Thriving fintech startup TransferWise has announced that it has secured an FCA license for regulated investment activities. This way it will be able to offer retail investment services in the UK.
TransferWise moved into banking in 2018. It offered a “borderless” multi-currency account with a debit card. During last month, the fintech announced that these accounts now hold £2 billion in deposits.
Read the full article here: TransferWise hits £2 billion in customer deposits
TransferWise CEO and co-founder Kristo Käärmann said the problem the platform’s users have had lately is finding a way to make a return on their cash. He added that TransferWise wanted to take a different approach to traditional banks, which lend out customer deposits and charge interest.
While having all that on their minds, Transferwise’s execs. decided to offer its 8M customers a service that lets users of the account invest passively in investment funds from third-party providers. TransferWise’s investment product will be protected by FSCS of a value up to £85,000, however as with all investments, their value can rise and fall.
“It’s not like if you put money into a savings account in a bank, money magically grows there,” Käärmann told CNBC. “It’s still going to be invested in something.”
TransferWise said it expects to launch its first investing feature in the next 12 months. Though the firm is starting with the U.K., it hopes to also roll the product out internationally later down the line.