[jotm]

How does it work? I wanted to use them once, but it was the first time I heard about them and their site doesn't explain anything.

If anything, it looks shady - "outsmart your bank, use us, we do it super cheap, promise!" but no explanation of how it actually works...

[NearAP]

From their website (step 3 of how it works)

TransferWise converts your money at the mid-market rate and matches you with people sending in the other direction. That's why it costs so little.

My understanding - after you've given the money you want to transfer to TransferWise, they find someone in your destination country who wishes to transfer money to the country where you are (kind of like a swap). This way, they cut off the banks and their fees and charge you a lower fee.

[jotm]

That's how I understood it, but then I thought "what if there's no one in that country?" Do they use their own funds or does the recipient wait several weeks.

I imagine it's the former, but at the time I just used SWIFT - rather expensive, but guaranteed to work everywhere.

[tim333]

It works by them having $90m in VC funding from people like Richard Branson and Peter Thiel which they then use to subsidise the super cheap transfers with the aim of growing big.

[linuskendall]

It works well, you initiate a bank account transfer from one country (denominated in say USD) and in a few days your recipient receives it as a deposit in their bank account in their local currency. In between TransferWise keeps you updated with status via e-mail and on the website.