{"url_path":"/sec/wse/10-k/2026/item-5","section_key":"item-5","section_title":"Item 5 Operating and Financial Review and Prospects","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-25","source_url":"https://www.sec.gov/Archives/edgar/data/2099039/0001193125-26-282911-index.html","accession_number":"0001193125-26-282911","cik":"0002099039","ticker":"WSE","issuer_name":"Wise Group plc","edgar_url":"https://www.sec.gov/Archives/edgar/data/2099039/0001193125-26-282911-index.html","primary_entity_key":"0002099039","primary_entity_name":"Wise Group plc"},"word_count":9137,"has_tables":true,"body_markdown":"Item 5. Operating and Financial Review and Prospects\n\nYou should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes thereto appearing elsewhere in this Annual Report. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should review the section titled “Risk Factors” for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis, as well as the section titled “Cautionary Statement Regarding Forward-Looking Statements.” The accompanying review, including all periods presented, have been prepared under U.S. GAAP.\n\nThis section of our Annual Report on Form 20-F discusses our financial condition and results of operations for the financial year ended March 31, 2026 compared to the financial year ended March 31, 2025. For a discussion of results for the financial year ended March 31, 2025 compared to the financial year ended March 31, 2024, see “Item 5. Operating and Financial Review and Prospects” within our registration statement Form 20-F filed with the SEC on April 17, 2026.\n\nA. Operating Results\n\nOverview\n\nFifteen years ago, we set out with a simple but visionary goal that became the mission for Wise: money without borders. It should not be more expensive or less convenient to use your money in another country. People and businesses should always know what each transaction actually costs.\n\nGuided by this mission, we started with fixing overseas transfers and went on to build an international account for a truly borderless experience for people and businesses using their money. An increasing number of banks and online platforms now offer our products to their customers via Wise Platform.\n\n \n\n65\n\n##### Table of Contents\n\nTo power this borderless experience, we have built an innovative infrastructure for the world’s money—one that makes payments instant, convenient, low-cost and transparent. In the year ended March 31, 2026, this infrastructure powered payments across more than 40 currencies, moved $243.5 billion across borders for 18.9 million people and businesses, and saved them approximately $3.3 billion along the way, based on our estimates of per transaction savings calculated by reference to publicly available foreign exchange rates and fees of alternative banks and payment providers. As of March 31, 2026, our customers’ holdings across their cash and Wise Assets balances equaled $39 billion, reflecting the trust we have built with our customers. This included $9.0 billion held with Wise Assets (i.e. assets under custody), an account feature that helps our customers earn a return on their money while ensuring it’s still conveniently accessible.\n\nOur Business Model\n\nWe have achieved strong growth and operating results since we started. Our net revenue was $2.5 billion for the financial year ended March 31, 2026, an increase of $0.4 billion over the financial year ended March 31, 2025. Our net income was $498.7 million for the financial year ended March 31, 2026, a decline of $51.6 million over the financial year ended March 31, 2025, primarily driven by the reduction in our average cross-border take rate by 0.06 percentage points, from 0.58% to 0.52%, reducing net revenue growth compared to volume growth. We believe these reductions in cross-border take rates, as a result of price reductions and mix effect, have supported growth in cross-border volumes and active customers by making our products and features more attractive to customers. This was accompanied by increased investment in headcount, servicing, third-party spend and outsourced services, reflecting in part our preparation for the Reorganization Transaction and commencement of operations as a U.S. listed company, as well as continued investment in our infrastructure, marketing and product development.\n\nWe report our revenue based on the nature of the underlying services provided, which are consistent across all three product offerings. Our transaction revenue streams consist of: (i) revenue from cross-border payment services, including money transfers, currency conversions and account services; (ii) card revenue refers to debit card services and mainly comprises interchange and other card usage fees; and (iii) other revenue from account top-ups, same-currency transfers, one-time fee charged to Wise business customers, fees earned for the provision or replacement of physical cards and Wise Assets management fees. We also generate interest income from interest we earn on customer funds. Separately, a portion of interest or cashback is paid back to customers, where regulations permit, including to customers in Brazil, the European Economic Area and the United States. Such interest or cashback, even where permitted, is not paid on all currency balances, and in the United States, is only paid where customers opt in to the product. See “ —Key Trends and Factors Affecting Our Performance—Interest Rates and Interest Expense on Customer Balances and Liabilities” for additional information on interest expense on customer liabilities.\n\nWise Account, Wise Business and Wise Platform generate revenue across these net revenue streams. For example, both Wise Account and Wise Business customers generate cross-border transaction revenue when they send money internationally or convert currencies, and both generate card revenue when they use their Wise Cards. Similarly, Wise Platform partners’ customers generate cross-border transaction revenue and may generate card revenue when they access our services. We evaluate and manage our revenue principally based on these net revenue streams rather than by individual product offerings.\n\nWise Account is our global solution for people who want to send, spend and earn with more speed, transparency and convenience. In the financial year ended March 31, 2026, Wise Account served 18.0 million active personal customers across the world, up from 14.9 million in the prior year. Personal customer balances also grew significantly, up 38% to $18.8 billion at March 31, 2026 compared to March 31, 2025. Wise Account primarily generates revenue from cross-border transactions, with personal cross-border take rates averaging 0.57% for the financial year ended March 31, 2026 and 0.63% for the financial year ended March 31, 2025.\n\nWise Business is our business-focused product offering tailored to enable businesses to grow and operate internationally. For the financial year ended March 31, 2026, Wise Business had 850 thousand active business\n\n \n\n66\n\n##### Table of Contents\n\ncustomers, including an average of 29 thousand new businesses joining per month during this period. Business customer deposits held totaled $11.2 billion at March 31, 2026 as compared to $8.4 billion at March 31, 2025. We continue to see growth in volume with businesses having sent or spent a total of $5.9 billion on average every month in the financial year ended March 31, 2026, growing our business cross-border volumes by 42% since the financial year ended March 31, 2025. Wise Business primarily generates revenue from cross-border transactions, with business cross-border take rates averaging 0.39% for the financial year ended March 31, 2026 and 0.44% for the financial year ended March 31, 2025.