Yesterday it was announced that Monzo would be changing their policy on overseas cash withdrawals. I have noted a fair few people across linkedin taking delight in this “setback”….. Lots of “Not so free anymore” and “RIP Monzo”. Understandably this is the extreme end of the scale but I find people’s speed to take any opportunity to knock an innovator, especially in the backward world of consumer finance disheartening.
On 13th September, Monzo, via their monthly journal and blog asked their customers to help with a decision around pricing for overseas cash withdrawals. The cost of cash withdrawals to Monzo (them swallowing the fees charged by banks) had risen from £6 to £16 per customer in just over a year (June 2016 – August 2017).
From here users were asked to vote on three solutions that users felt best suited them, on the understanding that most, like myself were not in the small minority that were using Monzo solely for cheap access to cash whilst abroad (13% of users account for 85% of transaction fees), but also for the wider tech related services.
The options were as follows:
1% charge for ATM withdrawals in Europe, 2% charge for withdrawals Rest of World
1.5% charge for ATM withdrawals everywhere outside the UK
£200 free allowance per month, 3% charge for withdrawals thereafter everywhere outside the UK
Another smart idea that Monzo hasn’t considered
With the “winning solution” “Option 3” being announced yesterday, Monzo have dealt with a tricky growing pain with the product, at a time when they are in beta for the whole banking product (Launched to the public in the next month), in one of the most human ways possible. The core reason for Monzo; the tech platform and customer service, remains the same and the solution for overseas cash withdrawals is still market leading, albeit by a lesser margin than before.
To paraphrase Alanis Morissette, isn’t it ironic that the faceless tech bank, Monzo is leading in customer service and treating its users like rational humans!