TransferWise is an Electronic Money Institution and is required by law to keep your money safe by storing it in a low-risk financial institution (e.g. bank account). For example, for UK and European customers, your money is stored and safeguarded securely in our Barclays accounts in the UK.
This means that in the event that TransferWise were to become insolvent, your money is unaffected and will be refunded to you within 10 working days.
The main difference with the protection offered by TransferWise in comparison with a bank is that, because TransferWise is an Electronic Money Institution and not an official deposit taking Banking Institution, your money is not guaranteed by Financial Services Compensation Scheme (FSCS).
This means that in the event that the bank itself where we store the funds were to become insolvent, you may not be guaranteed the return of your funds, whereas you are normally guaranteed up to a value of 75-85k GBP with FSCS.