\n\nBoth Wise Account and Wise Business generate revenue primarily from fees we charge customers for transfers, conversions, card transactions, account set-up and use of Wise Assets products.\n\nWise Platform is our global payment infrastructure for banks, financial institutions and enterprises around the world. Wise Platform provides these organizations with the capabilities to serve their customers with a world-class experience to send, receive, hold and spend money cross-border instantly, reliably, securely and cost-effectively. The value of our infrastructure has been clearly demonstrated by some of the leading global banks choosing Wise as a partner for their cross-border payment needs. Wise Platform generates revenue from end customers, both personal and business, who use our services, such as from convenience fees charged in addition to the applicable transaction fees on cross-border transfers as well as from the fees we charge banks, financial institutions and enterprises for integration with our infrastructure through the API.\n\nFor each of the financial years ended March 31, 2026 and March 31, 2025, Wise Business represented approximately one quarter of transaction activity for the periods, with Wise Account representing the remaining balance. While a distinct product offering that has grown significantly in recent years, Wise Platform does not yet generate a material percentage (i.e., it currently generates less than 10%) of the Group’s overall transaction activity and as such is included within both Wise Account and Wise Business activity.\n\nWe are committed to fueling growth through scaled investments that are strategic and return-led. Over the medium term, we plan to increase our annual spend to support Wise’s growth, including increased investment in marketing, hiring, infrastructure, servicing and products to accommodate a growing customer base and to expand into our total addressable market. Investing in enhancing the awareness of our brand and our products will ensure our growth remains strong amidst a growing and increasingly competitive digital-first money transfer market.\n\nKey Operating Metrics\n\nIn addition to the measures presented in our consolidated financial statements, we regularly monitor certain key operating metrics, including cross-border volume, cross-border take rate and active customers. We use these metrics to evaluate our business and trends, measure our performance, prepare financial projections and make strategic decisions.\n\n \n\n \n•\n \n\nCross-border volume is calculated as the volume of transactions, measured in U.S. dollars, where the source currency and target currency are different. We believe cross-border volume is a meaningful indicator of our business performance as our revenue is primarily generated on fees from cross-border transactions, calculated as a percentage of cross-border transaction volumes.\n\n \n\n \n•\n \n\nCross-border take rate is calculated as cross-border revenue divided by cross-border volume. We believe cross-border take rate is a meaningful indicator of our business performance as it describes the percentage of revenue collected on the volume of transactions processed.\n\n \n\n \n•\n \n\nActive customers represent the total number of unique customers who have completed at least one cross-border transaction in a given reporting period. We believe active customers is a meaningful indicator of our business performance as it is a key driver for the growth in our cross-border volume.\n\nThese metrics may not be comparable to similar performance measures used by our competitors.\n\n \n\n67\n\n##### Table of Contents\n\nAcross these key operating metrics, we monitor the split between personal and business customers. We consider this split to be useful in monitoring key trends underpinning business performance.\n\nIn the financial year ended March 31, 2026, our cross-border volume was $243.5 billion, up from $185.2 billion in the financial year ended March 31, 2025. Cross-border volume was split between personal cross-border volume of $173.0 billion and business cross-border volume of $70.5 billion, up from $135.7 billion and $49.5 billion in the financial years ended March 31, 2026 and 2025, respectively.\n\nGrowth in cross-border volume over these periods was underpinned by growth in active customers, which increased from 15.6 million in the financial year ended March 31, 2025 to 18.9 million in the financial year ended March 31, 2026. This was split between active personal customers, which grew from 14.9 million to 18.0 million, and active business customers which grew from 0.7 million to 0.9 million.\n\nThe growth in cross-border volume and active customers has been supported by a reduction in our cross-border take rates, making our products more attractive to our customers. Our cross-border take rate decreased from an average of 0.58% for the financial year ended March 31, 2025 to 0.52% for the financial year ended March 31, 2026, with personal customer cross-border take rates decreasing from 0.63% to 0.57% and business customer cross-border take rates decreasing from 0.44% to 0.39%.\n\nKey Trends and Factors Affecting Our Performance\n\nGlobal and Regional Macroeconomic Factors\n\nGlobal and regional economic as well as political factors, including inflation, currency fluctuations, immigration, conflict, global travel, and regulatory changes, affect demand for our services and product offerings. These factors, particularly currency appreciation or depreciation, shifts in migration patterns or immigration policy, and changes in digital adoption, can alter transaction timing and volume, and customer numbers; although the increasingly global nature of our business with diversified revenues across regions somewhat mitigates this risk.\n\nCustomer Growth\n\nOur long-term growth is primarily driven by our ability to attract new customers in a competitive landscape, including through our Wise Platform product offering; the market for our products is fragmented and characterized by changing customer expectations, evolving regulatory standards and frequent launches of new products and features. Key competitors include global banks, new financial institutions or platforms, legacy foreign exchange businesses and payment infrastructure providers.\n\nWe attract Wise Account and Wise Business customers through our competitive pricing model, our speed of transactions and the transparent service we provide. As the benefits of Wise have become more widely known, banks have been incentivized to partner with us, leveraging our infrastructure to provide these benefits for their customers, through Wise Platform. This means that current competitors can turn into partners, and their customers can turn into our customers, as we continue to invest into our infrastructure to maintain our competitive advantage. Our long-term aim is for Wise Platform to account for more than 50% of Wise’s cross-border volume. See “Item 4. Information on the Company—B. Business Overview—Our Growth Strategy.”\n\nOur transparent and competitive pricing is evident through our latest cross-border take rate. Our cross-border take rate, which represents cross-border revenue across all customer activity as a portion of cross-border volume, was on average 0.52% for the year ended March 31, 2026, a reduction of 0.06% from the year ended March 31, 2025. We are continuously seeking to expand our customer base through our investment in infrastructure, innovating both existing and new products, and strengthening our trusted financial services for customers with cross-border financial needs. Our customer growth is dependent on our ability to maintain existing and obtain new licenses, as well as maintaining capacity to onboard new customers.