Monzo and Revolut are two UK-based challenger banks with very different approaches. Monzo offers a range of useful banking features and services to its customers. Revolut is another popular challenger bank, but there are some important differences between the two. In this in-depth review, we will compare Monzo and Revolut, so you can decide which one of the two might suit you best. Read on to see how they stack up with each other across several areas.
In This Guide
What Is Revolut?
Revolut is an app-based bank that offers access to a full range of payment and banking services to individuals and businesses. It was founded in 2015 by Nikolay Storonsky (a former equity analyst at Credit Suisse) and Vlad Yatsenko (a former Deutsche bank app). Today, the London-based app has amassed more than 14 million users worldwide.
Revolut works just like a traditional bank but all of its services are available solely via the app. To get Revolut online banking services, you need to download the app from the Google Play Store if you have an Android phone, or the Apple App Store if you’re using an iPhone. You can then sign up for an account and receive a card to pay with, either as a virtual card on your phone, or a physical card which you will get sent in the post, or both.
Revolut offers four different accounts: Standard (free), Plus (£2.99/month), Premium (£7.99/month), and Metal (£13.99/month). Users can also save money, send money abroad, and trade stocks, commodities, and cryptocurrencies using the app.
Revolut features a commission-free stock trading platform, which gives customers access to more than 200 ETFs and 1,100 securities listed on the New York Stock Exchange (NYSE) and NASDAQ exchange.
The platform hosts real-time stock charts, price alerts, market news, performance data and graphs. Revolut customers can trade full and fractional shares directly on the app. Unfortunately, the app does not support margin trading, which is a risky strategy that involves borrowing money to purchase and trade shares.
On top of that, Revolut has features that enable users to set savings goals and monitor their spending habits. What’s more, the app allows users to top up their accounts via credit or debit card, bank transfer, as well as Apple or Google Pay. On the flip side, it does not accept cash deposits or cheques.
Revolut is regulated by the Financial Conduct Authority (FCA) in the UK and licensed as a bank by the Central Bank of Lithuania. Under its Lithuania banking licence, Revolut currently allows customers to transfer money to over 50 countries using more than 30 currencies.
Revolut Pros and Cons:
- Low international bank transfers
- Good currency exchange rates
- Supports more than 30 currencies
- Intuitive user interface and robust security features
- FDIC insurance on cash deposits
- Revolut users can trade cryptocurrencies through the app
- Lacks full UK banking licence
- Low limits for fee-free cash withdrawals even in the UK
What Is Monzo?
Monzo is another popular digital bank that has managed to attract millions of customers in the UK, thanks to its impressive features. Like Revolut, Monzo was founded in 2015 in the UK and was one of the first app-based mobile banks on the market.
Tom Blomfield, founder of the app, originally designed it as a type of pay-as-you-go travel card. Monzo’s bright coral cards are noticeable from a mile away.
The platform currently has three types of accounts: Free, Plus (£5/month), and Premium (£15/month). You can also open a business account, a 16-17 account and a joint account.
To create a Monzo account in the UK, you need to be at least 16 years old. You also need a smartphone and valid proof of identity in the form of a National ID card, passport or driving licence. Simply download the app on the Apple App Play or in the Google Play Store and enter some personal details such as your full name, date of birth and home address. Monzo will then ask you to submit a selfie video and a photo of your ID in order to verify your identity.
After the verification process, Monzo will send your card and it should arrive within a couple of days. However, if you cannot wait to use your account, you can add your card to Google Pay or Apple Pay and use it instantly.
To top up your account, you can make a bank transfer, or use Apple or Google Pay. With Monzo, you receive instant notifications every time you use your card as payments are processed much faster compared to a traditional bank. Monzo customers also don’t pay any fee when they make online transactions in a foreign currency or use their cards abroad.
However, you’ll be charged a 3% fee if you withdraw more than £250 in 30 days in the UK or European Economic Area. Additionally, if you damage or lose your card, you will pay £5 for a replacement.
