📰 Monzo's Tom Blomfield on cutting the crap from financial services



That’s a good read. It’s not great to hear that the fee free foreign transactions could go away at some point but I don’t think that Tom could guarantee that they wouldn’t so I’ll worry about that if & when it’s announced…

This is only a minor detail but if this is correct -

Another difference is the low level of risk Monzo takes with its depositors’ money, he says, with only some 20% of user deposits loaned out, versus up to 100% within large high street outfits.

Then Monzo’s ethics page (which currently says that ~10% of deposits will be loaned out), needs updating.

I think the author may have possibly embellished/speculated the point about free forex possibly going away - the way it is written is more a solliloqui than dialogue.

Would be very interested to hear from @tom if this was actually discussed. Apart from being anti-punitive fees I know he has previously said along the lines of “forex is on a trend towards zero margin so it’s not something for monzo to differentiate with” so I find it very hard to believe they are going to whack fees on it. They might as well be NatWest if that’s the plan.

All journalists seem to have to add a “however…” paragraph towards the end for integrity’s sake even when they have nothing contrary to say. My guess is misguided journo speculation!

Edit: I just re-read it and seems I skimmed past the quote from Tom about not being able to commit to free forex! Whoops… would still be good to hear why he can’t do so.

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I’d like to hear more on this from Tom.

I agree that this aspect of monzo was never the selling point, however, it has been one of the silent selling points.

Yes indeed. I’d envisaged relying in the future for cheap foreign currency on Monzo and dropping the Revolut card. Guess I’ll leave things as they are.

It looks like it’s worth pointing out again that nothing has changed & no one’s said that Monzo will start charging fees for foreign transactions.

Obviously if Monzo’s finances start to get tight then they would have to reconsider. But why would drop such an attractive feature - which is responsible for so many users signing up? Any FinTech that starts to struggle will charge more fees - just like N26 - so Tom can’t say that Monzo will never charge this fee.


It would take a brave bank manager to promise free forex forever in the current political climate! I would hedge my bets too. Obviously I want to keep it, but if I can’t, I would hope that I’d only be charged at cost. It’s not in their plans for a revenue stream.


This interview was pretty wide-ranging, and maybe I was too vague at the time!

We’ve got a clear goal - we want Monzo to be a financial control centre for a billion people around the world. But the path to getting there is not set in stone. We tend to be quite iterative, so making cast-iron promises about the future is frankly impossible.

If you’d have asked me two years ago whether I could guarantee we’d still be called “Mondo” today, I’d have probably said yes. And I would have been wrong!

By the end of 2017, we’re currently forecasting that less than 10% of our deposits will be loaned out. But as that number is currently 0%, it’s hard to say for sure. We break-even if we lend out about 20% of our deposits, which I guess we’ll aim for some time in 2018 or 2019.

I’ve said before that I think FX will tend towards zero cost to the consumer over time, and I still believe that. There’s very little inherent cost in it, and the large banks are ripping off customers.

The exception is foreign ATM withdrawals, which cost Monzo around 2.5% for any withdrawal outside of the EU. So if you take out £200 in India, that one withdrawal costs Monzo £5. We offer it to our customers for free. So you can see how those costs add up over time.

So for now, if you’d like to help Monzo out, please do try to pay in-store with your card, rather than using ATMs, where possible :slight_smile:

(or contactless, in restaurants, online etc, etc. Just not ATMs! They’re very costly)


Thanks Tom, this is really helpful.

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Given the cost of foreign ATM withdrawals, I wonder if some kind of restriction is needed(regular funding, direct debits etc), to stop Monzo becoming a second account used just this purpose. I recall nationwide had this problem, around 10 years ago when they scrapped foreign use fees

A push notification the first time a user withdraws outside the eu with your message would enlighten a lot of people. I personally didn’t know of this cost and will try to avoid incurring it in future.

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