\n\n \n\n68\n\n##### Table of Contents\n\nFee Structure\n\nOur commitment to a return-led approach means we continue to pass on efficiency gains and sustainable reductions in our costs to our customers as price reductions, driving our long-term growth and reducing our take rate. Conversely if our costs increase we may need to increase the fees charged to customers which could make us less competitive.\n\nInterest Rates and Interest Expense on Customer Balances and Liabilities\n\nInterest income on customer balances is affected by the amount of customer deposits we hold and market interest rates. We are also exposed to changes in interest income resulting from movements in interest rates on our financial assets, including cash and cash equivalents and short-term investments. Our earnings are also impacted by the amount of interest income we return to our customers. While our interest framework has historically aimed to ultimately return to our customers 80% of interest income yield greater than 1%, we have not been able to do so across all jurisdictions. We returned 45% of this target in the financial year ended March 31, 2026, with the remainder unable to be returned due to several reasons, including: regulatory restrictions applicable to deposits in certain jurisdictions that prevent the payment of interest or cashback (such as the United Kingdom, which made up two-thirds of the shortfall); the use of currencies for which we do not yet pay interest or cashback; and regulatory requirements in certain geographies.\n\nWe have paid interest at variable rates to customers on balances held in their accounts in the following jurisdictions and currencies:\n\n \n\n \n•\n \n\nin Brazil, on balances in Brazilian Real;\n\n \n\n \n•\n \n\nin the European Economic Area, on balances in Euro, U.S. dollar and pound sterling; and\n\n \n\n \n•\n \n\nin the United States, on eligible balances in U.S. dollar, Euro and pound sterling.\n\nAs we resolve any regulatory hurdles or otherwise increase the portion of interest income yield that we return to our customers (including if a greater percentage of customers opt-in to receive interest), our interest expense on customer liabilities may grow.\n\nInvestments in Infrastructure and Marketing\n\nWe plan to continue making significant uncapitalized investments in our infrastructure, products and marketing over the upcoming years. These investments include the expansion of our licenses and connections to banks and payment systems; enhancements to our Wise Account and Wise Business products offering and brand marketing. In line with our financial model, we expect these investments to fuel future growth in customers, volume and efficiencies, thereby creating further capacity for investment. Our cost base is affected by the need to maintain regulatory compliance across numerous jurisdictions in which we operate, which requires continued investment in our infrastructure, servicing, technology and products.\n\nHeadcount Growth\n\nWe expect to continue to grow our headcount to support the expansion of the business, including product development, market expansion, regulatory and risk management capabilities and customer operations. The rate of expansion is assessed on an ongoing basis taking into account factors such as the growth of our business, productivity, automation, use of outsourced services, operating leverage, regulatory requirements, talent availability and macroeconomic conditions, each of which may cause variability in our hiring plans and, as such, we may adjust the pace of hiring accordingly.\n\nPublic Company Costs\n\nWe expect to continue to incur additional costs associated with operating as a listed public company. We anticipate that these costs will relate to personnel, legal, consulting, audit and other expenses. Of particular note,\n\n \n\n69\n\n##### Table of Contents\n\nthe Sarbanes-Oxley Act, as well as rules adopted by the SEC and Nasdaq, require U.S. public companies to implement and adhere to specific corporate governance practices, rules and regulations which lead to legal, regulatory and financial compliance costs.\n\nCurrency Fluctuations\n\nCurrency fluctuations can influence customer behavior, cross-border volumes and pricing.\n\nIn addition, we report our results in U.S. dollars while a share of our revenues, expenses, assets, liabilities and equity is denominated in other currencies; as a result, movements in exchange rates affect our reported performance.\n\nWhere possible and cost effective we mitigate exposure by matching assets and liabilities by currency and, where appropriate, using derivative financial instruments to mitigate the impact.\n\nShare Price\n\nIncome tax expense is impacted by tax deductions generated from share based payments. Therefore, movements in share price could cause fluctuations in our net income.\n\nTransaction Frequency\n\nWe have historically experienced some degree of higher transaction frequency, primarily in card revenue, as customers travel and send gifts for regional and global holidays, which resulted in higher active customer numbers in the first and second financial quarters. We anticipate that this trend in card revenue will continue, but the impact on our financial results is limited considering the proportion of net revenue that is card revenue, which was 16% for the financial year ended March 31, 2026.\n\nComponents of Operating Results\n\nTransaction Revenue\n\nRevenue from Cross-Border Payments\n\nWe generate revenue primarily from cross-border payment services, including money transfers, currency conversions and account services. Applicable fees vary depending on several factors, including the currency route, transaction size, transaction type and payment method. A contract is established between the customer and Wise upon customer account opening or initiation of a money transfer. Customers formally accept the terms and conditions of the relevant service via Wise’s website or app. Revenue recognition occurs upon performance obligation fulfillment. For money transfers, this happens when funds reach the recipient. For currency conversions, revenue is recognized when a customer’s balance is converted to a different currency within their account. The time required to process the payment to the recipient, and therefore to satisfy our performance obligations, depends on the processing time our banking partners require to deliver funds to the recipient. As such, the revenue is deferred until the funds are delivered.\n\nRevenue from Card\n\nCard revenue primarily consists of interchange fees and card usage fees. A contract is formed between the customer and Wise when a virtual or physical card becomes available for use, enabling payments and withdrawals. Card revenue is based on the agreed terms and conditions. Revenue recognition is tied to a single performance obligation, satisfied upon transaction capture.\n\n \n\n70\n\n##### Table of Contents\n\nRevenue from Other Services\n\nOther revenue streams primarily consist of:\n\n \n\n \n•\n \n\nAccount Top-Ups and Same-Currency Transfers: Revenue is generated from top-ups of account balances or transfers to recipients using the same currency, which we refer to as “same-currency transfers.” Revenue recognition occurs upon transaction completion for top-ups and upon delivery of funds to the recipient for transfers.\n\n \n\n \n•\n \n\nBusiness Account Setup Fees: A one-time fee is charged to Wise Business customers in certain regions upon account setup. Revenue is recognized over time, aligning with the expected duration of account usage.\n\n \n\n \n•\n \n\nPhysical Card Provision/Replacement Fees: Fees are earned for the provision or replacement of physical cards. Revenue is recognized over time, corresponding to the expected card service period (typically the card’s lifespan).