Wise share price drops after HSBC says it wants to “attack” retail payments market with new forex app 

HSBC Holdings is gearing up to launch an international payments app, Zing, in a direct challenge to fintech giants like Revolut and Wise, which have amassed large retail customer bases by providing cost-effective foreign exchange services. 

Initially available in the UK, HSBC, Europe's largest bank, plans to extend Zing's services to other regions in the coming months, targeting the rapidly growing market catering to affluent consumers. 

Zing will soon be accessible on Apple's App Store and Alphabet's Google Play and will be open to non-HSBC customers as the bank aims to “attack” the global retail payments market, according to Nuno Matos, CEO of HSBC's global wealth and personal banking business. Matos stated that the sign-up process for new users would take approximately three minutes. 

The executive outlined HSBC’s expectations for the new app in a recent interview cited by Bloomberg:

“Zing has a global ambition. We want to establish ourselves as a global platform for international payments, which ties perfectly with our international payments strategy for HSBC and you should see us very soon in Asia, in the Middle East and in EU markets.”

This move underscores how major global financial institutions are positioning themselves to compete against a wave of startups that have expanded rapidly in the past decade, offering a range of services from cross-border payments to savings accounts and investment products on mobile platforms. At the time of writing, HSBC’s shares on the London Stock Exchange were down 0.7% at 626.00p. Other UK banks and HSBC rivals also saw their stocks trade lower — the Barclays share price was down 1.71% at 152.62p, while NatWest Group shed 1.14% of its value at 218.10p.

Wise share price: Unveiling of HSBC’s Zing drops Wise shares by close to 8% on Tuesday 

The announcement had a notable impact on the Wise share price, causing a decline of up to 7.6% on Tuesday, marking the largest intraday drop since April. Wise, which went public in 2021, witnessed a more than 50% surge in its stock last year. Revolut, boasting over 26 million users, anticipates a nearly 70% increase in revenue to $2 billion in 2023. 

While HSBC already provides a product called Global Money offering fee-free currency services to existing customers, Zing’s launch marks a more comprehensive, strategic expansion. Since its launch in 2020, Global Money has garnered hundreds of thousands of users, processing transactions totaling approximately $11 billion in 2022. 

Matos envisions Zing attracting users who may then choose to conduct more of their banking with HSBC, aligning with the bank's initiative launched last year to establish itself as the premier financial institution for internationally mobile customers. As per Nuno Matos: 

“It’s a bold move for us. This is HSBC playing outside of its traditional perimeter of customers, and really attacking, if you want, of taking advantage of a contingent, which is big, is growing, looks like us, and it’s here for us.” 

Wise share price forecast: Analysts see stock mostly sideways in 2024 

According to 6 analysts surveyed by TipRanks that offered 12-month Wise share price targets, the consensus forecast for WISE stock stands at 806.67p — a potential 2.16% upside from its current price as of January 3, 2024. 

The highest listed Wise stock price forecast on the platform is 983.00p, while the lowest stands at 590.00p. Of the 6 analysts surveyed, three offered a Buy rating on WISE stock, while 2 had it as a Hold, and one gave it a Sell rating. 

At the time of writing on Wednesday, Wise shares, which trade on the London Stock Exchange under the ticker WISE, were close to 2.7% down on the day at 824.00p, continuing their decline after having closed at 846.40p on Tuesday. 

Wise shares are down over 6% in trading over the past 5 days. Other banking and finance stocks have also seen declines this week — the Lloyds share price, for instance, is down 1.33% on the day and is currently trading at 47.46p.