I was just wondering when you get your full unlimited banking licence, whether you will keep a pre-paid card facility? I find them really useful when travelling, as I don’t have to worry about my main card being compromised with access to large sums of money. If not, a dual account with two cards, so that only small sums need to be transferred to one card for use in places where you might have concerns about security.
Here’s what Tom’s said about this
Thanks Alex. I dislike handing over a card that may have five figure sums available when I’m travelling. It’s annoying when you’re in the middle of nowhere with poor cell service to find out your card has been cloned and you need to deal with it asap. I guess I’ll be keeping my Cashplus one instead then.
I obviously didn’t make myself clear. I can do it now with the Monzo prepaid card but I’m not going to be able to do it if they discontinue it or if they don’t offer dual cards.
Do you think this could be solved with a temporary spending cap feature?
Apologies, if this thread doesn’t now make sense, Alex deleted his original reply.
I’m afraid a temporary cap doesn’t help. Let me give you a real world scenario, hopefully that’ll help explain what I mean.
I’m off to Taiwan for a month on business. I transfer £10,000 to my current account for the trip. However, I do not want to use my card where that £10,000 is held anywhere outside of a banking hall or similar. Therefore, I want to transfer what I need for the day, say £500 to another card, so that if it is in any way compromised, I can simply stop using it and the risk is only for the amount that account holds.
Does this make sense?!
Once your pre-paid card is compromised, what do you do? Am I missing something :-/
V.clear! Perhaps Virtual Accounts will solve this then?
Check out this thread:
You use your main card in a banking hall or similar to withdraw cash whilst awaiting a replacement card for the compromised account.
Unfortunately no, not unless Monzo is issuing cards for the virtual accounts.
A second physical card should not be necessary. Also check out this thread and @MightyAx’s comment
Thanks Saveen, yes, if the card can be switched between accounts within the app, that’s perfect!!!
The caveat on the second thread, is that example shows virtual accounts aren’t truly separate in the real world, they are constantly pulling from the same pool of funds.
and pre-paid card is not for 5sum to spending there a limit of like 1k a spend
Sorry, I have read through your comments again and understand your concerns which I think apply to all debit cards in general in higher risk scenarios.
So what’s the answer? I think there are two arguments:
Maybe not 2 sets of cards / card numbers but many like Final.
To build better fraud prevention mechanisms and rely on consumer protection for unauthorised payments.
And a solid counterargument to Final’s approach:
From my point of view, as a customer, it’s only a real nuisance. If my main card is cloned and the thieves spend £10,000 in a local Apple store, it’s Monzo who would have to pick up the bill, I’ll eventually get a refund. However, when travelling, it’s the eventually that becomes the issue. I much prefer to transfer a day-or-two’s worth of funds when I’m travelling onto a pre-paid card. This obviously goes back to my original question, whether or not Monzo would keep pre-paid. I would have thought that given the fraud epidemic, that Monzo losing £500 - or nothing if that were in the conditions of use - on a pre-paid as opposed to £10,000 on my current account card, would actually be a benefit to them. It could also be a great marketing opportunity geared towards those who travel, that Monzo allows you to move funds as needed onto a separate card, so your main account can never be compromised. The Final solution of generating a new card number per transaction also looks awesome.
Yep, you raise valid points but because of the operational complexity mentioned by Tom I think it’s unlikely that pre-paid and current accounts will operate concurrently.
Fraud protection features like Revolut’s, which can be turned on/off, will help though:
- Magnetic stripe transactions
- Online transactions
- Geolocation (location of phone vs. transaction)
I agree, it seems that the Monzo team are also fans of Final so watch this space!
Final is certainly interesting. The problem of fraud protection on most accounts is that you’re still suspending the entire account if fraudulent activity occurs. This creates the problem of being unable to access the account until new cards are issued which is worthless whilst you’re travelling unless you’re offered an Amex style global courier service. It can also leave all your direct debits and standing orders bouncing which can subsequently wreck your credit history.
I’ve had a main account compromised and having suffered from the fiasco that ensued, I now no longer use my main account card anywhere but inside a major banking hall. If I’m anywhere else or online I use prepaid.
Fraud protection on debit cards means freezing the card but not the whole account, surely?
Not sure what others think, but I agree, being without a card when travelling is an inconvenience and you have raised a solid case for Final style protection!
You’d think, huh?
However, HSBC froze my entire account whilst I was in Japan due to fraudulent charges via my debit card. I believe it was cloned when I’d used it a few days earlier in the Philippines. This happened to be towards the end of the month, so many of my direct debits got bounced, which trashed my credit rating. I had to pay to put notices on each failed payment, explaining the situation, but it didn’t help, took years to recover my 900+ rating, fortunately I didn’t need a mortgage or loan in the interim!! I’ve always used pre-paid cards since then.