There seems to be no shortage of FinTechs helping customers save money and time via alternative banking methods.
London-based TransferWise is one of those firms—and its offerings helped it become Europe’s most valuable FinTech last year after a $292 million funding round led by Lead Edge Capital, Lone Pine Capital, and Vitruvian Partners. The infusion gave TransferWise a valuation of $3.5 billion.
Launched in 2011 by Kristo Käärmann and Taavet Hinrikus, the company provides customers with a cheaper and easier way to transfer money internationally. It has partnered with banks and service providers on three continents, including Monzo in the U.K., bunq in the Netherlands, N26 and Mambu in Germany, Activo Bank in Portugal, and Alibaba’s Alipay in China.
As a result, the company has attracted around 8 million customers, saving them more than £3 million a day in hidden fees. The company has also expanded its reach to allow payments in the form of bank transfers, debit cards, and credit cards.
Now the company is looking to expands its offerings further, having just obtained a license from the U.K.’s Financial Conduct Authority to offer retail investment services. TransferWise plans to launch its first investing feature in the next 12 months.
The move makes sense as the company has reported that a growing number of its customers are using the platform as an international banking solution. In addition, around one million TransferWise debit cards have been issued since 2018.
“Clearly they’ve already figured out that TransferWise works for them,” CEO Käärmann told Tech Crunch. “And not merely as a medium of sending money from one country to another but also to get paid internationally, to kind of run their international part of banking, if you like. For businesses, for freelancers, for ex-pats, for people that have just moved countries. So this is another feature along the same string of things that people want us to do for them.”
One thing the company doesn’t want is to become an actual bank. Käärmann explained that the only thing a banking license in Europe would allow Transferwise to do is lend out customer deposits—and that’s something its client base is asking for.