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The company added that its initial plan is to launch Assets for the business and personal customers in the United Kingdom.
Wise, a British Fintech firm, launched a feature called Assets on Tuesday, the feature gives users a chance to invest in stocks using different currencies while spending on their stocks at the same time. This new feature, Assets, provides customers with an opportunity to make investments in iShares World Equity Index Fund which is managed by BlackRock. The fund keeps track of a pool of 1,557 major global public companies. Some of the fund’s holdings include popular companies such as Apple Inc (NASDAQ: AAPL), Google LLC (NASDAQ: GOOGL), and Amazon.com Inc (NASDAQ: AMZN).
With a Wise debit card, users are allowed to spend up to 97% of the amount they’ve saved in their accounts. Assets also allow users to transfer funds overseas using different currencies. The main idea is to enable customers to hold their money in stocks while being able to spend it in real-time if they so wish.
Kristo Käärmann, CEO and co-founder at Wise, was quoted saying that holding money in multiple currencies is difficult to manage efficiently. However, he added that despite the challenge, Assets has a great solution for that whereby customers will have a chance of earning a return on their investment with the company. Not only that, the customers will be able to transact using multiple currencies.
Wise revealed that they will be holding 3% of their customer’s investments as a “buffer”. The held cash will cushion customer balances from dipping further into the negative territory in the event that a large market fluctuation occurs.
The company added that its initial plan is to launch Assets for the business and personal customers in the United Kingdom. However, the company’s long-term plan is rolling out Assets to the larger Europe in the future.
Wise, previously called TransferWise, began business as an alternate financial platform offering cheaper monetary exchange services. The company has since grown and expanded its array of products including debit card-linked accounts that allows users to transact on multiple currencies. After being granted authorization by U.K regulators last year, Wise has begun the rolling out of the investment accounts. Wise revealed that its global total customer balances amount to £4.3 billion which is equivalent to $5.9 billion.
The investing feature that Wise is rolling out is not like what is offered by your ordinary fintech platforms which allow investors trade different stocks those platforms offer without paying any commission fees. With the new product, Assets, Wise users can use their holdings to pay for hundreds of stocks that they’ll be exposed to. Also, users can make cross-border transactions using different currencies.
Since it’s a business like any other, Wise charges 0.55% annual fee and 0.15% fund fee on customer’s assets, taken each month and in arrears. Assets’ launch comes after a surge of retail investors in the market. The surge resulted in the need and demand for alternative ways for customers to earn on their investments.