This week UK digital challenger bank Monzo announced it was introducing a 3% charge on cash withdrawals made for international ATMs, after a free 30-day allowance £200. Most debit card issuers charge a fee for off network cash withdrawals but some do not, depending on the country. Having a £200 charge fee limit is a nice addition to the Monzo card offer. Users of the prepaid account will be charged 3% on any withdrawal so expectations are for their customers to migrate over to the new account structure.
“If you’ve already upgraded your account, you’ll be charged 3% on cash withdrawals you make at any ATM abroad, after a limit of £200. This limit is applied over a 30-day rolling period, and you can make as many withdrawals as you like up to a total value of £200 without charge. So, if you withdraw £200 from an ATM in Moscow on the 1st of May, any subsequent ATM withdrawals you make while you’re abroad in the next 30 days will be charged at 3%. After 30 days (in this case on the 31st May), you’ll be able to withdraw up to £200 abroad again free of charge.”
“You can always see how much of your free allowance is left in the app, and we’ll show you clearly how much you’ve been charged on each withdrawal. Our goal is to build a viable business that’s here for the long run, supporting our customers and working to make banking better. Every time a Monzo user withdraws cash from an ATM outside the UK, we pay the ATM owner a significant fee. We had previously paid that fee ourselves, but last year it became clear that continuing to do so would be tricky. These charges do not help us turn a profit. Together with our community, we wanted to find a reasonable, sustainable way to cover these costs.”