Monzo allows customers to create “pots“. A pot is a space in your account where you can separate out your money from your main balance into smaller accounts specific to different needs. This feature is really useful if you want to save for a holiday or something special. You can save money in a pot so that you don’t spend it from your main balance.
As well as saving and budgeting, Monzo users can get loans up to £25,000 and overdrafts up to £2,000.
Read full Halifax Review in our other article.
Monzo Pros and Cons:
- Users can earn interest on their savings
- Monzo is a fully-licenced bank in the UK and customer money is protected by the Financial Services Compensation Scheme (FSCS)
- There are no charges to open a current account
- It is convenient to manage, spend and save your money
- No physical presence or branch network isn’t great for people who prefer face-to-face customer service.
- Daily spending and withdrawal limits
Who Is Revolut Best For?
Revolut is best-suited for frequent travellers, business persons and freelancers, who are always on the go. It is a great way to take money abroad especially if you just want a prepaid card to use. The app offers free currency exchange and gives users the ability to hold multiple currencies on their accounts. With Revolut, all your money is stored in British pounds, but you can still use your card abroad without paying any extra fees.
Revolut’s ability to send and receive international money transfers is hard to beat. For example, if you’re using its free account, you can exchange up to £1000 a month without paying any fees provided you complete it Monday to Friday. On weekends and bank holidays, Revolut charges 1% for money currency exchanges as the markets are closed.
Who Is Monzo Best For?
Monzo is a great choice for people who want a convenient and easy way to make purchases, budget, save, and manage their money. It is a handy app that makes banking understandable, approachable, and friendly. You’ll not incur any charges for money currency exchange if you pay with your Monzo card overseas. Revolut, on the other hand, will charge you 2% on your transactions if you go over $6,000 in a month.
Monzo comes with useful features for managing money from splitting payments with friends to its foreign currency services. Monzo’s “pots” feature is also a superb way to save money and work towards certain financial goals. What’s more, Monzo is a fully-licensed bank in the UK and offers deposit protection for the customer money it holds.
Which One is Better?
There isn’t a better challenger bank; it is mainly a question of which is more suitable for you, based on your needs and preferences. They both have pros and cons, but if we had to define the two apps in a nutshell, Revolut is the ideal option if you want to hold, spend and transfer money in different currencies. Plus, Revolut offers various financial assets to invest in, including stocks, commodities, and cryptos. Monzo, on the other hand, is the better choice if you’re looking for a fully regulated digital-only bank offering traditional features such as overdrafts and loans.
FAQs
Monzo is headquartered in London, United Kingdom.
Revolut is partially owned by Storonsky and Yatsenko. Other key investors in the company include private equity firm Tiger Global Management and Japanese conglomerate SoftBank.
Yes, you can transfer money from Revolut to Monzo. All you need to have is the recipient’s Monzo account and routing number.
There are no fees required to sign up or use Monzo within the UK, even when withdrawing from ATMs. This is also true if you are using the app abroad. However, you’ll be charged a 3% fee if you withdraw more than £250 in 30 days in the UK or European Economic Area.
No. Besides being available for UK nationals, Monzo is also available to US residents. The digital bank began offering its services to customers across the US in February 2022.
Absolutely. You can use both your Revolut app and card in the UK. You can also use Revolut in the US.
Although Revolut is not a regulated bank in the UK, customer money is held in segregated accounts with Lloyds or Barclays. Therefore, you would be able to claim your funds from these ring-fenced accounts in case Revolut becomes insolvent.
You have to be a UK resident to apply for a Monzo card. Monzo also has daily spending and withdrawal limits.
Conclusion
In a comparison of Monzo to Revolut, the true winner may be the banking app that fits your needs best – whether it’s low fees or real-time payment notifications. Each of them has at least one standout feature that makes it an excellent choice for certain types of users. We recommend taking a deep look at the features and deciding which app seems most appropriate for your needs.
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