Reducing the cost of debit card top-ups

Monzo is much better if you get your salary paid directly into your account or set up a regular standing order from your old-school bank (regular payments make budgeting easier, target-setting better etc), but sometimes we know it’s useful to be able to top-up instantly in an emergency. So we’re bringing back top ups for those times you really need them.

Read the full blog post here

However, unlike bank transfers, this method of adding money to your Monzo account has a processing cost which is out of our control. When averaged out across our entire customer base, debit card top-ups currently cost Monzo around £24 per customer per year. We need to reduce this cost for us to become a sustainable business in the long term.

One way we’re doing this is to provide alternative methods of adding money to your account that don’t cost money. Upgraded accounts support bank transfers and salary payments and we’re also exploring ways to make adding money even smoother, like the Current Account Switch Service, as well as the opportunities that the forthcoming Open Banking initiative offers. Imagine being able to trigger bank transfers from your other bank accounts from within the Monzo app.

However, we’re also beginning to explore ways we could reduce the cost of debit card top ups for us if the above features don’t help. Much like with overseas ATM fees, we’re starting to test some ideas around fees for high usage.

We are trying to stick to these principles when considering options:

  • We don’t want to add friction to the new customer experience; it’s important that getting set up is quick, easy and delightful.
  • Emergencies happen, so we don’t want to ever totally block the ability to top up with a card.
  • We want to find a model that is simple and easy to understand

I joined the team as a user researcher recently, so we’ve begun work with customers to test potential approaches. Today, we wanted to transparently update everyone with what we’ve done so far.

We started off by running a workshop internally where we came up with different possible charging models. As we discussed the pros and cons of each for the customer and for the business, three particular models stood out.

The first model used the concept of a free trial period. The idea is that you are given a few months warning that fees are going to be introduced, which gives you plenty of time to set up alternative methods of transferring money to your Monzo account that don’t incur a fee.

This trial period would also apply to new customers, so they could get used to Monzo before they were charged anything.

Free trial

The second model used the concept of a monthly allowance, similar to foreign ATM fees. The idea with this one is it would provide you with the option of topping up a small amount via your debit card for convenience, but the limited amount would encourage you to plan ahead and use free methods of transferring money to your Monzo account.


The third model – our wild card – used the concept of tipping, similarly to Wikipedia or The Guardian. Your debit card top-up would be free but you would be asked for a tip by Hot Chip, who animates and get progressively happier the more you give.

Tip jar

We debated. The first model felt the least complicated but somewhat rigid. On the one hand, it might encourage customers to move their salaries across to Monzo but it might also create too much friction if they’re not ready to make the jump and don’t want to keep using their primary bank to feed their Monzo account. On the plus side, it’s straight-forward and easy to understand.

The second model felt more forgiving but added a layer of hassle. Given the recent foreign ATM fees which carry an allowance, we didn’t want to burden our customers with having to remember their limits for different functions.

The third model was our altruistic love-child. We don’t want to charge fees, but we’re operating at a loss and need to cover our costs somehow. Could we rely on the generosity of a few individuals who would provide enough of a tip that would negate a lack of tips from others so we break even? How would people feel about tipping Monzo?

One of our talented product designers –– Vuokko Aro –– put together some design mockups into separate journey prototypes. We ran a number of individual task-based user research interviews with participants, asking them to go through the process of topping-up their account. We observed, probed and listened.

What we learnt was that the trial period model was too restrictive. Participants didn’t notice the explanatory copy and the fee came as a shock when it was imposed. Participants told us that they would keep using the debit card top-ups until they would be charged, and that it sat badly with them. Participants struggled to understand where the fee came from as they assumed that the debit card transfer was the same as a standard bank account, and therefore free of charge.

The tipping model was unrealistic. Although participants reacted positively to animated Hot Chip, they couldn’t see why they would want to tip a bank –– tipping is something reserved for exceptional, personal service and not for something that is expected, least so from a financial organisation. One participant said it made her feel guilty, which is certainly not something we would want to do. All of them skipped the page.

