Business banking challenger Wise launches premium account in US

Written by Ruby Hinchliffe
11th August 2020

Wise, a new US business banking challenger, has launched its premium checking account in the US. Priced at $10 a month, it merges banking, payments and customer support capabilities.

CEO Arjun Thyagarajan

Businesses can earn up to 1% annual percentage yield (APY) on their deposits. They can also send and receive various payments through the app, and get access to 24/7 live chat support.

Wise’s approach

The Californian challenger piggy backs off BBVA, the US subsidiary of Spain’s Banco Bilbao Vizcaya Argentaria, to FDIC-insured customer deposits.

It also boasts partners such as payments unicorn Stripe, Canadian ecommerce giant Shopify and accounting helper QuickBooks. These partners give Wise direct access to an onboarding pool of millions of small businesses.

“If you look at other [banking] options out there, they’re going direct to the customer; what we’ve learned is that it is better to partner,” CEO Arjun Thyagarajan tells TechCrunch. “They’re signing up inside these ecosystems so we want to partner with these ecosystems.”

In April, the fintech start-up – founded in 2018 – raised a $5.7 million seed round.

Led by Base10 Partners, the round also saw participation from Abstract Ventures, Backend Capital, The Fund and Two Culture Capital. The start-up has around 18 employees so far.

Making money

As well as its $10 a month premium account, Wise also takes a revenue share from the deposits it holds with partner bank, BBVA.

Every time a customer uses a Wise card to make a payment, the challenger also makes money on the interchange.

The start-up plans to keep customer churn low by offering a wider scope of financial services through its core offering, such as payroll and accounting.

So far, it’s built up a customer base of around 1,000 businesses. The average Wise business customer has between two-10 employees and making between $500,000 and $5 million in annual recurring revenue (ARR).