\n\n \n\n \n•\n \n\nWise Assets Management Fees: We generate revenue from our multi-currency investment feature, Wise Assets, by charging fees based on the daily value of assets held under custody. Revenue is accrued daily and recognized over time, reflecting the period we provide services to our Assets customers. We act as an agent on behalf of the customers and do not retain control nor benefit from the assets, thus it does not recognize the financial assets and the respective liabilities for the assets.\n\nInterest Income on Customer Balances\n\nInterest income on customer balances is earned from holding customer funds as cash and cash equivalents or investing them into highly liquid permitted financial assets. These amounts are recognized in the Consolidated Statement of Comprehensive Income of our consolidated financial statements using the effective interest rate method.\n\nInterest Expense on Customer Liabilities\n\nInterest expense on customer liabilities is the interest expense payable to customers for holding eligible balances in their accounts with Wise. These amounts are calculated as a percentage of those eligible balances and provided as either cashback or interest depending on the jurisdiction. These amounts are recognized in the Consolidated Statement of Comprehensive Income as “Interest expense on customer liabilities” in the period for which the customer receives the benefit.\n\nCost and Expenses\n\nTransaction Expense\n\nTransaction expense (excluding depreciation and amortization) consists of the costs incurred by Wise in processing and settlement of transactions as well as providing debit card services. This includes:\n\n \n\n \n•\n \n\nbanking and other fees, net of applicable rebates, incurred in processing customer transfers, card transactions and the costs of providing cards to customers;\n\n \n\n \n•\n \n\nnet foreign exchange costs generated due to customer transactions, including the costs related to the difference between the published mid-market rate offered to customers and the rate obtained by the Group in acquiring currency. Net foreign exchange differences are also incurred from the revaluation of customer balances at period end; and\n\n \n\n \n•\n \n\nother product costs including product losses that are directly generated from customer transactions, such as chargeback losses, fraud charges, as well as taxes directly attributable to customer activity.\n\nTransaction and Credit Losses\n\nTransaction and credit losses consist primarily of allowance for credit losses in relation to accounts receivable.\n\n \n\n71\n\n##### Table of Contents\n\nTechnology and Development\n\nTechnology and development expenses consist of employee-related expenses for our engineering and product teams, including salaries, benefits and share-based compensation expenses, professional services fees and costs for software subscription services dedicated for the use by our technology teams, cloud infrastructure costs as well as costs of other company-wide technology tools, including AI solutions.\n\nServicing\n\nServicing includes costs to provide customer onboarding and support, payment operations and compliance activities, including financial crime prevention and sanctions screening and monitoring. These costs include employee-related expenses associated with our servicing staff, including salaries, benefits and share-based compensation expenses; outsourced services providers; and technology and AI solutions used by servicing teams.\n\nMarketing and Sales\n\nMarketing and sales expenses consist primarily of advertising and customer acquisition costs incurred to attract new customers, including external brand and customer acquisition expenses and employee-related expenses associated with our marketing and sales people, principally salaries, benefits and share-based compensation expenses. Marketing and sales expenses also include promotions, costs for software subscription services dedicated for use by our marketing and sales teams, and outsourced service providers contracted for marketing purposes.\n\nGeneral and Administrative\n\nGeneral and administrative expenses consist of employee-related expenses for finance, legal, compliance, risk, people, workplace, and other administrative teams, as well as leadership functions including salaries, benefits and share-based compensation expenses. General and administrative expenses also include professional services fees, subscriptions, office expenses, indirect taxes, depreciation, amortization and other corporate expenses.\n\nOther Income/(Loss), Net\n\nOther income/(loss), net consists primarily of losses on the sale or maturity of available-for-sale debt securities, interest expense related to the Revolving Credit Facility, Euro Medium Term Note and interest income earned from our corporate short-term financial instruments.\n\nIncome Tax Benefit/(Expense)\n\nWe are subject to corporate taxation in the United Kingdom and our wholly owned subsidiaries are subject to corporate taxation either in the United Kingdom or in the relevant foreign jurisdiction where the subsidiary is a tax resident.\n\nThe deferred tax asset is primarily generated in the United Kingdom and the United States, and arises from unexercised share options and other temporary differences.\n\nForeign Currency Fluctuations\n\nWhile we incur foreign exchange rate movement from holding assets and liabilities in different currencies and guaranteeing customers a foreign exchange rate on their international transfers for a short period of time, we actively monitor this foreign exchange risk and exposures are managed through a combination of natural hedging and derivative financial instruments.\n\n \n\n72\n\n##### Table of Contents\n\nOur operating subsidiaries’ financial results are translated to U.S. dollars for reporting purposes. Income and expenses are translated at monthly average exchange rates, assets and liabilities are translated at the exchange rate at the period end.\n\nAs a result of the translations described above, our results are impacted by fluctuations in foreign exchange rates.\n\nResults of Operations\n\nComparison of the Financial Years Ended March 31, 2026 and 2025\n\nThe following table sets forth our results of operations for the financial years ended March 31, 2026 and 2025\n\n \n\n \n  \nYear ended March 31,\n \n  \n \n \n  \n \n \n\n \n  \n2026\n \n  \n2025\n \n  \nVariance\n \n  \nVariance %\n \n\n(in million)\n  \n \n \n  \n \n \n  \n \n \n  \n \n \n\nTransaction revenue\n\n  \n$\n1,893.6\n \n  \n$\n1,546.3\n \n  \n$\n347.3\n \n  \n \n22\n% \n\nInterest income on customer balances\n\n  \n \n806.1\n \n  \n \n758.3\n \n  \n \n47.8\n \n  \n \n6\n% \n\nInterest expense on customer liabilities\n\n  \n \n(196.9\n) \n  \n \n(205.7\n) \n  \n \n8.8\n \n  \n \n(4\n)% \n\nNet revenue\n\n  \n$\n2,502.8\n \n  \n$\n2,098.9\n \n  \n$\n403.9\n \n  \n \n19\n% \n\nOperating expenses:\n\n  \n\n  \n\n  \n\n  \n\nTransaction expense\n\n  \n \n(513.6\n) \n  \n \n(378.0\n) \n  \n \n(135.6\n) \n  \n \n36\n% \n\nTransaction and credit losses\n\n  \n \n(13.9\n) \n  \n \n(11.6\n) \n  \n \n(2.3\n) \n  \n \n20\n% \n\nTechnology and development\n\n  \n \n(434.3\n) \n  \n \n(314.1\n) \n  \n \n(120.2\n) \n  \n \n38\n% \n\nServicing\n\n  \n \n(396.6\n) \n  \n \n(287.5\n) \n  \n \n(109.1\n) \n  \n \n38\n% \n\nMarketing and sales\n\n  \n \n(171.8\n) \n  \n \n(106.1\n) \n  \n \n(65.7\n) \n  \n \n62\n% \n\nGeneral and administrative\n\n  \n \n(381.9\n) \n  \n \n(273.4\n) \n  \n \n(108.5\n) \n  \n \n40\n% \n\nTotal operating expenses\n\n  \n \n(1,912.1\n) \n  \n \n(1,370.7\n) \n  \n \n(541.4\n) \n  \n \n39\n% \n\nOperating income\n\n  \n$\n590.7\n \n  \n$\n728.2\n \n  \n$\n(137.5\n) \n  \n \n(19\n)% \n\nOther income/(loss), net\n\n  \n \n69.7\n \n  \n \n(10.7\n) \n  \n \n80.4\n \n  \n \n(751\n)% \n\nIncome before tax\n\n  \n$\n660.4\n \n  \n$\n717.5\n \n  \n$\n(57.1\n) \n  \n \n(8\n)% \n\nIncome tax expense\n\n  \n \n(161.7\n) \n  \n \n(167.2\n) \n  \n \n5.5\n \n  \n \n(3\n)% \n\nNet income\n\n  \n$\n498.7\n \n  \n$\n550.3\n \n  \n$\n(51.6\n) \n  \n \n(9\n)% \n\nTransaction Revenue\n\nThe following table summarizes our total transaction revenue:\n\n \n\n \n  \nYear ended March 31,\n \n  \n \n \n  \n \n \n\n \n  \n2026\n \n  \n2025\n \n  \nVariance\n \n  \nVariance %\n \n\n(in million)\n  \n \n \n  \n \n \n  \n \n \n  \n \n \n\nTransaction revenue by nature:\n\n  \n\n  \n\n  \n\n  \n\nCross-border\n\n  \n$\n1,257.0\n \n  \n$\n1,071.7\n \n  \n$\n185.3\n \n  \n \n17\n% \n\nCard\n\n  \n \n391.6\n \n  \n \n280.5\n \n  \n \n111.1\n \n  \n \n40\n% \n\nOther\n\n  \n \n245.0\n \n  \n \n194.1\n \n  \n \n50.9\n \n  \n \n26\n% \n\nTotal transaction revenue\n\n  \n$\n1,893.6\n \n  \n$\n1,546.3\n \n  \n$\n347.3\n \n  \n \n22\n% \n\nCross-Border Revenue\n\nCross-border revenue increased $185.3 million, or 17%, to $1,257.0 million for the financial year ended March 31, 2026, compared to $1,071.7 million for the financial year ended March 31, 2025. This was primarily a result of volume increases with the volume of cross-border transactions increasing 31% from $185.2 billion to $243.5 billion. This volume increase was driven, in part, by an increase of active customers, from 15.6 million to 18.9 million, and lower pricing. Cross-border take rate decreased by an average of 0.06%, from 0.58% to 0.52%, due to price reductions and change in average transaction size (higher amount transactions having a lower take rate).\n\n \n\n73\n\n##### Table of Contents\n\nCard Revenue\n\nCard revenue increased $111.1 million, or 40%, to $391.6 million for the financial year ended March 31, 2026, compared to $280.5 million for the financial year ended March 31, 2025. The increase was primarily a result of a year-over-year growth in card transaction volumes, particularly in the European Union, Australia and United Kingdom.\n\nOther Revenue\n\nOther revenue grew by $50.9 million, or 26%, to $245.0 million for the financial year ended March 31, 2026, compared to $194.1 million for the financial year ended March 31, 2025. The increase was mostly driven by same-currency transfer revenue, which grew $37.2 million in the financial year ended March 31, 2026, primarily driven by growth in same-currency transfer volumes.\n\nInterest Income on Customer Balances\n\nInterest income on customer balances increased $47.8 million, or 6%, to $806.1 million for the financial year ended March 31, 2026, compared to $758.3 million for the financial year ended March 31, 2025. The increase is primarily due to 36% growth in customer account balances to $30.0 billion for the financial year ended March 31, 2026 compared to $22.0 billion for the year ended March 31, 2025. This was offset over this same time period by average interest income yields declining from 3.9% to 3.0% as interest rates on relevant currencies reduced during the period.\n\nInterest Expense on Customer Liabilities\n\nInterest expense on customer liabilities decreased $8.8 million, or 4%, to $196.9 million for the financial year ended March 31, 2026, compared to $205.7 million for the financial year ended March 31, 2025. The decrease is primarily due to the decline in average interest expense paid to customers, which declined from 2.4% to 1.8% in the same period as interest rates on relevant currencies declined during the period. This was partially offset by the growth in the average eligible customer balance, with interest expense paid out on eligible customer balances.\n\nTransaction Expense\n\nTransaction expense increased $135.6 million, or 36%, to $513.6 million for the financial year ended March 31, 2026, compared to $378.0 million for the financial year ended March 31, 2025. Of this movement $102.2 million related to foreign exchange movements, primarily on customer accounts driven by the strengthening of the euro and Australian dollar against the U.S. dollar and pound sterling. From a foreign exchange exposure perspective, this foreign exchange movement is partially offset by unrealized foreign exchange movements in the available-for-sale debt securities, which are recognized in other comprehensive income. The remaining increase was primarily due to increasing transaction volumes, with cross-border volumes increasing 31% the financial year ended March 31, 2025 to the financial year ended March 31, 2026 along with growth in card transaction volumes. These volume increases were offset by scaling of some costs.\n\nTransaction and Credit Losses\n\nTransaction and credit losses increased $2.3 million, or 20%, to $13.9 million for the financial year ended March 31, 2026, compared to $11.6 million for the financial year ended March 31, 2025. The increase was primarily driven by the growth of cross-border transaction volumes which grew 31% in the financial year ended March 31, 2026.\n\nTechnology and Development\n\nTechnology and development expenses increased $120.2 million, or 38%, to $434.3 million for the financial year ended March 31, 2026, compared to $314.1 million for the financial year ended March 31, 2025. As we continue\n\n \n\n74\n\n##### Table of Contents\n\nto invest in our technology, this growth was driven mainly by a combination of a $70.5 million, or 34%, increase in employee related benefit expenses, driven from a 22% increase in average headcount and $37.5 million, or 45%, increase in technology costs across our product infrastructure in order to support increased transactional volumes.\n\nServicing\n\nServicing expenses increased $109.1 million, or 38%, to $396.6 million for the financial year ended March 31, 2026, compared to $287.5 million for the financial year ended March 31, 2025. This was primarily due to average headcount growth of 26%. Additionally we increased uncapitalizable investment in the servicing team and infrastructure, and saw growth in third-party costs, as we continued to outsource the provision of specific elements of our servicing operations allowing us to flex capacity at a lower cost.\n\nMarketing and Sales\n\nMarketing and sales expenses increased $65.7 million, or 62%, to $171.8 million for the financial year ended March 31, 2026, compared to $106.1 million for the financial year ended March 31, 2025. The increase was primarily due to higher advertising spend across our existing paid marketing channels along with headcount increases, with average headcount growth of 42%. The growth in advertising spend included investment in the launch of awareness marketing to build brand awareness in key markets, to fuel long-term growth.\n\nGeneral and Administrative\n\nGeneral and administrative expenses increased $108.5 million, or 40%, to $381.9 million for the financial year ended March 31, 2026, compared to $273.4 million for the financial year ended March 31, 2025. The increase was primarily driven by an increase in outsourced services of $62.4 million, or 111%, partially driven by preparations for the change in primary listing location, as well as growth in regulatory costs and hiring costs as a result of expansion. Employee-related expenses also increased $48.8 million, or 50%, as a result of average general and administrative headcount increasing 31%.\n\nOther Income/(Loss), Net\n\nOther income/(loss), net was $69.7 million income for the financial year ended March 31, 2026 compared to other loss, net of $10.7 million for the financial year ended March 31, 2025, a favorable change of $80.4 million. The change was primarily driven by two factors. First, unrealized foreign exchange gains (losses) on available-for-sale debt securities, arising on portfolios denominated in currencies other than the functional currency of the holding entity, improved from a loss of $42.5 million in the financial year ended March 31, 2025 to a gain of $7.6 million in the financial year ended March 31, 2026. Second, interest income from corporate investments increased from $42.5 million in the financial year ended March 31, 2025 to $63.0 million in the financial year ended March 31, 2026 as a result of growth in cash and cash equivalents which grew 54% over the year, with the increase in cash balances partially offset by the decline in interest rates through the financial year ended March 31, 2026.