Going global with your business is an outstanding feat. The change in banking needs that usually accompanies this growth, on the other hand, can be expensive, complicated, and a huge time-suck.
Currency exchange is known to be a huge profit stream for regular banks (even when you ask for a preferred rate!), and paying and getting paid by partners across borders can be a massive hassle with delays and transaction fees.
With Wise Business, you may be able to avoid all of these issues and take your operations global with ease, saving both time and money.
I have mentioned before that I really like the Wise personal account. So in today’s post, let’s go through the Wise Business Account in Canada’s features and fees and find out whether it lives up to the good features of Wise personal.
Digital International Business Banking Service
- Extremely cheap international money transfers.
- Over 50 different currencies available
- Borderless Visa card
- Mid-market exchange rates with no mark-up
- Low and transparent fees
- A streamlined business accounting interface
- Free invoice and payroll payments
- App or desktop access
- Good customer support
- Regulated by FINTRAC
- 60+ currencies
- No cash withdrawal or deposit options
- No chequebook
- In-person banking is not available
- Only supports charities and trusts in select countries.
What Is Wise (Formerly Transferwise) Business?
Formerly known as Transferwise Business, Wise Business accounts offer digital, low-fee, multi-currency business banking solutions to businesses in Canada and across the globe.
Wise Business allows small and medium-sized businesses to pay and get paid in a multitude of different currencies by international firms and individuals, significantly cutting down costs and streamlining many tedious accounting tasks.
Wise’s three guiding principles are low costs, transparency and fairness. You only pay for what you use, take advantage of mid-market exchange rates, know all of the associated fees upfront (though most of their business account features are free to start with).
With a goal to make business banking fairer, they launched Transferwise Business.
According to them, the now-called Wise Business is up to seven times cheaper than a traditional bank when sending money abroad. That’s significant savings.
So, other than cost-effective international transfers, what are the features and benefits of having a Wise Business account?
Just like the Wise Personal account, Wise Business account holders can take advantage of extremely low fees and the use of the mid-market exchange rate.
As a reminder, the mid-market currency exchange rate is the midpoint between the buy and sell prices of any two currencies at a given time.
Usually, traditional banks and currency exchange bureaus will add significant mark-ups on the mid-market exchange rate.
In addition to this, Wise Business offers four great business banking features. Let’s go through each of them to figure out whether they can fill a gap in your business operations.
1. Invoice Payments
If you’ve gone global and need to pay invoices internationally, Wise Business’s invoice payment system allows you to pay using the real exchange rate in more than 70 countries.
Sent directly from your phone or app, most invoice payments through the system are instant or arrive within an hour, regardless of which country you are sending to.
The only thing you need to pay invoices with Wise Business is the recipient’s bank details or email address (similar to an e-transfer). They do not need a Wise account in order to get paid.
This feature can be a cost-effective method for businesses to streamline their operations around invoice payments, saving both time and money.
In fact, according to a study done by Wise in 2021, it’s around 19x cheaper on average to send and receive payments via Wise than it is with PayPal.
So if you’ve been using PayPal to pay international invoices thus far, it might be worth it to consider transferring to Wise.
2. People/Employee Payments
With Wise Business, you can pay your employees at the same place you pay your invoices, no matter where in the world they may be based.
You can pay up to 1,000 people at once and save time and money on international payroll, employee reimbursements, or recurring payments by taking advantage of their low fees and fair exchange rates.
If you have team members who take care of your business accounting and admin, Wise Business allows you to add them to your account as authorized users to help with payments and streamline operations.
With this feature, you also have the ability to control their access and permissions to the platform to make internal collaboration even more effective.
3. Receive payments
Wise is teamed up with major financial institutions worldwide and is regulated by the same authorities as banks.
Through your Wise Business account, you can receive payments in multiple currencies without high recipient or currency exchange fees.
In addition, Wise Business allows you to convert or move money within Wise Business or withdraw to external accounts without much effort or fees.
You can also withdraw from online sellers or trading platforms (such as Stripe and Shopify) using your personalized IBAN and other account details (though this last feature comes with a one-off cost of $42 that I will discuss in the next section.)
4. Multi-Currency Banking Without The Bank
One of the best features of Wise Business, in my opinion, is that you have the option to hold bank accounts in more than 70 currencies regardless of where you are based.
For instance, say that you are a Canadian business and one of your contractors or clients lives in The Netherlands.
With a Wise Business account, you can have a Euro bank account equipped with the same features of a local Dutch bank account, making sending and receiving Euros significantly easier.
With such an account, you also have an associated sort code, IBAN, and other account details you would need to pay or be paid with your partners in Europe, truly making your business banking borderless.
This feature is also available for personal accounts. However, there is a one-time fee associated with this benefit for business accounts, which I will detail now.
As I mentioned, some of Wise’s guiding principles are low fees, fairness and transparency.
As a result, the costs associated with their business accounts are cheaper than most business banking solutions out there, especially those offered by traditional banks.
With Wise Business, it’s completely free to set up a new account. There are no recurrent fees associated with any of their accounts.
