The emergence of digital banks has transformed the finance market as they have advanced the management of finances from mere accessibility to enhanced features that enable spending and saving insights. Digital banks do not necessarily have physical branches as they aim to provide banking services from anywhere in the world through the use of technology including mobile apps and the internet.
Monzo and Revolut are among many digital banks in the UK that offer access to app-based financial services. They both offer financial services to people overseas making it easier for non-UK residents to transact money.
Let’s explore the features of each bank, their differences, and the services they offer.
Monzo is an app-based bank incorporated in the UK. It was one of the first fully functional mobile app banks in the UK that has been established to offer more modern and convenient banking solutions.
This online-only bank was founded in 2015 in the UK under the name Mondo and offered its customers prepaid Mastercards which could be recharged from any other bank’s account.
In 2017, Mondo turned into Monzo after it became a licensed bank. It offers various bank accounts with monthly fees and debit cards.
Monzo’s premium plans include:
Revolut is a financial technology company that provides a variety of banking services via a mobile phone application. Since its inception in 2015, Revlout has been issuing multi-currency cards to its clients and offering them several monetary instruments to better handle their finances.
Monzo
Monzo offers personal and business current accounts along with cards that enable free international usage. Personal banking customers can either apply for a no-annual-fee bank account or opt for three bank accounts with a monthly subscription. The advantages provided with each account vary according to the usage of Monzo as either a main current account or as a backup account. Monzo accounts can be used with Apple as well as Google Pay.
Customers holding cash in the free and extra accounts can earn a variable interest rate of 4.1%. For Perks and Max accounts, the interest rate is 4.6%. Additionally, Monzo offers a limited selection of fixed-rate savings and investment options.
Monzo has budgeting tools that provide detailed spending insights and budgeting features.
They are regulated by the Financial Conduct Authority (FCA) in the UK, the deposits are safeguarded up to £85,000 under the Financial Services Compensation Scheme (FSCS).
Revolut
Revolut offers both personal and business accounts, together with an international spending debit card with no additional fees. Revolut accounts support both Apple Pay and Google Pay.
The app has various types of accounts available, starting from a free one exceeding four monthly paid premium accounts. It enables Money transfers in more than 80 currencies to 160 countries such as HER countries. It enables users to send funds to another Revolut account free of charge, but transfers made via a card or bank account are subject to remittance or transfer processes.
Currency handling: Revolut excels in multi-currency accounts and international transfers, making it ideal for frequent travellers.
Money security: Monzo has been granted authorisation and is under the regulation of the Financial Conduct Authority (FCA) as a bank. This gives customers coverage for losses of their deposits up to the amount of £85,000 for each individual through the Financial Services Compensation Scheme.
Revolut does not possess a banking licence in the UK, thus it is not covered by the FSCS.
Investment options: The investment capabilities that can be accessed through Revolut are even more extensive.
Deposits: While Monzo accepts cash and cheque deposits, this is not a feature that is available within Revolut.
Fees: Monzo has various premium accounts with monthly prices ranging from £3 to £17, but when it comes to Revolut, the subscription accounts are offered with prices ranging from £3.99 to $45 per month. Monzo permits free ATM cash withdrawals across the UK and EEA territories up to the value of £400. A fee of 3% is charged on any amount over that, where Monzo is not the main banking app. There are fee-free unlimited withdrawals all over the UK and EEA countries for users having a Monzo account as their main one or having a premium subscription.
Revolut imposes a 2% fee, with a minimum charge of £1 per withdrawal, on UK withdrawals that exceed £200 in a month or surpasses five withdrawals within the same timeframe, depending on which limit is reached first. It is important to note that Revolut does not provide overdraft services, whereas Monzo offers overdrafts with interest rates ranging from 19% to 39% EAR.
Revolut
Currency exchange: Provides current and up-to-date foreign exchange rates which are usually more favourable than the ones offered by banks.
Cost: Charges low rates on interbank transactions especially for customers with premium accounts.
Ease of service: Remittances are carried out daily for several currencies without fail, within a few minutes.
Geographic presence: Accepts wire transfers for over 150 countries.
Extra advantages: Makes it possible to send money to other account holders instantly and at no cost.
Monzo
Exchange rates: For cross-border money transfers, the organisation uses Wise (previously called TransferWise) which gives the advantage of better rates.
Fees: Transfer fees are laid out clearly, and advance payment of the transfers is inclusive of the fee to be charged.
Speed: Transfers are usually very quick, with most transfers in major currencies done within 1 day.
Coverage: Permits remittance to 70 countries.
Additional features: You are also able to arrange for periodic payments and direct debit authorisation for scheduled payments
To choose either of the two digital banks, you will need to weigh your specific needs and preferences.
One can choose Monzo if they need;
One can choose Revolut if;
In conclusion, both banks offer digital services with enhanced features making it more than just a platform for transactions. Whether to choose Monzo or Revolut for your day-to-day transactions will depend on your specific needs and wants.
Want to open a UK bank account? Icon Offices got you covered. We have partnered with many banks where you can directly open a bank account regardless of your location and access fast and hassle-free banking services. Our services cater to both UK and non-UK residents with cash rewards.
For more information, contact us at info@iconoffices.co.uk