\n\nIncome Tax Expense\n\nIncome tax expense was $161.7 million for the financial year ended March 31, 2026 compared to an expense of $167.2 million for the financial year ended March 31, 2025. This reduction of $5.5 million, or 3%, relates to a reduction in the tax charge primarily in the United Kingdom as a result of lower net income. The effective tax rate for the financial year ended March 31, 2026 was 24.49% as compared to 23.30% for the financial year ended March 31, 2025.\n\n \n\n75\n\n##### Table of Contents\n\nQuantitative and Qualitative Disclosures About Market Risk\n\nMarket risk is the potential for economic losses to be incurred on market risk-sensitive instruments arising from adverse changes in market factors such as interest rate, foreign currency and credit risk. Management establishes and oversees the implementation of policies governing our investing, funding, and foreign currency activities in order to mitigate market risks. We monitor risk exposures on an ongoing basis.\n\nWe also use derivative instruments to manage exposure to market risks as set out in “Note 14. Derivative Instruments” of the consolidated financial statements appearing elsewhere in this Annual Report.\n\nInterest Rate Risk\n\nWe are exposed to interest rate risk from fixed interest rate assets and liabilities on the balance sheet. Interest rate risk is managed against a control framework, which is defined with set metrics and limits in place.\n\nThe main fixed interest rate exposure for us is driven by sovereign bonds. Changes in the fair value of available-for-sale bonds (due to changes in interest rates) are reported through other comprehensive income.\n\nWe are also exposed, more generally, to the risk of changes in interest income, primarily on customer balances, and interest expense on customer liabilities resulting from potential movements in interest rates on our financial assets, including cash and cash equivalents and short-term investments.\n\nA 1% instantaneous downward shock of all interest rate curves would have resulted in a reduction of $148.5 million in interest income before tax for the financial year ended March 31, 2026 (2025: $111.2 million). A 1% instantaneous upwards shock would have resulted in an increase of $151.0 million in income before tax for the financial year ended March 31, 2026 (2025: 112.0 million).\n\nForeign Currency Risk\n\nWe are exposed to foreign exchange rate movement from holding assets and liabilities in different currencies and guaranteeing customers a foreign exchange rate on their international transfers not funded from balance for a period of time, dependent on funding currency. We actively monitor foreign exchange risk in pounds sterling, and exposures are managed through a combination of natural hedging and derivative financial instruments.\n\nWe use a combination of foreign currency swaps, foreign exchange spots/forwards and non-deliverable foreign exchange swaps/forwards to manage our exposure to foreign currency risk.\n\nWe monitor foreign exchange risk on an ongoing basis using a value at risk and stressed value at risk approach, considering the foreign exchange risk arising from open non-sterling currency positions as foreign exchange rates move adversely against our open positions. For the sensitivity analysis, a severe stress was applied to our March 31, 2026 positions, which assumes that both euros and U.S. dollars would depreciate 5% against other currencies simultaneously. In this scenario, the impact to the consolidated group in U.S. dollars, translated at the year end closing rate of U.S. dollars to pounds sterling would be a realized loss of $2.4 million over one day (2025: $4.1 million).\n\nOur reporting currency is the U.S. dollar, while some subsidiaries operate across a range of non-U.S. dollar functional currencies. Consequently, our financial results are affected by the translation of transactional currencies to functional currency at subsidiary level, and then from functional currency to the reporting currency of U.S. dollar.\n\nCredit Risk\n\nWe manage credit risk exposure based on our credit risk appetite. We actively manage credit and concentration risk through our policy of imposing credit limits in order to control the exposures (amount and period) we have\n\n \n\n76\n\n##### Table of Contents\n\nwith each counterparty considering their level of risk. These limits are set based on the credit ratings or perceived credit quality of each counterparty and approval must be obtained from the Credit Risk Committee for any exceptions outside of the framework.\n\nOur credit risk is spread over a range of assets, further details of which are set out in the notes to our consolidated financial statements appearing elsewhere in this Annual Report:\n\n \n\n \n•\n \n\nCash and cash equivalents;\n\n \n\n \n•\n \n\nDebt securities;\n\n \n\n \n•\n \n\nAccount receivables;\n\n \n\n \n•\n \n\nInterest receivable;\n\n \n\n \n•\n \n\nDerivative financial instruments; and\n\n \n\n \n•\n \n\nCollateral deposits the Group holds with its counterparties.\n\nCredit risk is mitigated as the majority of these financial assets are held with investment grade financial institutions or invested in highly rated financial instruments with credit ratings assigned by reputable credit rating agencies such as Moody’s, Standard & Poor’s and Fitch Ratings.\n\nAs per the Group’s investment policy, the debt securities consist of quoted bonds and other fixed asset securities that are graded in the top investment categories (rated A- and above), predominantly in Government bonds as set out in “Note 11—Available-for-Sale Debt Securities” of the consolidated financial statements appearing elsewhere in this Annual Report.\n\nB. Liquidity and Capital Resources\n\nSources of Liquidity\n\nAs of March 31, 2026, our primary sources of liquidity were our cash and cash equivalents, Safeguarding Guarantees), our EMTN Program and our Revolving Credit Facility.\n\nAs of March 31, 2026, we had cash and cash equivalents of $27,802.2 million, as compared to $18,066.3 million as of March 31, 2025.\n\nAs of March 31, 2026, we had a Safeguarding Guarantee in place to guarantee $1,119.1 million (£845.0 million) of customer funds, so that this amount does not need to be safeguarded via a segregation method and can be used for operating customer liquidity. As of March 31, 2025, $671.8 million (£520.0 million) was guaranteed by the Safeguarding Guarantee.\n\nAs of March 31, 2026, we had issued £250.0 million ($331.1 million at March 31, 2026) aggregate principal amount of Notes under the £2.0 billion ($2.6 billion at issuance date) EMTN Program. There was no EMTN Program in the financial year ended March 31, 2025.\n\nWe had $437.1 million (£330 million) available under our unsecured Revolving Credit Facility as of March 31, 2026, compared to $297.1 million (£230 million) as of March 31, 2025. There was no drawdown as of March 31, 2026 as compared to $129.2 million at March 31, 2025.\n\nWe are required to maintain minimum levels of liquidity within our regulated businesses and the Group overall in accordance with local regulatory requirements. We monitor liquidity levels of our regulated entities on an ongoing basis, in accordance with our internal liquidity adequacy assessment process.