I’m enjoying a nice holiday in Rome. We are moving by car, and yesterday I used Monzo to pay for fuel using a self service machine. After buying about 15 euros of gas, in the next few minutes, I was charged 101 euros on my Monzo account. The transaction was still pending, but the 101 euros already deducted.
It stayed like that until the morning after, at about 10am, when the amount changed to 15 euros, and the transaction wasn’t pending anymore.
I don’t really mind too much, as I got the money back, but still it was an uncomfortable experience, and there could be the argument that you actually can’t afford to get so much money rendered unavailable for about 12hrs. It kinda of creates a sense of uncertainty that I’m sure you want to avoid ( the less convinced friends that are using Monzo were a bit disconcerted by my tale )
This is because the fuel station authorises (reserves) up to a certain amount of money for the transaction, in this case 101 Euros. When you fill up, you obviously have filled up with a certain amount of fuel, ie 15 Euros. When the merchant comes to collect the money at presentment they update the amount they actually want to collect, the amount of fuel you have used - so they only actually charge you for 15 Euros worth.
Because we show you authorisations in real time, big reservations of money like this can look a bit scary which in some cases, like this, unfortunately there isn’t much we can do about it as it is the merchant that sets these.
Unfortunately that’s just how some (bad) fuel stations work - they authorise a huge amount (the max amount of fuel you’d be able to get out of the machine) and then at presentment (which can happen up to 30 days later) they present the proper amount.
This also happens with legacy bank cards, if you used one on that machine you’ll see your available balance decrease by the full amount authorised by the machine (101 euros in this case) up until presentment where it changes to the correct amount.
This just shows how good Monzo is. I had a similar situation and actually was shocked that I didn’t know this happens. But because legacy banks don’t show you real-time updates on your account you don’t really notice. So it might be scary but at the same time, but at least you know exactly what is going on in the background.
Yes, indeed, but I usually only use about 1/3 to 1/4 of my available credit limit, so there is a few thousand pounds buffer, while my current account balance is usually quite low (I keep my cash in interest bearing accounts as much as possible)
This is deliberate and how Monzo works. Monzo shows pending charges as if the money has been deducted. Don’t worry, it really hasn’t. Traditional banks have two balances - an ‘available’ balance that deducts pending charges and a real balance that only lists posted charges.
Personally, it’s one thing I don’t like about Monzo - only a pending balance, and transactions all mixed together. It’s cluttered and I dislike it. That said, I love Monzo overall and given they’re using this as a selling point, I doubt it’s ever going to change, so we just need to get used to it
Actually, I would like to challenge this. The money may not have gone out in theory, but this happened to me IN Sweden, the fuel company reserved 1500 sek on a 300 sek fuel charge, and my card went into overdraft, requiring me to transfer more money to balance that.
