how about a modification to option three to encourage loyalty? My suggestion is that as soon as you reach a defined threshold say of spending in a calendar year or per month (which ever discourages the 13%) you can nominate golden month where you can have £400 before charges. Not fully formed yet but just an Idea.
Thanks for asking and not just imposing.
Precisely. Many cardholders will think the same and interest in Monzo may collapse.
I think this is a great idea, and would also love to see the fee-free amount set as an annual amount of £500-£600. It seems that it would fit within the costs Monzo can afford based on option 3, but make provision for someone who goes on a holiday to a country where it’s not possible to pay by card in most places.
4 Likes
I’d rather see interest from people using 
as a travel card collapse, instead of Monzo’s ability to run as a financially stable operation collapse. 
People withdrawing their money overseas must be a tiny minority of UK banking activity. The main banking activity (i.e. my day-to-day life) is far more important to me.
19 Likes
What is the charge, out of interest? Is it more than the options Monzo are proposing?
1 Like
@garete - If I understand the problem correctly, ATM use does not need to be 100% eliminated in order for Monzo to have a financially viable business model. Rather, they just need to reduce the small percentage of Monzo customers who are responsible for the lion’s share of the ATM withdrawal fees in the major countries where this occurs.
I’m not suggesting that the debit card is eliminated since it’s useful when paying for goods and services through the MasterCard network for example. As I understand things, Monzo is not hemorrhaging money via this usage, so it should continue to be offered.
Additionally, I am positing that even if the existing free ATM withdrawals were retained, Monzo would hemorrhage significantly less money if they provided accounts in a variety of countries with a cost effective FX conversion service to transfer money in between. This seems to be the direction that Revolut is heading. If the bid/ask of this conversion service was better than MasterCard (0.5%) then there would be little incentive for a customer to withdraw massive amounts of USD using their Monzo card in a New York City ATM (in order to turn around and pay the cash into their US-based Chase account for example). Customers needing to transfer large amounts of GBP into USD would stop using the ATM and use the FX Conversion service instead. ATM use would again return to being something that is only used by travelers rather than non-UK residents.
Note that nowadays, when visiting developed countries you can get away without needing much cash since mastercards are widely accepted. This is why I suspect that the Monzo customers are using ATMs as an alternative to a money transfer service (either that, or they are buying a lot of illicit drugs with all that cash!)
1 Like
The only reason I still use Monzo when traveling abroad is because it currently has no fees for withdrawing cash from the ATM. I have a credit card not no fees for making purchases in a different currency so I don’t use Monzo for shopping.
I also have the Curve card that allows me to link my debit and other credit cards with a £2 ATM fee plus a 1% foreign exchange fee. If Monzo decides to stop free cash withdrawals abroad then I won’t have a reason to keep this card as my Curve card will have a similar or better rate (i.e. if the foreign fee is 2%) and I will only need to carry one card.
1 Like
The point is there’s no need to have an additional card.
Nice one. So, being one of the users who’ve forced Monzo to introduce a fee, you’re going to bail and leave the mess in your wake. Well done you.
9 Likes
The card offered free ATM withdrawals abroad, it didn’t say ‘only use this benefit after making all your purchases with it’ didn’t it?
I didn’t force anything, shouldn’t have offered that if couldn’t provide such thing for free in the first place!
Funny you should mention that, but that’s pretty much what Nationwide ended up doing with their card. They only allow fee-free purchases outside the U.K. up to the amount that you have accumulated in total spend on their card within the U.K. This way I suppose that ensure that they have sufficient income from the inside U.K. transactions to fully subsidize the outside of U.K. transactions.
As others have already suggested though, Monzo is going to lose a lot of customers if they don’t provide some kind of cost saving to their customers to make it more attractive than using a competitor’s card.
Having a nice app isn’t by itself sufficient to attract and retain customers. It won’t take long for traditional banks to improve their apps and catch up, but they will be super-slow to cut fees or offer multi-currency accounts.
I cannot get into the ATM fees discussion so I’ve started a new one here…
Given that the direct cost seems easily measurable, the fair, transparent and easy way to do it would be to charge for using a foreign ATM.
So how about allowing account holders to choose to access this service and pay an appropriate fee.
Given the figures supplied, I would suggest £20 per annum as the simple, easy to understand fee for access to overseas ATMs. Customers can then choose to use this service and pay the annual fee, or not.
It looks like the issue’s resolved itself (although the page is sometimes momentarily failing to load when I enter the topic too) so I’ve moved your post here, to keep all of the discussion in one place.
1 Like
I agree that £200 per month would be on the low side. I suppose my wife could also get a Monzo account and then we would have £400 between us. That might work. So a fee free allowance is good. Just think £200 is on the low side.
The drawback, for me, of the £200 per month is that it doesn’t reflect my usage. I use the card extensively in the uk and occasionally travel abroad. When there I will use the card for cash from ATM several times and easily bust the £200 level which means I will be paying lots. If the limit were cumulative, i.e. £2400 over 12 months, that works for me.
B
1 Like
This is what I was thinking. It might be harder to implement and communicate but higher withdrawal limits for someone who actively uses the card and generates revenue that way?
Limited for those who are using Monzo as a glorified currency card.
1 Like
Honestly this whole discussion has left a bad impression for me on Monzo. You can’t offer a service and then label users as “offenders” when they use it. It’s absolutely absurd. Surely when you first created the business model you’d have done some calculations and projections on what is sustainable or not and factored that in. Given there are other cards and services who offer the exact same thing but for free why would people take up Monzo going forward? The free withdrawals was certainly a draw card for me when I first signed up and I’ve since recommended you to a number of family and friends. I did sign up to Monzo for the international withdrawals but I also use it now on a daily basis in the UK, though now I’d think twice about recommending you because there’s not much to recommend. Your IP is the beautiful app and budgeting functionalities but it won’t be long until the other banks catch up, some banks are already doing a small segment of what you offer now in terms of a tracker.
If you need an option, go with a rewards based option based on UK usage which a lot of people have recommended. You say there’s a 4th option but really there isn’t, there’s just 3 we can pick on because none of the other suggestions have even been looked at but your team.
Finally those who use your service are smart and thrifty. Not offenders as you label them.
1 Like
Hi @anon75254843,
So I guess first off that I was the one who used the term offenders i.e. “worst offenders” in the context of those 13% who make up something like 85% of these charges, whilst it was probably the wrong word to use when what I meant was those who cost an unreasonably disproportionate amount in charges but at the time it reflected my general shock at those figures and the feeling that it’s unreasonable for everyone else to foot the bill for their excessive use.
First of all whilst it has been batted about, I don’t think that monzo has ever used the term offenders, however, this topic has obviously caused some strong feelings on both sides. The initial prepaid account was never designed as a tool for ~400,000 users with so much international use. Unfortunately, sites like MSE and others highlighted the free withdrawals and many people took advantage of this offer which could not have been foreseen when the project was launched so I really don’t think it’s fair to say that they should have expected this kind of growth and international use.
Whilst I get by your tone that you are angry, I don’t think it’s fair that you take it out on monzo for calling the worst users offenders (when that was in fact meant to be a non-offensive turn of phrase initially posted by me and never repeated by anyone from the organisation itself). I also don’t think it’s fair to say that they should have expected the sheer number of people using it mainly for expensive international ATM withdrawals.
The big question is this, do you want a bank that thrives or do you want Northern Rock V2
2 Likes