\n\n \n\n77\n\n##### Table of Contents\n\nDue to our strong net cash provided by operations, the available balance under the Revolving Credit Facility, EMTN Program(as defined below) and Safeguarding Guarantee, we believe that we have sufficient financial resources to fund our activities and execute our business for at least the next 12 months and over the long term.\n\nWe are committed to financial discipline and a sustainable level of profitability, while continuing to invest in growth opportunities, so that both our customers and our shareholders continue to benefit from our long-term growth. We plan to continue investing in product innovation, infrastructure and partnerships to help people and businesses move and manage their money. We have no material financing commitments that are expected to affect our liquidity over the next five years, other than our lease obligations and supplier purchase commitments in the normal course of business and as disclosed in the notes to our consolidated financial statements appearing elsewhere in this Annual Report and the maturity of the 2030 Senior Notes issued in November 2025 under the EMTN Program.\n\nIndebtedness\n\nRevolving Credit Facility\n\nIn December 2024, we entered into an agreement for a multicurrency revolving facility agreement (the “Revolving Credit Facility”) with certain of our subsidiaries as borrowers or guarantors, as applicable (together with any additional borrowers or guarantors, as applicable, the “Borrowers and the “Guarantors”), HSBC Innovation Bank Limited, as mandated lead arranger, the other lenders party thereto (together with HSBC Innovation Bank Limited, the “Lenders”) and HSBC Bank plc, as agent. Pursuant to the Revolving Credit Facility, the Borrowers may borrow up to £330.0 million ($437.1 million at March 31, 2026) aggregate principal amount, which may in certain circumstances be increased by an additional aggregate principal amount of £100.0 million ($132.4 million at March 31, 2026). The Revolving Credit Facility matures on December 12, 2027, subject to a maximum of two one-year extensions in accordance with the terms thereof.\n\nBorrowings under the Revolving Credit Facility bear interest at a rate equal to SONIA (in the case of loans made in sterling), SOFR upon the occurrence of certain pre-agreed trigger events (in the case of loans made in U.S. dollars), EURIBOR (in the case of loans made in euros) and the Australian Bank Bill Swap Reference Rate (in the case of loans made in Australian dollars), (in each case, subject to a zero floor), plus a margin of 1.75% to 2.25% per annum determined by reference to adjusted leverage (calculated as the ratio of senior debt on the last day of the Relevant Period (as defined under the Facility Agreement) to Adjusted EBITDA for the Relevant Period).\n\nThe agreement governing the Revolving Credit Facility (the “Facility Agreement”) contains customary representations, information undertakings and covenants. In addition, the Facility Agreement includes financial covenants that require that: (1) adjusted leverage does not exceed a ratio of 3:1 in respect of any Relevant Period; (2) interest cover (calculated as a ratio of Adjusted EBITDA to Finance Charges (as defined under the Facility Agreement)) is not less than a ratio of 3.5:1 in respect of any Relevant Period; and (3) adjusted contingent leverage (calculated as a ratio of the guarantee amount under each Safeguarding Guarantee) to Adjusted EBITDA does not exceed a ratio of 3:1 in respect of any Relevant Period. These financial covenants are tested on a semi-annual basis.\n\nAs of March 31, 2026, we had $437.1 million available for borrowing under the Revolving Credit Facility.\n\nSafeguarding Guarantees\n\nTo comply with requirements set out in the Electronic Money Regulations 2011, Wise Payments Limited (“WPL”) is required to safeguard ‘relevant funds’ received from customers. WPL meets these requirements by a combination of: (1) holding funds in a third-party safeguarding bank account; and (2) taking out insurance with an authorized insurer or an authorized credit institution (such insurance, the “Safeguarding Guarantee”).\n\n \n\n78\n\n##### Table of Contents\n\nIn May 2024, WPL entered into a Safeguarding Guarantee with each of Chubb European Group SE, Euler Hermes SA (NV), Everest Insurance (Ireland), DAC, HCC International Insurance Company plc, Liberty Mutual Insurance Europe SE, Markel International Insurance Company Limited, Swiss Re International SE, UK Branch, Travelers Insurance Company Limited and Zurich Insurance Company Ltd, UK Branch (the sureties), which collectively provide guarantees of up to an aggregate amount of £520 million ($671.8 million at March 31, 2025), with an initial term of 18 months. In July 2025, each Safeguarding Guarantee was renewed until November 10, 2027, with the same nine sureties collectively providing guarantees up to an aggregate amount of £845 million ($1,119.1 million at March 31, 2026).\n\nIn connection with the renewed Safeguarding Guarantees, we and certain of our subsidiaries entered into a deed of indemnity with each surety, under which we and the relevant subsidiaries (collectively, the “Indemnitors”) have agreed to indemnify each surety for losses incurred if it makes the safeguarding payments.\n\nEach Safeguarding Guarantee contains certain customary warranties, representations and undertakings. In addition, each Safeguarding Guarantee includes financial covenants which require that: (1) the adjusted senior leverage ratio of senior debt under the Revolving Credit Facility to Adjusted EBITDA cannot exceed 3:1; (2) the adjusted contingent leverage ratio of the aggregate insurance amount to Adjusted EBITDA cannot exceed 3:1; and (3) the aggregate insurance amount cannot exceed cash, cash equivalents and undrawn amounts under the Revolving Credit Facility on the last day of the half financial year or full financial year period.\n\nUnder the conditions of each Safeguarding Guarantee, a surety can demand cash from any indemnitor upon the occurrence of certain events, including insolvency, change of control and termination of the Revolving Credit Facility. Any one indemnitor can trigger such a demand. Each Safeguarding Guarantee also includes cross-acceleration provisions, which allow an insurer to demand payment if any financial indebtedness of the Group (including the Revolving Credit Facility or the Notes) is demanded or a commitment for any financial indebtedness of the Group is cancelled (subject to a £20 million ($26.5 million at March 31, 2026) de minimis threshold).\n\nNo security is provided to the sureties.\n\nEuro Medium Term Note Program\n\nIn November 2025, we established a Euro Medium Term Note Program (the “EMTN Program”), under which Wise Financing plc (“Wise Financing”), a subsidiary of Wise plc, may from time to time issue senior unsecured notes (“Notes”) up to an aggregate principal amount £2.0 billion ($2.6 billion at issuance date). Notes issued under the EMTN Program will be guaranteed by certain of our subsidiaries.\n\nNotes may be issued in bearer form or in registered form only. Subject to compliance with applicable laws and regulations, Notes will be issued in denominations of at least €100,000 or the equivalent in any other currency and with such terms as may be specified in the applicable pricing supplement. Notes may bear interest at fixed or floating rates, may be zero-coupon, and may be issued at their nominal amount or at a discount or premium to it, as set out in the relevant pricing supplement. The rate of interest for floating-rate Notes may be linked to customary money-market reference rates or alternative reference rates, as specified in the applicable pricing supplement.\n\nThe documentation governing the Notes includes customary covenants and provisions relating to events of default, payment mechanics, substitution of Wise Financing or Wise plc as issuer and parent guarantor of the Notes, respectively, accession and release of guarantors, transfer restrictions other terms typical for unsecured note instruments of this type.