Wise Posts 25% Jump in Q2 Revenue as Remittance Skyrockets

Wise (formerly TransferWise), the British fintech primarily facilitating cross-border money transfers, released a trading update on Tuesday, reporting a 25 percent yearly jump in its revenue for the second quarter of the ongoing financial year.

In absolute terms, the revenue came in at £132.8 million. However, quarter-over-quarter the company registered a revenue growth of 8 percent.

Client Activities Jump

The jump in revenue was pushed by the rising demand for retail money transfers. Wise revealed that almost 4 million customers made transactions in the quarter. The number of active personal customers on the platform increased by 22 percent, whereas active business customers grew by 44 percent.

The total volume of transactions shot up 36 percent year-over-year to £18 billion. However, the company’s ‘take rate’, which it books as revenue, decreased to 0.74 percent from 0.8 percent in the same quarter in the previous fiscal. It justified the lower take rate because of the decreased transaction fees.

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“…the price drops were partially offset by revenue from other sources beyond cross-border transactions. But, at the same time, we’ve seen a higher gross margin as we continue to reduce the marginal cost of a transaction,” the company noted.

The fintech firm is now expecting revenue growth in the low to mid 20 percent range for the entire financial year.

“During the quarter we made strong progress: we dropped prices faster than hoped, our payments got faster, with more features for businesses, and we launched our exciting new ‘Assets’ feature for customers in the UK,” said Wise Co-Founder and CEO, Kristo Käärmann.

“We’re moving more of the world’s volume and operating at a lower cost, the benefit from which we’ve passed onto our customers, whilst maintaining a sound sustainable business model that’s investing even more for the long term.”