Wise adds a new interest feature to its accounts – what’s in it for US customers?
- Wise has added a new interest feature to the Wise Account, earning US-based businesses and individual customers on their USD balances.
- Tearsheet spoke with Ankita D’Mello, senior product manager at Wise, about how the feature was built and if it aims to rival banks’ interest-bearing accounts.
Wise has added a new interest feature to the Wise Account, which provides a chance for US-based businesses and individual customers to currently receive 4.13% APY on their USD balances.
Consumers who opt-in need to verify their SSN/EIN. Following the verification, they are eligible to earn interest on their USD balances while still maintaining and managing their business operations – to send, spend and receive money internationally – along with access to their funds for personal financial needs. There are no restrictions to the amount customers can hold in the account and no balance minimums or additional fees are involved.
The new offering will also allow consumers to be eligible for FDIC pass-through insurance up to $250,000 through Wise’s program bank, JPMorgan Chase.
Wise reserves customer funds with program banks that generate interest on that deposit. This provides a window of opportunity for US customers to earn interest on their USD balances.
I spoke with Ankita D’Mello, senior product manager at Wise, about how the feature was built and if it aims to rival banks’ interest-bearing accounts.
How was the new interest feature built?
Ankita D’Mello: At Wise, we build all of our new products and features based on customer feedback to ensure they are designed to meet their needs. This interest feature is exactly that — we heard from our customers that they wanted an option to earn interest on the money they’re holding with us.
On the backend, Wise stores customer funds with program banks, which generates interest. As rates have improved, we saw an opportunity to honor our core value of transparency and provide an option for our US customers to benefit from this and earn interest on their USD balances.
This is effectively an amplification of the Wise Account offering to better meet the needs of our customers and we know they’re incredibly excited to experience it.
Is Wise rivaling banks’ interest-bearing accounts through the new offering?
Ankita D’Mello: We launched this feature to provide our customers with a flexible account that better suits their needs and to continue driving our evolution as a business. In doing so, we are also giving our US customers an option to take advantage of the positive interest rates in the market.
Where does the new feature fit into Wise’s broader growth plans for the US market?
Ankita D’Mello: As an organization, Wise is expanding into being an international account and this new feature really helps us showcase that shift.
Ultimately, we are building a new global standard for how people and businesses move and manage money globally. With our unique solutions — and unique underlying infrastructure — Wise is growing as a company to better meet the needs of our customers. And, our innovations are also driving new standards across fintech and financial services.
Central banks may stop raising interest rates – how will that impact the new offering?
Ankita D’Mello: Interest rates can change depending on fluctuations in the market from the Federal Reserve.
If there is a change, we will notify our customers as soon as possible. That said, those fluctuations also mean the rate of interest can also go up. If that were to happen, we would assess the interest rate and update customers accordingly on any changes.