There are suggestions the young Englishman will seek a move in January for regular football.
But Wise believes that Loftus-Cheek can get enough chances with the Blues to show his quality.
"Look at Ross Barkley. Last year you would have looked at Barkley when he first came to the football club that he is not going to get much of an opportunity, but the new manager has given him that opportunity," Wise said in an interview with Goal.com.
"I look at Loftus-Cheek who is really pushing now. There's a lot of speculation that he should go out on loan and I think, why? Why? He should stay and fight here. I think he has a chance of pushing to get that other spot, as he competes with the other two.
"Why would you want to go to a team like Crystal Palace and fight down below when you can be at a team like Chelsea and fight for a Champions League position and to win trophies? He is only young as well, Loftus-Cheek, he has got a bit of time on his side.
"I think what he has done so far is that he has made progress as well. He is looking good. I think it is important he stays at the football club and doesn't go out on loan."