- Wise, a leading Fintech company valued at $6.6 billion, has come under fire from a rival firm for allegedly undermining competition in the money transfer market. Atlantic Money, a minor foreign exchange service, recently wrote a letter to the U.K. Competition and Markets Authority (CMA) accusing Wise of harming competition by delisting Atlantic Money from its foreign exchange fee comparison tool.
- Shares in Wise, which went public on the London Stock Exchange in 2021, have been affected by the allegations, with the company’s stock down 2% in early trading on Friday. Wise has a market capitalization of £5.3 billion ($6.6 billion).
- In the letter sent to the CMA, Atlantic Money claims that Wise unfairly removed it from the price comparison section of its website and refused to include it on Exiap, a foreign exchange fee comparison site owned by Wise. The letter states that Atlantic Money was initially listed by Wise on its website on October 14th, 2022, but was later delisted on January 20th, 2023, with Wise allegedly stating that Atlantic Money was “no longer deemed a legitimate competitor.”
- Atlantic Money argues that Wise’s conduct harms competition in the U.K. and E.U. and ultimately results in higher fees for end consumers. Atlantic Money offers a flat fee of £3 on all currency conversions up to £1 million, with its prices being lower than Wise for transfers of £1,000 or more.
- Wise, formerly known as TransferWise, has positioned itself as a champion of consumer rights, pushing for transparency around the fees charged by banks to move money across borders. In response to the allegations, a Wise spokesperson stated that Atlantic Money was removed from the website for several operational reasons, including customer complaints, and that Wise takes any complaints very seriously. The spokesperson also stated that Wise is proud to have a comparison tool as part of its website and is not afraid to list cheaper competitors.
- The letter from Atlantic Money to the CMA could be the first step in a potential investigation into whether Wise’s conduct breaches competition law. The CMA declined to comment on specific cases outside of a formal investigation.
- It is not the first time Wise has come under scrutiny for its business practices. In 2020, the company was fined by the Financial Conduct Authority (FCA) for misleading customers about the speed of its transfers and for not adequately compensating customers for late transfers. Despite these challenges, Wise has continued to grow, with the company reporting a 39% increase in revenue in 2020 and a 57% increase in revenue in the first half of 2021.
- The allegations against Wise raise serious concerns about the company’s commitment to promoting competition and protecting consumer rights in the money transfer market. As the financial technology sector continues to grow, companies must operate transparently and encourage competition to serve consumers’ interests best. Therefore, the potential investigation by the CMA will be crucial in determining whether Wise’s conduct has breached competition law and its impact on the money transfer market.
- In conclusion, Wise, a $6.6 billion Fintech company, has accused Atlantic Money, a more miniature foreign exchange service, of undermining competition in the money transfer market. Atlantic Money made this allegation in a letter to the U.K.’s competition watchdog, the Competition and Markets Authority, accusing Wise of unfairly removing Atlantic Money from the price comparison section of its website and refusing to include it on Exiap. This foreign exchange fee comparison site also belongs to Wise. The letter states that Wise’s conduct was “harmful to competition across the U.K. and E.U. and, we would submit, ultimately results in higher fees for end consumers.” Wise has responded to these allegations, stating that the removal of Atlantic Money was due to “operational reasons,” The company is proud to have the comparison tool on its website and is not afraid to list cheaper competitors. The letter from Atlantic Money could be the start of a probe investigating whether Wise’s conduct breaches competition law.
