Twisted? I think it’s great. Make it free for genuine need and charge those who abuse it.
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The other option was also charging those that use it, only it was doing it fairly where all paid close to what they used, and not some subsidizing others.
I don’t think you are being entirely fair here, your post flat out shows misleading/wrong “actual costs” and insinuates that these are uniform, when we were always told that it is both; a mixture of both % and flat fee, and it widely varies between banks and countries.
Monzo always wanted a fair and easy pricing structure which would be impossible if they simply passed actual costs, as these wouldn’t be know until after the fact. All three pricing options suffer from not being exact (sometime they will be fractionally above actual cost, sometimes below) and their “fairness” is subjective, customers were given the choice and they chose what they thought was best.
This has however been discussed ad-nauseam so enough post derailment, lets get back onto debit card top-ups, where in this case it is easier to pass on exact fee which, I vote for as the best option!!
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I am quoting the figures given by the CEO Tom. Yes he explained the costs are a mix of fixed monetary amount costs and variable percentage costs but he explained that they averaged out at 1% in Europe and 2% elsewhere. Furthermore he voted for this option as it most closely reflected their costs.
I therefore dispute your allegation that I was misleading or wrong. Should you wish to make that allegation to Tom (who surely knows more about their costs than you) then go ahead!
I don’t think it’s right to imply the current scheme is ‘unfair’ - paying actual costs is not the only ‘fair’ way in business. The charge is fair - it’s justifiable, it isn’t absurdly out of proportion to actual costs, etc.
The pricing model isn’t flat because it incentivises good behaviour. If you behave well, use cash only where needed, the vast majority of people can get totally free overseas use. People who are abusive and withdraw enormous sums will be put off. A small number of reasonable users in the middle (mostly those travelling to countries that are both expensive and cash-heavy like Japan) will be caught out.
But overall, I feel it’s very fair. If I behave well, Monzo still gives me a free perk. If I don’t, it’s the same price as most banks.
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It is fair that customers pay the cost and while I appreciate it is impossible to charge each customer the exact amount they incurred to Monzo to pay as close to reality as possible is fairest.
Paying not 1.5, 1.75, 2.0 but 3% when they are billed about 1% for a transaction in Europe is not just an extra percent but 300% of the cost they are having to pay.
To talk about people abusing the system is only relevant prior to the charge being introduced. After the introduction of the charges if someone is withdrawing a large sum due to visiting a cash orientated economy or having a large family so requiring more spending money they are not abusers as they are covering their costs thru paying Monzo the new fees.
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