I’m the Chairperson for a small London based charity, holding no more than £70k in the bank at any time. We recently embarked on a banking consolidation process and it was really interesting to find out how hard it was to meet our requirements.
For what it’s worth, I’m sharing as feedback and potential ideas for Monzo business because I imagine there are a high number of organisations of our size going through something relatable and wanting features and functionality to help solve a similar challenge.
We had 4 bank accounts for different purposes including CAF Current, CAF Gold, Unity Trust and Lloyds Bank.
To reduce operational overhead we decided to consolidate into 1 single account that was fully integrated with our accounting software (Quickbooks Online) which in turn is integrated and reconciled with our CRM, automatically. Manually, this process can take significant time each month and there is plenty of room for error.
Dual Authorisation for outgoing payments
Ability to connect into Quickbooks Online (via OpenBanking or otherwise)
Multi-user access (Not just Persons with Significant Control such as directors/trustees - has to have staff-level access)
Ability to receive membership Direct Debits that are collected via a 3rd party bureau we use. We collect once a year, around 400 BACS in total. This transfer process requires bank sponsorship to migrate the Service User Number.
Affordable monthly fee
We wanted to, if possible, go with a challenger bank after being burnt multiple times by big banks. Even with the charity focused banks, the experience is often dire and lack innovative features.
We investigated Monzo (I’m a personal customer), Starling, Tide, N26 and Revolut.
After much investigation, it wasn’t possible to go with a challenger bank as we couldn’t meet these requirements.
The primary reason being the Dual Authorisation recommended for charity financial control and governance was only available in Revolut at a price of £25/m. For us, that’s not really a justifiable monthly fee compared to what we currently pay for banking. I’m also not a massive fan of Revolut’s ethos and working practices anyway.
Revolut and Monzo offered true multi-user access. Starling and some of the others only offered multi-user access only to directors/PSC.
Quickbooks Online integration was available with all.
The Direct Debit requirement proved to be more complex than we first envisaged. If you are using a managed service provider like GoCardless, all accounts work great as GoCardless doesn’t care which account you pay out into. For ‘offline’ legacy 3rd party Bureaus, there is still a requirement for the bank to sponsor the migration of the Service User Number and offer a BACS Direct Debit Limit to be applied to the receiving account. This is my laypersons understanding of it. And, as far as I can tell, no challenger offers this kind of product.
In the end, we were forced to consolidate into Lloyds for the time being, at my despair. We pay a monthly fee of £7.00 and some horrendous overseas charges.
Anyway, hope it was helpful for me to share what we went through. I know the Direct Debit one is a challenge, but if Monzo had provided Dual Authorisation alongside the great features it already has, I could have still made the case to move.