Wise bets on its bank workaround to entice investors

• Key insight: Wise reported growth in payments and revenue in its first quarterly earnings report since listing in the U.S. 
• What's at stake: The London-based fintech is using direct connections to clearing networks in an effort to boost payments while cutting fees, key to its low-cost model. 
• Expert quote: "We are avoiding working with partner banks for certain countries because then we can provide liquidity faster." —Wise Chief Financial Officer Emmanuel Thomassin

Payment fintechs use several ways to avoid correspondent banks, shaving costs and time for cross-border payments. Wise is betting its direct connections to clearing systems will attract investors following its stock listing in the U.S.

"This is core to our value proposition. This is why we get partners joining us, that they're using our platform, our direct integrations," Wise Chief Financial Officer Emmanuel Thomassin said during Thursday night's earnings call.

During the call, Wise mentioned its recent connection to Japan's central bank, an early nonbank to connect to the BOJ, joining the dozens of other countries where Wise has a similar connection, using an application programming interface to enable the integrations. 

"We are avoiding working with partner banks for certain countries because we can provide liquidity faster," Thomassin said. 

Investors are keeping a close eye on Wise's ability to sell discount payments while minimizing revenue loss, a story it tried to sell on Thursday.

For the fiscal 2027 first quarter ending on June 30, Wise reported cross-border volume grew 26% to $69.3 billion from the prior year's quarter, with active customers up 21% to 11.9 million. Transaction revenue rose 27% to $541 million. Net revenue was $714 million, up 25% over the prior year.

Wise's lower-cost processing method helps support a strategy to cut its "take rate," or the fees that it charges for transactions. Wise plans several rate cuts throughout the year. Wise charges a percentage of the payment amount, between 0.33% and 2% depending on the currency pairs and corridor. It also charges a fixed fee, generally between 43 cents and $7 depending on the corridor and amount.

Correspondent banks charge a fee between $25 and $50, plus an exchange rate markup. By lowering the take rate, Wise is expanding its discount strategy, but also potentially cutting into its revenue. Wise's cross-border take rate slipped two basis points to 50 bps during the most recent quarter. The company reiterated its fiscal 2027 guidance of net revenue growth around the middle of a 15% to 20% medium-term target range.

"We want to continue to reduce the take rate because we know that at the end, again, this is the reason why our customers use us," Thomassin said. 

Wise's Thursday earnings report was its first quarterly report since debuting on the Nasdaq Stock Exchange, part of its planned move to U.S. markets. Wise says the U.S. listing will give it better access to capital markets, and aligns with payment market opportunities in the U.S. Wise, which will maintain London as a secondary listing, has 19 million customers globally and processed $242 billion in payments in fiscal 2026.

Wise's quarterly earnings suggest a strong start to the fiscal year, analysts at William Blair said in a research note.

"Growth was broad-based, but we are encouraged by accelerating active business customers growth of 28% (versus 25% in the December 2025 quarter and 27% in the March quarter), which led to 37% business cross-border revenue growth (versus 40% in the March quarter)," they wrote. "Wise's approach is a self-reinforcing flywheel: more cross-border volume drives scale benefits and gross profit dollars, which are systematically reinvested in the product, technology, infrastructure, marketing, and price, all of which drive more volume. Wise's cross-border take-rates should continue to decline, yet gross profit dollars, earnings, and cash flow should continue to grow," William Blair analysts said, adding the cross-border payments market has multiple competitors but can support multiple providers.