Money transfer firm Wise hiked its guidance for the full year today as rising interest rates cause a surge in the amount of cash it is making on its customer deposits.
The London-listed fintech said the net income it was making on its customer balances roared up 148 per cent on the previous quarter to £43.5m, pushing total income up to £268.7m.
Revenues for the firm also bumped upwards six per cent to £225.2m despite a dip in cross border transactions on the previous quarter.
Wise chiefs revised their outlook for the year on the back of the bumper earnings and said they were now expecting to post total income growth for the year of 68-72 per cent, up from 55-60 per cent previously.
Kristo Käärmann, CEO and co-founder of Wise, said the firm was now also looking to share the profits reaped from rate hikes with customers.
“As interest rates increase, our customers expect a return on the balances they hold with us, and we intend to share much of the benefit of higher rates with customers,” he said in a statement.
“This quarter we launched ‘Interest’ within our Assets product in the UK; a whole new way for our customers to hold their money and earn a return. I’m also pleased that for the third consecutive quarter, more than 50% of cross-border payments were completed instantly.”
Bossed added that the firm was “highly profitable and cash generative” and were continuin to “invest in products and infrastructure for future growth”.
The results come after a bumper period of growth in which it revenues have grown 50 per cent on the back of a boom in customers pinging cash overseas. Shares in the firm are trading up around 111 per cent from a June low.
Wise has been plagued by troubles and regulatory scandals in the past 12 months, however, with chief Kristo Kaarmann falling under the scrutiny of regulators over a 2017 tax scandal. The Financial Conduct Authority is currently conducting an investigation to deem whether he is a ‘fit and proper’ person to be running the firm.