Payments from Pots by Virtual Cards - how should they work?

A few of us (including @avb) have been talking about how paying directly from pots when you use a virtual card might work.

It seems there are two options:

  1. It works like the Bills Pot. Money comes out of the main account, and then a transfer is made immediately from the specified pot to cover the transaction. If you don’t have enough money in the pot, it’d be covered from the main account.
  2. It comes directly out of the Pot. This would need a new feed for pots, and lots of behind the scenes action. If you don’t have money in the pot, the transaction would be declined.

Neither option would be quick, but option 1 might be quite a bit faster to deliver than option 2.

Now, there are no guarantees that Monzo will build this - or that another option might fly in from nowhere.

But, knowing the trade-off in time, and the general options outlined above, which option would you prefer?

  • Option 1: Works like a Bills Pot (money out of main, then transfer from pot)
  • Option 2: Works like an account (money directly from pot)

0 voters

To be clear, this isn’t a Monzo poll, this isn’t a democracy (so the winning option might not be what happens) and it might not happen anyway! And do bear in mind that we’re a specific subset of user. Folk who don’t come on the community might have a whole different set of views.

With that said, vote! (I’ve become a parody of myself, haven’t I?)

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I’m a simple man, I see a poll, I vote…

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Thank you so much for calling this out. We really appreciate and take the views of our community seriously when building features, but sometimes research we do with other groups has a different view that we may end up going with. Please keep always sharing your thoughts with us :pray:

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I’m going to contradict myself vs what I said in the other thread, and how I voted here… But. I now think I actually want both. Hear me out!

These are my ideal use cases for a Virtual Card:

  • All my online shopping - any purchase I do online now comes from a VCard - this I want from my main account, per current behaviour.
  • Online Subscriptions - I would like these akin to a Bills Pot - but I have a separate Vcard for these because of how pesky some can be to cancel.
  • Specific retailer shopping, with whom I want to limit my spending - these scenarios I want a segregated account. So I can’t spend more than Pot Value.
  • Specific Categories of spending - same sort of thing, I might give myself a “fun budget” I don’t want to exceed - once the pot is empty I can’t spend any more.

There’s probably other use cases that are very good for both; but actually, both would be really powerful.

Although, with even more thinking, I suspect that in my own internal priority list, I would have more uses for “Freeze a VCard” or “One Time Only” VCard than I might my latter 2 examples.

Aaaand now I’m having an internal conflict of “How do pots fit into Monzo Budgeting” again.

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Either pots are effectively budget categories, or they are full accounts.

For example, in bunq pots are full accounts, have an IBAN, and one can dynamically switch which pot the debit card is attached. And then one can attach virtual card to the same or different one. It also has it’s own feed, and contributes to jumbo feed and can receive direct payments in. Can send money out directly. Can have direct debits. Kind of like a joint account… Apart from it’s just me, myself, and I.

Or pots remain stashes which transfer money to the main account to fill gaps created by bills / virtual / physical card payments.

It is true that both methods have it’s UX and implementation ups and downs.

I personally have just the one virtual card for everything distance payments. As it means my digital life is detached from physical card. And I need to update digital card details less often as expiry on the virtual card is longer. Thus I don’t have need for pots, or payments from pots to be anything more than transfer money to the main account.

I feel like there’s another solution. To be able to set rules on the account. So something between the rules you get in for example Outlook and IFTTT.

The idea being we can set our own custom triggers for actions to happen on our accounts. One of those triggers should be payments from virtual cards which will cover off the payments from pots issue.

I’d say this is almost definitely a feature for Plus though.

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I AM SO HERE FOR RULES

(Ahem)

((It would need to include triggers for money coming in - like salary - and be able to send money to external accounts though. But yes yes yes)).

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I’ve been chatting with Adam about this this morning, it’s not quite so clear-cut:

  • Making them work like Bills Pots is tricky, because get less time to process a Mastercard payment than we do for a Direct Debit.
  • Taking money directly from the Pot is tricky, because we’d need to add a feed for pots, and a bunch of other things…

tl;dr Nothing is easy, everything is trade-offs :sweat_smile:

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That’s always the way, isn’t it!

I was wondering if you could just process from the main account, then move later when there’s no time constraint? If overdrafts are the issue, could you dynamically change the technical overdraft behind the scenes so that your overdraft is agreed overdraft + value in pot? Then you could process the pot transfer in a relaxed couple of seconds after the card transaction has processed?

(Forgive my curiosity here: I know that you’re probably rolling your eyes at enthusiastic amateurs giving “solutions” that are probably anything but).

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We actually had this same conversation this morning and it took me a second to remember why this doesn’t work :sweat_smile:

If you do this then you can’t use any money “set aside” for the payment (as I think you’re hinting at). You’d want to consider the main account balance plus the pot balance, which is tricky (though of course not impossible) for us to do right now.

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Gotcha. I was falling into the trap of thinking it would be “simple” to advance a dynamic overdraft on the basis of the value held in a pot :man_facepalming:

(I’ll stop being annoying and trying to find solutions now, and leave it to the experts :monzo:)

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It’s all good :hot_coral_heart:

Definitely interested to hear what y’all would prefer of the two options!

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I think its a case of if its worth doing then its worth doing right, id rather it take an additional x number of months if it was polished as opposed to a stop gap version like the current bills pot.

But of course thats just my opinion

My suggestion (even as a stepping stone for now) would be to have IFTTT triggers based on if the payment was from a virtual card or not.
This way, I could set up an applet to move money out of a pot if the payment was from said card.

Use case:
I pay for Xbox games using VC1, and a games pass subscription using VC2, however both show as “Microsoft” or “Xbox” (Microsoft use them interchangeably) in my feed.
Using IFTTT, I could assign VC2 to trigger so that when I pay my subscription, IFTTT takes the money out of the pot I use for my other bills.
I can then also use VC2 for Netflix, Spotify, and achieve the same thing.

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1 can be done with IFTTT for those who really want it. I think it should be the opposite of 1 - pot to main transfer then payment. I wouldn’t want it declined if the main balance isn’t enough but the pot balance is!

I think unfortunately the timing required by the Mastercard payment gateway means the ‘accept transaction’ decision has to be near-instant, and doesn’t give enough time to check a pot balance, if I recall the conversations from the Bills Pots discussion correctly.

Possibly way off but assuming the following steps are currently taken:

  1. Transaction request arrives
  2. Match card number to account
  3. Check balance
  4. Process transaction

I don’t see how it’s any slower to:

  1. Transaction request arrives
  2. Match card number to account/pot
  3. Check balance
  4. Process transaction

I suppose it’s possible that something in the backend makes retrieving a pot balance significantly slower than an account balance but I’d be surprised. I imagine it’s an extra database column (is the card tied to an account or a pot) alongside the ID then a branch to get the balance from the correct place.

I think I would like a hybrid of both

So option 2 but with the added option that it takes from my main balance, if there isn’t enough in pot.

You can still destroy virtual cards/pots, so hopefully not security issue there

It seems a solution would be to have the money actually be taken directly from a pot, but make the feed item look like something from Bills Pots in the Home feed (i.e., Show the pot withdrawal transaction followed by the card transaction in the Home feed).

Also, it seems that the above could be extended to paying card subscription payments from Bills Pots.

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So basically it works just like bill pots for the user but not really in the implementation? If so then a great solution. Wasn’t there talk of regulatory issues as it would make pots a payment account?