With growing partnerships, what’s next for Wise in the US market?
- Wise extends its features via its APIs to its partners – banks, fintechs, and corporates – which they can integrate and build directly within their own offering.
- Folley Ogundele, VP of Wise Platform at Wise, provides insights on how Wise solutions are integrated within its most recent partner companies in the US — AvidXchange, Brex, and Ramp.
Over the course of time, the financial industry has seen substantial changes in international transactions, which can be attributed to increasing globalization and digitization.
Data shows that cashless transaction volume will surge by 43% by 2030 in the US alone. And global spend on B2B cross-border payments is expected to exceed $40 trillion by the end of 2024, rising from $27 trillion in 2022.
Intensifying competition and changing consumer behavior mean that payment diversity is here to stay, particularly when it comes to B2B cross-border payments.
Many solutions and offerings are being launched by providers to overcome the challenges of B2B payments, but we’re yet to see them used to their full potential. Use cases may be varied but pain points are broadly the same among businesses and consumers dealing with B2B payments cycles.
As a result of changing customer preferences, an increasing number of companies are now integrating embedded finance solutions in their B2B offerings in addition to their consumer-facing payment verticals, a recent report indicates.
While banks are still in control of moving money globally for large corporations, fintechs are gaining market share for customers that typically operate in money transfers, ranging from small to mid-sized businesses.
One such payment provider is Wise which works with different types of businesses — from freelancers and entrepreneurs in the SMB space to large-scale enterprises. The platform extends its features via its APIs to its partners – banks, fintechs, and corporates – which they can integrate and build directly within their own offering.
With its 13-year-old cross-border transaction services for banks and fintechs with its multi-currency accounts, the company has since grown to serve over 16 million customers around the world.
The firm launched 15 new partnerships in 2022 and entered 2023 with a total of 60 partners globally. Its new partnerships with, G-P (Globalization Partners), Ramp, and Brex launched in the new year, and AvidXchange was announced at the end of 2022. Wise’s strategy is to enable businesses to scale and expand globally.
I spoke to Folley Ogundele, VP of Wise Platform at Wise, about how these new partnerships add value to the partner companies, how the role of partnerships is changing in the payments ecosystem, and what’s in the cards for Wise in 2023.
How are Wise solutions integrated within its most recent partner companies in the US — AvidXchange, Brex, and Ramp?
Folley Ogundele: At Wise, we are driven by our mission: money without borders and making the process of moving money internationally instant, transparent, convenient, and eventually free.
Through the Wise Platform, we have built a way for banks and businesses like Brex, Ramp, AvidXchange, and others to embed the Wise API into their existing infrastructure. In doing so, we’re helping to power the tools, solutions, and platforms that are building the best way for businesses and consumers to send, receive, and manage money internationally.
Other than the common problems that US SMBs face, what additional challenges still exist for the sector in 2023?
Folley Ogundele: The reality for SMBs in the US is that growing and scaling globally is key to their future success. This accelerated during the pandemic and as we head into 2023 we’re seeing this international growth continue.
As part of this global expansion, these businesses are either hiring internationally or working with global freelancers and contractors, establishing a number of challenges when making cross-border payments, particularly for payroll and reimbursements. Doing this through a bank means these businesses do not have a transparent view of the payment process, making it slow and often more expensive than planned.
That’s why Wise’s partnerships in this space with Brex, Ramp, and others are so important to the SMB sector because we are ensuring these payments are done in the right currency and with the FX rate clearly shown. This transparency is exactly what SMBs are looking for and it’s solving a major problem.
How are the cross-border payments pain points different for SMBs compared to big enterprises?
Folley Ogundele: For SMBs one of the biggest differences between them and big enterprises is resource management. When you’re a small business you need to maximize the time involved in managing accounting, payroll, and HR for your teams, and this is even more important when you’re operating globally.
Importantly, SMBs are looking for affordable, fast, and digital-first solutions to manage their cross-border payments. The challenge is that doing this through a bank means the service is slow and lacks transparency. But now that Wise is working with multiple platforms specifically designed for SMBs, moving money across borders is faster, easier, and more transparent.
How are fintech partnerships changing the way consumers and SMBs manage their finances?
Folley Ogundele: Fintech partnerships are really powering the future of financial services because there are gaps in the maturity of existing players, especially banks, that we’re helping to fill.
For many players the question is, do you build it yourself or do you invest in a partnership? And ultimately investing in that partnership is a stronger long-term play than trying to build a product from scratch.
What this means for consumers and SMBs is that the needs they now have — digital-first financial services, fast payments, transparent pricing — are driving change within the industry. These needs are now being met through fintech partnerships and we see incredible opportunity in this space.
How does the new service – Wise International Receive — contribute to the payments ecosystem?
Folley Ogundele: International Receive makes it easier for Wise’s bank and neobank partners to efficiently and reliably receive international payments using their existing account details. Rather than connecting with the SWIFT network themselves, banks of all sizes can use Wise as a correspondent and leverage our connection to power FX payments. The feature also enables financial institutions with an existing SWIFT setup to switch to Wise’s service, and receive these incoming payments more quickly, cheaply, and conveniently.
This feature is currently available for all Wise Platform partners and allows their customers to receive money from across the world as Euros safely into their bank account.
We are working on expanding into more currency routes and will be making announcements when they become available.
The rollout of International Receive expanded our Wise Platform offer, which has long-provided partners with a service that allows their customers to send money affordably and quickly, by adding the ability for them to receive money as well.
What’s next for Wise in the US market?
Folley Ogundele: We’ve really established Wise Platform as a best-in-class provider that banks, businesses, and fintechs partner with to power their cross-border payment solutions.
In the US, we’re continuing to grow our partnerships across the financial services sector, integrating with organizations and powering cross-border payments for both SMBs and consumers. The SMB space, in particular, has been a big one for us and we’re putting transparent pricing front and center in these partnerships, which is hugely impactful for these businesses.
Ultimately, we’re planning to grow our partnerships in 2023 and bring the power of Wise to even more US banks, businesses, and fintechs. This also includes a number of organizations that have cross-border needs but aren’t necessarily seen as financial services companies. There’s a lot more to come from us and we’re excited to share it.