\n\nIn November 2025, we issued £250.0 million ($329.0 million at issuance date) aggregate principal amount of Notes under the EMTN Program. Such Notes bear interest at a rate of 5.1000% per annum, and mature on November 25, 2030 (“the 2030 Senior Notes”).\n\n \n\n79\n\n##### Table of Contents\n\nThe 2030 Senior Notes are guaranteed on a senior unsecured basis by Wise plc and certain of our wholly owned subsidiaries the “Guarantors” and each a “Guarantor”). The Guarantors are 100% owned by Wise Group plc, and the guarantees are full, unconditional, joint and several. There are no significant restrictions on the ability of Wise Group plc or the Guarantors to obtain funds from each other in the form of a dividend or loan. The guarantees rank at least pari passu with all other outstanding unsecured and unsubordinated obligations of each Guarantor or the Issuer, present and future, save for obligations mandatorily preferred by laws of general application to companies and only to the extent permitted by applicable laws relating to creditors’ rights.\n\nCash Flows\n\nThe following table summarizes the primary sources and uses of cash for each period presented:\n\n \n\n \n  \nYear ended March 31,\n \n\n(in million)\n  \n2026\n \n  \n2025\n \n\nCash and cash equivalents at beginning of the period/year\n\n  \n$\n18,066.3\n \n  \n$\n13,245.7\n \n\nNet cash provided by operating activities\n\n  \n \n7,553.9\n \n  \n \n5,719.5\n \n\nNet cash provided by/(used in) investing activities\n\n  \n \n1,738.5\n \n  \n \n(758.5\n) \n\nNet cash (used in) financing activities\n\n  \n \n(274.9\n) \n  \n \n(229.9\n) \n\nEffect of exchange rate fluctuations on cash and cash equivalents\n\n  \n \n718.4\n \n  \n \n89.5\n \n\nCash and cash equivalents at end of the period/year\n\n  \n$\n27,802.2\n \n  \n$\n18,066.3\n \n\nComparison of the Year Ended March 31, 2026 and 2025\n\nNet cash provided by our operating activities was $7,553.9 million for the financial year ended March 31, 2026, compared to $5,719.5 million for the financial year ended March 31, 2025. The increase of $1,834.4 million, or 32%, was primarily due to a 36% increase in our customer accounts balances.\n\nNet cash provided by investing activities was $1,738.5 million for the financial year ended March 31, 2026, compared to net cash used in investing activities of $758.5 million for the financial year ended March 31, 2025. The increase of $2,497.0 million, or 329%, in net cash provided by/(used in) activities was primarily due to a net increase in sales of available-for-sale debt securities of $2,473.1 million. Cash outflows for investing activities were also higher in the financial year ended March 31, 2026 by $24.5 million as a result of purchase of property, plant and equipment, predominantly with respect to new office spaces in London and Tallinn.\n\nNet cash used by our financing activities during the financial year ended March 31, 2026 was $274.9 million as compared to $229.9 million for the financial year ended March 31, 2025. The increase of $45 million, or 20%, was primarily due to the $328.7 million net carrying amounts of Notes issued under EMTN Program. This was offset by an increase of $380.9 million cash outflow with respect to the Employee Share Trust share purchases in the financial year ended March 31, 2026 as compared to the financial year ended March 31, 2025 along with the repayment of borrowings under the Revolving Credit Facility.\n\nContractual Obligations and Commitments\n\nWe routinely incur contractual obligations for marketing and advertising, software subscriptions and various service arrangements, including cloud infrastructure and compliance applications. While many of these contracts are short-term (cancellable within one year), some significant software and cloud service agreements involve multi-year commitments. Additionally, we have substantial long-term lease obligations for office space. Changes\n\n \n\n80\n\n##### Table of Contents\n\nin our business needs, contractual cancellation provisions, fluctuating interest rates, and other factors may result in actual payments differing from the estimates. We cannot provide certainty regarding the timing and amounts of these payments. For further discussion of commitments and contingencies, please refer to “Note 20. Commitments and Contingencies” and “Note 10. Leases” in the notes to our consolidated financial statements appearing elsewhere in this Annual Report.\n\nC. Research and Development, Patents and Licenses, etc.\n\nPlease refer to “Item 4.B. Information on the Company—Business Overview—Intellectual Property” for further information on our material intellectual property and to “Note 2. Summary of significant accounting policies” within our consolidated financial statements appearing elsewhere in this Annual Report.\n\nD. Trend Information\n\nOther than as disclosed elsewhere in this Annual Report (see “—A. Operating Results—Key Trends and Factors Affecting Our Performance”), we are not aware of any trends, uncertainties, demands, commitments or events for the year ending March 31, 2027 that are reasonably likely to have a material and adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future results of operations or financial conditions.\n\nE. Critical Accounting Estimates\n\nOur consolidated financial statements have been prepared in accordance with U.S. GAAP. The preparation of the consolidated financial statements requires us to make judgements, estimates and assumptions that affect the value of assets and liabilities—as well as contingent assets and liabilities—as reported on the balance sheet date, and revenues and expenses arising during the financial year.\n\nThe estimates and associated assumptions are based on information available when the consolidated financial statements are prepared. This includes historical experience, current conditions and various other factors which are believed to be reasonable under the circumstances. Due to market changes or circumstances arising that are beyond our control estimates may vary from the actual values.\n\nThe estimates and underlying assumptions are reviewed on an ongoing basis. Revision of accounting estimates is recognized in the period in which they become known and are applied prospectively.\n\nTransaction and Credit Losses\n\nWe have exposure to current expected credit losses for financial assets including cash and cash equivalents, debt securities, accounts receivable, interest receivable and collateral deposits that we hold with its counterparties.\n\nWe utilize a combination of aging and probability of default methods to develop an estimate of credit losses, depending on the nature and risk profile of the underlying asset pool. A broad range of information is considered in the estimation process, including historical loss information adjusted for current conditions and expectations of future trends. The estimation process also includes consideration of qualitative and quantitative risk factors associated with the age of asset balances, expected timing and probability of default, loss given default, exposure at default, counterparty tiering classifications, merchant and customer risk profiles, country risk profiles for higher risk jurisdictions and relevant macro-economic factors. Determining the appropriate current expected credit loss allowance is an inherently uncertain process requiring significant estimation and ultimate losses could differ materially from the current estimates.\n\nPlease refer to “Note 2. Summary of Significant Accounting Policies—Transaction and Credit Losses” in the notes to our consolidated financial statements appearing elsewhere in this Annual Report for additional information.\n\n \n\n81\n\n##### Table of Contents"}