You can convert between currencies in your Wise Business account using the actual exchange rate and send money abroad for a fee starting from 0.35%. Receiving payments with Wise, on the other hand, is entirely free.
The one optional fee associated with Wise Business accounts is a one-time fee of $42, which will give you account details in 10 different currencies: AUD, CAD, EUR, GBP, HUF, NZD, RON, SGD, TRY and USD.
If you plan to do all of your international banking with Wise, I believe that this is entirely worth it, mainly because it’s a one-off payment and not an annual fee.
This $42 add-on will also give you the option to withdraw money from platforms like Shopify, Stripe, etc., receive payments from a third party and set up direct debits.
Below are the details for what you get with a completely free business account vs. the additional features you get with the $42 package, so you can compare the two and decide whether the add-on package is right for you.
Besides this optional $42 fee, there are only a few other charges that you need to look out for with Wise.
First, if you’re planning on holding more than 70,000 EUR or equivalent in your business account, note that an annual fee of 0.4% will be charged monthly. And second, there is a USD $7.50 flat fee for receiving USD wire payments.
This same charge applies to personal accounts, as noted in my Wise Personal account review.
As I mentioned, Wise is highly transparent about its fees. As a result, you’re never hit with a charge you didn’t see coming, which I think is great
A Wise Business account is the best way to go if you are a registered business in Canada. Otherwise, the Wise personal account is perfect for day-to-day transactions and international banking for your individual needs, separate from your company.
If you run multiple businesses, you can have Wise Business accounts for each one. In addition, wise gives you the option to have your accounts live under one set of login details, which is very convenient. For personal accounts, on the other hand, you can only have one.
Regarding fees and conversion rates, I would say that these two accounts are nearly identical; the same prices apply regardless of whether you are using a business or personal account.
Multi-currency banking, however, is free for personal accounts and comes at a CAD 42 cost for business accounts. As I covered in a previous section, this feature gives you business account details in 10 different currencies as well as other business banking perks.
At the end of the day, personal and business accounts have different purposes. If you have a registered company and operate internationally, you should have a Wise Business account. If you choose to, you can also have a Wise personal account.
I would have to say that there aren’t many alternatives out there for international business banking that can rival Wise.
The ability to have account details like an IBAN, sort code and routing number for multiple currencies is really unique and is not offered by many banks out there.
However, Wise Business is not Canada’s only digital business banking option. I’ve covered many other business banking options on Wealth Awesome before, and you can see my top picks here to compare: 12 Best Business Bank Accounts In Canada 2022.
If you are working with different partners across borders or sending and receiving money in various currencies, I would recommend that you go with Wise – I’m a big fan of them. You can sign-up for Wise Business here.
If you operate more locally, however, and want access to things such as chequebooks, in-branch services, and cash deposits and withdrawals (none of which are offered by Wise due to their digital nature), you can check out Tangerine or one of the big five in Canada.
How I Use Wise
As a digital nomad who works remotely around the world, Wise Business is a lifesaver for me. I have to receive and send money to five different countries, and Wise makes that a breeze. It saves me thousands of dollars in fees per year, as compared to a traditional bank.
The best part about Wise in my opinion is its transparency; you get the real exchange rate, unlike other banks who try to rip you off. The foreign exchange fee is a tough one to see so it’s easy to get tricked into paying more by other banks, but
Signing up for Wise is quick, easy, and free. Head to Wise’s website, click on the Business tab on the top left corner and open an account in a matter of minutes.
As a business, you’ll need to be verified in order to start using your account, just as you would with a regular brick-and-mortar bank (as I mentioned, Wise is regulated by the same governing entities as banks are).
This allows Wise to keep their customers’ money safe and comply with the financial laws in the countries that they operate.
In order to get verified, you will need to share personal details as the account holder as well as details about your business (such as business registration, the industry you’re in, where you’re located, stakeholder information, online presence, etc.)
If you’re signing up for the add-on package, you will also have to pay $42 at this time.
Once you do this, Wise will work on getting you verified, and you should be good to go in about two to three business days. Note that this is actually much quicker than the processes at regular banks.
If your business is based in the US, Singapore, Japan, Hong Kong, or New Zealand, there may be additional things Wise needs before they verify your account to comply with country-specific rules.
Are you a charity or trust looking to use Wise Business? Whether you can sign up for Wise Business will depend on where you are located.
Wise only supports charities registered in Canada, EEA (European Economic Area), Switzerland, UK, US, Australia and New Zealand and trusts in Canada, EEA (European Economic Area), Switzerland, Australia, New Zealand and the UK.
I am a big fan of Wise Personal, and the same is the case for Wise Business. I had mentioned before that Wise was a big part of my finances as a digital nomad, and I really appreciate their transparency and customer-oriented business practices.
Wise Business can take the guessing game out of how much international banking is going to cost you, streamline your operations and save you money. Not to mention that with the move towards digital, business is becoming even more global in nature, transcending borders with the help of the internet.
For this reason, I believe that the international banking that Wise Business offers is only to grow in reach and need across the globe. You can sign up for Wise here or check out an in-depth review of Wise Personal here.