Inside Wise: Cutting Costs and Innovating Payments
Conversation with Balázs Barna, Head of Product at Wise
During Money20/20, I had the pleasure of speaking with Balázs Barna, Wise's Head of US Engineering & Austin Office Site Lead. He shared fascinating insights into Wise's payment strategy, touching on geo-expansion, compliance, and innovation in the payments ecosystem.
Expansion Strategy
You’ve already covered many countries. Is your strategy to expand into more regions or deepen your presence in existing ones?
"We currently support more than 40 currencies across over 160 countries," Balázs explained. "For example, the EU has one currency but spans multiple countries. It’s important to differentiate between supporting pay-ins and pay-outs, as they’re not the same. Our priority is to offer both in the regions where we operate."
Wise’s strategy focuses on investing in low-cost, high-quality payment infrastructure. While new markets like the UK and Australia are on the radar, they remain committed to enhancing their operations in existing regions.
"Take England, for example – we gained direct access to the UK Faster Payments System in 2016. This step allowed us to save 20% on fees, and those savings were passed directly to our customers through lower fees," Balázs shared. "Instant payments are also a key focus, as they’re highly valued by customers. We’ve seen significant traction wherever we enable this feature."
Managing Market Depth
How do you manage to establish such a strong presence in each market?
"Wise holds 65 licenses globally, making us one of the most regulated companies in the payments industry," Balázs said. "Compliance is critical. We proactively engage with regulators and aim for complete transparency. This approach fosters trust and collaboration."
By maintaining strong relationships with regulators, Wise ensures its operations remain compliant while delivering high-quality services.
Tackling Fraud
Payments often come with fraud risks. How does Wise handle this?
"Fraud management is a major investment area for us," Balázs emphasized. "We’ve hired hundreds of engineers and developed advanced machine-learning models to combat fraud. Additionally, we work with third-party providers to bolster our defenses."
Wise employs a global fraud detection model, analyzing data to stay ahead of fraudulent activity. "Compliance and fraud prevention go hand in hand. We thoroughly investigate every fraud case to learn and adapt," he added.
Supporting Local Payment Methods
How important is it for Wise to support local payment methods like FedNow or PIX?
"It’s incredibly important," Balázs said. "Customers value the convenience of using local payment methods, and it allows them to choose options they’re most comfortable with."
Wise prioritizes integrating alternative local payment methods to enhance the user experience. "While not all payment networks are open for integration, we actively work with those that are."
Introducing Invoice Solutions
Wise recently launched an invoicing solution for customers. Can you share more about it?
"This is part of our broader strategy," Balázs explained. "Wise is already a great partner for accepting payments due to our low fees. We’ve designed the invoicing solution to be simple and intuitive, which has made it popular among international business owners."
The platform simplifies accepting international invoices, particularly for businesses operating across multiple regions. "For example, if you have businesses in Germany and the U.S., our platform allows seamless international transactions. Features like auto-conversion rules for currencies and interest-earning capabilities across multiple currencies are unique value propositions."
Driving Payment Improvements
What initiatives are you pursuing to further improve payments?
"One of our main goals is investing in more direct integrations with payment networks to lower fees," Balázs said. "We’ve also heavily invested in internal machine-learning tools to streamline payment operations, reducing costs and, ultimately, fees for customers."
Wise remains committed to creating more efficient payment systems that benefit users worldwide. "Operational efficiency and customer affordability drive everything we do," Balázs concluded.