Are you sure you're not confusing things? Direct debit usually means just a permission to charge the given account for the specified amount. It's commonly used in Canada and doesn't involve sharing your password.
Their "debit" option works the way you think. You give only your bank card number, expiry date, and CVV.
However, their "direct debit" option requires you to enter your bank debit card number and bank password into Wise's web form. It is not a redirect to the bank website. The URL says "https://wise.com/..." when you're asked to enter that info. Wise definitely gets your bank credentials.
They have yet another option called "bill payment" in which you log into your bank account yourself and do a bill payment to Wise (and giving your Wise account number).
Both the "debit" and "bill payment" methods look secure and acceptable. But Wise charges a considerably higher fee than with their "direct debit" method. And it always seems to take a day or two for the funds to appear in your Wise account with those other methods. They really want to encourage their "direct debit" method in which they get your bank login info.
The reason I ask is that that is what is called a "Direct Debit" in the UK and the European SEPA area, and it does not involve providing any credentials to the bank account. Rather, you only need to provide your International Bank Account Number (IBAN) and maybe your name. However, the ability for a company to be able to take Direct Debit payments is heavily regulated, you can easily cancel them via your bank, and even reverse charges if they were illegitimate.