Yeah, it makes sense in case the profits are closely related to the USP. However, I don’t see how that works for Starling - whether they have people on their (mostly loss-making) consumer division doesn’t affect their business-grade payments division which is the one bringing in the profits.
That’s true. But I guess (although it is only a guess) that Starling will have a reasonably large number of customers who use their account exactly in the way that you describe. I certainly use my starling account for 2 purposes only: to withdraw cash abroad (although the age of world tours is sadly well and truly behind me), and to withdraw cash from my curve rewards balance.
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or just like some fintechs, have not a monetary limit but a number of free withdrawals per month or a cash fee (an amount not percentage) per withdrawal
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I agree I’m just thinking selfishly.
I remember egg did it because people werent getting into enough debt!
Do I read this correctly?
Restrict my free foreign ATM usage, in order to be able to keep free ATM usage??
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More, purge those abusing it. I’m not saying to do it. I’m saying if it started costing too much, I’d simply filter it by those who solely make foreign transaction and cull/restrict first. 
Don’t get me wrong, I use it A LOT for that, but I also pay my salary in and use and overdraft sometimes. So I’m probably cost neutral.
Or free overseas cash withdrawals for those having at least one direct debit coming out of that account every month spending at least £200 at points of sale, and at least 3 months of account usage before they become available. For everyone else, it could be something like £200 free, 3% afterwards (like Monzo does it).
Why on earth would any competitor want to do it “like Monzo does it”!? surely if they ever had to do something like that they would want to make it appear better such as a £400 limit or 1.5% … to go for the same level would not give them any advantage, which is what any business will want.
But a low-ish limit would ensure that there would be absolutely no incentive to abuse the free withdrawals unless you actually want to use the account on a daily basis. And on the flip-side, it would provide people with an incentive to use the account regularly, given that they know that they will then benefit from overseas cash withdrawals if they are frequent travellers.
I think this was debated before when Monzo introduced the different choices for ATM fees. A lot of people did suggest something like this, eg regular users/ certain amount of spend but it was also pointed out that this could become unfairly skewed for people who can’t afford to do that. Would be difficult trying to pin down a specific number to pin this at 
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What I find interesting is that Monzo thinks it’s okay to charge people a % fee on overseas cash withdrawals but this is a big “no no” when it comes to overdrafts, because of the “transparency” bs. I don’t see the logic here and it seems as though it just a way to hide the high overdraft fees!
Just like we’re not able to upload our own pictures for pots because it gives people the ability to upload indecent images, but it’s okay for us to upload our own profile pictures or whichever picture we wish as a receipt. It just doesn’t make sense.
Monzo, explain yourself!
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Disagreed about the ATM fees vs overdraft pricing.
Unclear overdraft charges can be dangerous as you often use the overdraft when you’ve got no choice, and not being aware of how much you’re actually going to pay would make your situation worse, so it’s a priority to make those charges clear. Whether the current overdraft charges are high or not is another debate, but we can’t argue the fact that the overdraft charges are clearly displayed in the app.
ATM charges is another thing; you often aren’t in a bad situation if you’re withdrawing enough to exceed the fee-free allowance, so a few quid more or less isn’t really going to matter.
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Well, after being accused of trolling just for being critical of Monzo let me play devil’s advocate here:
Despite disagreeing with fixed overdraft fees, I don’t think you can compare interest rates to percentage based fees:
3% fee on a £100 withdrawal is £3. While the math may be slightly more complex if you withdraw £85.96, the principle still stands, that it’s quite easy to calculate, and ultimately still a fixed amount.
Interest is a different matter: on the one hand there is often some lack of clarity about the precise amount of overdraft at any given time, which is less of an issue with occasional atm withdrawals (thought that needn’t be the case with monzo). But more importantly, because interest compounds the math (while still not rocket science) becomes more tricky, and the interest is no longer fixed. A hypothetical daily rate of 3% suddenly doesn’t mean you pay £3 per day for being £100 overdrawn, but on day one its £3, on day two you pay £3.09, on day three £3.18, etc. And the compounding effect is easily underestimated - I’d wager that a lot of people would instinctively approximate a “3% per day” rate as “£3 per day per £100 borrowed”, which it clearly isn’t if you borrow for more than a few days.
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If overdraft was percentage based, Monzo will know exactly how much interest you will pay at any given moment, and this could also easily be displayed in the app.
In fact, they could even go a step further and estimate the interest which will be payable and tie this in with summary as it develops!
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I think you’re confused. Overdraft interest is shown per year. No bank charges a per day interest rate. I don’t know why you’re quoting per day.
In your example the 3% will be the EAR (Effective Annualised Rate) so being £100 overdrawn for 365 days would cost £3.
Starling’s rate is 15% EAR so being £100 overdrawn for 365 days would cost £15. It would compound up to £15 over the course of the year.
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EAR is Effective Annual Rate. This alone tells you that it’s not calculated annually. Most institituions calculate this daily on your closing balance.
I think you’re the confused one mate 
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Starling calculate their interest daily on your closing balance and do use EAR not APR.
Their methodology according to their staff member Sarah Guha is:
“We calculate interest on the cleared account balance at 00.00. The time is the time in London (so sometimes GMT, sometimes BST). We don’t take into account whether a day is 23, 24 or 25 hours long based on whether you’ve put the clocks forward or backwards. Instead the interest calculations treat a day as being (1/365)th of a year or (1/366)th of a year (depending on whether the day falls in a leap year or not).”
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having high 50p a day charges isn’t going to make it any better. Anyone who is in that position shouldn’t be switching to Monzo because if they care about clear pricing they’ll surely know they’d be better off elsewhere…
I’ve said this before but when I’m using credit I know clearly my Amex is a lower % than every other line of credit I have abs therefore will be cheaper without knowing anything about exactly what I’d be charged. Who goes into their overdraft planning what their charges will be seriously?
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I wasn’t replying to you, but to the post above.
This appears to incorrectly apply the 3% interest daily in order to make the argument that compound interest can increase. Interest is calculated daily but only added monthly (so compounding interest does occur over the year) but doesn’t start at 3% and increase, it starts much lower and compounds up to a total of 3% of the debt across the year.
https://community.starlingbank.com/t/starling-ceo-anne-boden-awarded-mbe/5749
Well done Anne Boden. A big win for the challenger bank movement.
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