The model that came out as the most favourable for our participants was the monthly free allowance with an ensuing fee. Participants told us that it would encourage them to either move their salary across entirely, or budget and plan larger bank transfers ahead of spending rather than trickling money in small amounts from their legacy account into their Monzo one. This model gave participants more flexibility and control in case of unforeseen situations, which they liked.

Whilst there was a clear preference towards one pricing model in the research sessions, it doesn’t mean we’ve made a decision. This insight gave a us a lot to think about and some more detailed design problems to solve. We’re now going to work on refining our prototypes and seek more input and feedback from the community, whilst seeing how people make use of debit card top ups on the current account alongside bank transfers and the other features we’re building. We won’t be implementing any limits until at least after the New Year.

We hope this post gives some insight into the challenges we’re working through and look forward to hearing your thoughts!

Thanks for reading :slight_smile:


Well you’ve got my salary going in already so I hope I’m not costing you too much :wink:


Nope! That’s totally free for us :raised_hands:

@jonas has informed me I wasn’t quite right :stuck_out_tongue: (as usual). It costs us a tiny amount to receive payments, but it’s v small (like, pennies small). So close enough!


Speaking personally, this issue will go away once you’ve got your services to a level where I have the confidence to have my salary paid in. That involves better support for direct debits and standing orders, clarity on what happens when payments are processed overnight (particularly if they happen on my pay day) and in what order to avoided clashes and non-payments and seeing the service running without significant outages for a period that matches or exceeds what my current bank manage to provide.

Once I’m confident you can provide that, I’m in.


Challenge accepted :slight_smile:


Out of interest, does your current bank provide that info? Because that’s pretty cool info to get.


Are the fees proportional to the amount or is it a flat fee you have to pay?

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My salary goes to Monzo account and DDs also come out of Monzo so I hope that actually gives Monzo something back. I think banks make money from DD payments :thinking:

Perhaps that should be a Motto for the company i.e. always moving forward and up for a challenge. :slight_smile:

So the way I see it is this, the ability to topup from another card is a slight (very useful) hangover from the prepaid card since it was the only instant way to get funds in your account. Of course people found it useful for when emergencies happen and it would be a backward step to remove it completely.

First of all I’m going to say that I advocate the “charge the high users” policy, in a similar way to the international ATM fees, a free allowance wouldn’t stifle the occasional (emergency) users but shift the onus on those who are costing unreasonable amounts of money. Realistically with BACS and faster payments these days, bank transfers should be the norm because they are cheap and instantaneous (especially given that most banks now offer apps). I see no reason why card topups should be needed to be used regularly or have any particular advantage they have over transfers except that you don’t have to log into another app to send the payment (or you could set up a standing order).

I dislike the “free trial” or “tip” models, the free trial model I really dislike, free trials tend to be overused and as a way of luring customers in (like with subscription services), and I don’t think this is the kind of impression that Monzo should be giving off. The tip model to me whilst a lovely idea is going to be a hard sell to get people to pay when they could just not pay anything.

If going for a free limit model (like with the ATM issue), I’d suggest perhaps doing some maths and working out the cost per transaction on average and changing it to a flat-fee, I know this isn’t how you’re charged but maybe it might just help to differentiate it from the ATM fee allowance and requires no calculation on the part of the user.

tl;dr; I support a cap on the amount or number of free topups with a fixed pence (rather than percentage because its easier to understand) fee. It would shift the cost to those who use it unreasonably much in terms of cost and perhaps push them towards a cheaper alternative (if practical). Honestly, in this day and age a bank transfer is so quick and easy that I don’t see why except in exceptional circumstances you’d need to topup by card, especially not regularly.

Please feel free to reply if you are someone who does this frequently whilst it’s better for you than a bank transfer, I’d be interested to know because I can’t think of any particular advantages but may have overlooked something :slight_smile:


It would have maybe been helpful to have this information in the first place when you removed the debit card top up feature in the first place. I’m not sure there would have been quite as much anger if people had known that you removed it for a reason (costing you money) rather than it being difficult or an oversight as were the assumptions.

