwing hard earned cash in the bin then, Wise has always come out tops compared to my bank. While my bank offers a fixed fee, the exchange rate is shocking.

 

 

[gamb00ler]

1 hour ago, Chelseafan said:

I suspect you are throwing hard earned cash in the bin then, Wise has always come out tops compared to my bank. While my bank offers a fixed fee, the exchange rate is shocking.

 

 

The only time I find the exchange rate to be shocking for a SWIFT transfer is when the sender lets his bank do the exchange to Thai ฿ rather than the Thai bank.  Foreign banks offer "shocking" exchange rates to do the conversion on their end.  Please let the Thai bank do the conversion on shore in Thailand.

 

At this moment, Wise offers 33.63 ฿/$ and SCB bank offers 33.5 ฿/$ (TT rate).

However, Wise fees are at least $5.36/1,000$ + $1.25.  That fee results in the effective Wise exchange rate being reduced to 33.63 * (1.00 - .00536) or 33.45 ฿/$.  In its favor, Wise does not charge any other fees unless you use a debit card or an additional ACH transfer to fund your purchase of ฿.

 

What the above figures mean is that above a certain transfer amount, SWIFT (your bank method) will be more efficient than a Wise transfer.  If your bank charges a $25 flat fee and the Thai bank charges the typical min 200฿-max 500฿ for an international wire then a transfer larger than 22K US$ will be cheaper via SWIFT.  Below that amount, Wise offers better results.

[lkn]

3 hours ago, gamb00ler said:

What the above figures mean is that above a certain transfer amount, SWIFT (your bank method) will be more efficient than a Wise transfer.  If your bank charges a $25 flat fee and the Thai bank charges the typical min 200฿-max 500฿ for an international wire then a transfer larger than 22K US$ will be cheaper via SWIFT.  Below that amount, Wise offers better results.

It is always hard to do these comparisons because rates change, and a SWIFT transfer may take a day or two, but I concur, in my experience, I have also gotten pretty good rates from Krungthai when I did SWIFT transfers, but I think I had to send > $10k for them to give me the better exchange rate, which was not listed on their site, but seemed to be a market rate, as initially they would call me to have me OK the rate they could get for me.

[Chivas]

17 hours ago, Chelseafan said:

I suspect you are throwing hard earned cash in the bin then, Wise has always come out tops compared to my bank. While my bank offers a fixed fee, the exchange rate is shocking.

 

 

Always does and always will....I have no axe to grind and further to my earlier post on the thread every 3 months or so I re run Wise against various providers and Wise always comes out on top

 

Not only that of my last god knows how many transfers every single one was absolutely instant in landing in the SCB and the one that didnt took an outrageous........2 hours lol

 

Wise every time bar none

 

Cost speed and bottom line

[Hamus Yaigh]

On 1/7/2022 at 11:01 AM, Hamus Yaigh said:

I am looking for alternatives with no fees.

It appears after a phone call chat to NatWest there is an alternative account type that will continue to have no fees for international users so I will go with that for now using Thailand as my mail address. I have only a small deposit so fees made no sense to me. I sometimes find it useful having a traditional bank as their statements can be used as proof of my address.