Is Wise a Safe App for Sending and Holding Money?

Wise (formerly TransferWise) operates as a global technology company specializing in international money transfers and multi-currency accounts. As individuals and businesses increasingly rely on digital platforms, understanding their safety and security measures is a primary concern. This article explores the safeguards Wise employs to protect user funds, secure accounts, and manage personal information, also outlining support systems for dispute resolution.

How Wise Secures Customer Funds

Wise is regulated by financial authorities in various jurisdictions where it operates, ensuring adherence to financial regulations. In the United States, Wise US Inc. is registered with the Financial Crimes Enforcement Network (FinCEN) and holds licenses as a money transmitter in numerous states. These regulatory bodies supervise Wise’s operations, imposing rules to protect consumers.

A core principle of Wise’s approach to fund security is “safeguarding.” This means customer money is kept strictly separate from Wise’s own operational funds. This segregation ensures that even in the unlikely event of Wise’s insolvency, customer money remains distinct and protected.

Unlike traditional banks, Wise does not lend out customer funds. Instead, customer money is held in secure, liquid assets, primarily in cash with reputable financial institutions and in low-risk government bonds. For example, in the US, funds are held with major banks like JPMorgan Chase.

Wise is not a bank, so balances held are not directly covered by deposit insurance schemes like the Federal Deposit Insurance Corporation (FDIC) for all balances. However, for eligible customers who opt into the interest feature on their USD balances, Wise facilitates pass-through FDIC insurance up to $250,000 through its program banks. This provides additional protection for those specific balances.

In the rare scenario of Wise ceasing operations, an appointed insolvency practitioner would be responsible for returning safeguarded funds to customers. While this process may take time, it underscores the separation of customer assets from the company’s liabilities.

Protecting Your Wise Account

Wise implements several security measures and technologies to protect user accounts and transactions. Two-factor authentication (2FA) is a standard requirement for logging in and performing sensitive actions, adding a layer of security beyond a password. Users can choose to verify their identity through the Wise app, a separate authenticator app, or via SMS/phone call.

When a login attempt occurs, Wise provides real-time notifications detailing the location, browser, and operating system of the access attempt. This allows users to quickly identify and respond to any unauthorized activity.

Data transmission within Wise’s systems and to external parties is protected using advanced encryption protocols, such as Transport Layer Security (TLS). This encryption helps secure sensitive information as it travels across networks and when stored.

Wise maintains internal security teams and employs sophisticated fraud prevention algorithms that operate continuously. These specialists and automated systems work to detect and mitigate fraudulent activities, constantly monitoring for potential threats and responding to emerging security challenges.

Safeguarding Your Personal Information

Wise demonstrates a commitment to data privacy through its practices and compliance with applicable regulations. The company adheres to data protection laws, including principles similar to those found in the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA).

Personal data is collected, used, and stored only for legitimate purposes directly related to providing Wise’s services and fulfilling regulatory obligations. This includes information necessary for account setup, transaction processing, and compliance with anti-money laundering requirements. Wise does not share data with third parties for marketing purposes without explicit consent.

Measures such as data encryption, strict access controls, and regular security audits are in place to protect against unauthorized access or data breaches. These controls limit who can access personal data and ensure that only authorized personnel handle sensitive information. Wise undergoes external audits, such as SOC 2 and PCI-DSS, to validate its security posture.

Users have specific rights regarding their personal data, including the right to access the information Wise holds about them. They can also request rectification of inaccurate data or, in certain circumstances, request the deletion of their personal information.

Support and Dispute Resolution

Wise provides multiple channels for users to seek assistance, report security concerns, or address potential fraud. Users can access support through in-app chat, phone, or email for reporting suspicious account activity or unauthorized transactions.

In cases of suspected fraudulent card payments, users can quickly freeze their Wise card through the app to prevent further unauthorized use. Wise has a clear process for reporting such incidents, encouraging users to provide details to aid investigations. The company’s support team investigates reported issues and provides updates.

If a user suspects they have been a victim of a scam involving a Wise transfer, they can report it directly through their Wise account activity. While Wise aims to resolve issues internally, users also have avenues for escalation. If a resolution is not reached directly with Wise, users may have the option to contact relevant regulatory bodies or ombudsman services for further review.

Wise, like other financial technology companies, has faced regulatory scrutiny and enforcement actions concerning compliance and consumer protection. These instances highlight the ongoing commitment to address and strengthen internal controls and processes. Wise is required to invest in enhanced compliance systems and provide regular reports to regulators as part of these actions.