Bank of America froze our account because we use TransferWise
TL;DR Bank of America feels threatened by TransferWise and penalized us for using them.
Paperspace is a semi-remote company with employees spread around the world. Several years ago, we discovered TransferWise as an easy and affordable way to make international payments. We have since been using the tool to pay all remote employees. For those of you that are not familiar with TransferWise, it’s a UK based startup with the mission of lowering the costs associated with international money transfers. The crux of this problem is that banks use a fake exchange rate (made up by the bank) which costs companies collectively billions of dollars. It’s a dubious practice which IMO should be regulated but that’s a topic for a separate conversation. In any case, TransferWise is loved and trusted by thousands of organizations like ours and is backed by leading investors such as Richard Branson, Andreesen Horowitz etc. They have over 1,000 employees and move over $4B per month. In other words, they are legitimate.
So, what happened? My guess is, Bank of America decided it didn’t like that using a competitor and decided to freeze our account. We lost all ability to transfer money and had to scramble to pay vendors, make regular payroll (in the US) etc. To get up and running again, we were instructed to fill out a 16 page form on paper about what our business does that we had to wait up 48 hours to regain access to our money. We are in the midst of this process. We were on the phone all day yesterday and were told there is no way to expedite this process and that we would just have to wait until they got around to validating the information in the form.
I wanted mention this here as a warning to all TransferWise users and to hopefully draw attention to this nefarious practice such that banks stop the nonsense immediately.
Happy to answer any questions.