I know you can’t consult the forum about everything, but in order to be as transparent as you can be, sharing a bit of info like this at the launch of current accounts would have been an easy fix and avoided lots of bad feeling.

It’s good of you to share the info now, thanks. However, i am a little concerned about big decisions like this (and the ATM fees as another example) being made on the basis of a vocal minority on the forum that don’t necessarily represent the bulk of the users. It’s good to have passionate people here giving feedback, but sometimes I don’t think they represent the views of the many.

Personally, I don’t mind Monzo staff making decisions about the way their business is run and would much rather have those people making decisions in possession of all of the facts & future plans, rather than turning it over to a small bunch of people on the forum to make suggestions on singular issues with limited information.

Just my thoughts.


I wonder if showing costs of card topups could make a difference. So for every top-up transaction with a card, there’d be a line in the feed that says “this top-up cost Monzo $xx.yy”. And when a user clicks on it, there would be a breakdown of the costs in the transaction that also makes it clear that Monzo didn’t charge the user for this, but instead absorbed the cost.

This is kinda similar to the tipping model, but would aim to simply reduce the usage of card top-ups as opposed to asking for a tip. A little bit of guilt tripping, but with transparency :wink:


Hey Mike,

The fees are a percentage of the top up amount. Which means small emergency top ups are more manageable, but large salary-esque top ups are much preferred via faster payments or direct credits.


Easier just to charge say £5 a month and then levy 50p per top up or ATM withdrawal.

I’m not surprised by this - it does seem unrealistic to make it free, which will essentially cancel out any money you make from interchange fees when people use their Monzo card. It really makes me question the business case for Revolut or Curve. I’d be ok with paying the fee for the convenience if I were using Monzo. Generally, passing fees onto the user with no markup seems pretty fair.

If you’re planning to bring in a fee at some point though, I really think you should probably stop emphasising to people that they can use the CA in exactly the same way as prepaid.


This would be amazing, and I think also pretty much remove the need for debit card top-ups for the vast majority of people.

My preferred option would be for you to remove top-ups entirely. ‘Legacy’ banks don’t have them, so it’s not an expectation of a banking service. Of the three options, the least worst is the fee-free allowance. But I worry that more fees are creeping in that people have to keep track of, and one of the attractions of Monzo is not having to remember which set of actions is going to result in being charged.

The other two options aren’t attractive: trials can also induce a mild panic that you have to ‘properly’ test something before the trial runs out. And asking for tips is going to come across as cynical to a lot of people since you are a bank and not a charity.

So I come back to feeling that the best option is no top-up support. If you were able to wait until the app can allow for initiating transfers from another bank using PSD2 and then remove top-ups, I think that would be a reasonable replacement. Immediate ‘top-ups’ from within :monzo: but using inter-bank transfers.


Hey Dan,

Thanks for this feedback! Debit card topups were missing from the current account not because they were intentionally removed, but because we needed to make changes to our systems to route money to a current account instead of a prepaid card, but wanted to get feedback on the new features like bank transfers as quickly as possible.

A big part of why we are testing ideas around fees with user research is to try and avoid some of the biasses you mentioned regarding vocal minorities. We’re striving to talk to representative sample of Monzo customers, as well as people who have never heard of Monzo before.

Hope this helps!


What about people who don’t use ATM withdrawals or card top ups? Why should they be charged £5 to allow others to do it?

I’d go for the allowance and then charge for levels above that. As with any feature, it should really be the heavy users of that feature that pay for it rather than them being subsidised by others.


Also, will this affect I know that’s a different feature, but presumably the same costs are involved. If a limit+fees were brought in for top-ups, would the same apply to payments? Or is this more manageable because the per-transaction amount for is limited?

If this is too far off topic, just let me know and I’ll start a new thread.


Correct :slight_smile:

Stripe is the payment processor, Stripe charge a % for every transaction they process.

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Good question Jolin. We’re not sure about yet, it’s part of our considerations though. The per-transaction limit (and overall monthly limit) make it less of an immediate concern, but something we’ll need to address before making any changes.