What are ‚digital banks‘? How can I create an online banking account? What are the pros and cons? Who actually offers these services and who shall I choose? This article answers the basic questions you may ask when you start to think about getting an account elsewhere than in traditional bank institution. They are cheaper, more efficient, safer, more flexible and sexier.
Cheaper: Free bank account with way cheaper exchanges from or to other currencies.
More efficient: With the application and innovation comes also a way of new bonus services, see below.
Safer: You can just send little amounts of money from your main account on this card, which means that in the case of card loss, nothing happens. You can easily freeze the card in your mobile app.
More flexible: The possibility to have multiple currencies and immediately exchange them allows you to cross out the time spent in an exchange office before you go abroad.
This list also answers the question, why are these cards and digital accounts mostly used by people who travel a lot, or investors, who often need to exchange money and hold several currencies.
How to start?
Everything begins with the download of a mobile app. All you have to do is to fill in the requested data and order a card, that will be delivered on the given address. Every provider differs a little bit in services, he offers. We have prepared an easy comparison of three actual offers, from which you can choose the one that suits your needs the most.
We have tried accounts and carts from companies Revolut, Monzo and TransferWise. The gold standard contains bonus possibilities, such as currencies exchange, withdrawals abroad, easier transactions to your friends, freezing the card in your mobile app, and other options you can see in the table below.
ONLINE ACCOUNT
Revolut
Monzo
TransferWise
Mobile app
Card
Freezing the card
iOS & Android
Security
Touch ID; PIN; possibility of GPS check; FCA
Touch ID; PIN; Face recognition; FSCS guarantee up to 85 000GBP
Touch ID; PIN
Design and interface
Very sofisticated
Very sofisticated
Needs to be tuned up
Card order
4.99 GBP
Free
Free after putting 20 GBP on the account
Notifications
Cash witdrawals
200 GBP/month for free, 2% fee when going over the limit
200 GBP/month for free, 3% fee when going over the limit
200 GBP/month for free, 2% fee when going over the limit
Paying abroad
No limit or fee, according to the current exchange rate
No limit or fee, according to the current exchange rate
Fee 0,35-2%
Support
FaQ; Chat; Blog; Community
FaQ; Chat
FaQ
Deposits in
GBP, EUR, USD
Only GBP
Only GBP
Bank details for
GBP, EUR, USD
Only GBP
GBP, EUR, USD, AUD
Number of currencies
130+
Non specified
40+
Transactions between accounts
Bank transfer; Immediate payment to friends
Bank transfer; Immediate payment to friends
Bank transfer
Bonus services
Overdraft; Recurrent transactions; Travel Insurence; Buying and holding Cryptocurrencies; Investing coming soon; current exchange rates
Overdraft; Recurrent transactions
After examinig and trying all providers, their services, mobile apps and cards, we have compared them and come to a conclusion…
Revolut
Revolut offer very complex and tuned service. The main advantage in comparison to others is its wide scale of bonus services. They are the first and only one so far offering the possibility of insurance – travel and ‘for devices’, such as mobile phone. Right in the mobile app, you will have the possibility to buy cryptocurrencies, save money (by rounding up purchases according to your settings, the application saves your money to a vault), get credit when you happen to be in a financial crisis. The possibility to invest is going to become a part of this offer soon.
All your expenses and budget overview are graphically displayed in a very easy and friendly way. Your transactions are automatically categorized, which means that at the end of the month you can evaluate your expenses without tiring manual writing down of every transaction, either to your notebook or to an online app (Of course these categories are not as complex, but sufficient for the need). You can also track the actual exchange rate of the currencies you choose.
Revolut offers customer support in forms of Chat, users community and blog articles. We have a positive experience with the support. It reacts quickly and friendly to all questions. Revolut is making use of a chatbot Rita that at first tries to answer your question from the FAQ questions. Shall it recognize a new question; it is going to offer a reconnection to live agent. Overall, support works very well, good job!
Revolut also offers an upgrade to a premium version, which is paid for. The premium account is going to cost you 6.99 GBP and will increase your monthly limit of free withdrawals from 200 GBP to 400GBP. Next up is an offer of free health insurance abroad, priority support 24/7, and many more. In our opinion, the basic account is sufficient for a usual user.
After the long list of advantages, it is time to have a look at some disadvantages in comparison to Monzo. Customers have to pay to shipping for getting the physical card (4,99 GBP), while the digital card is for free in the app. Revolut has a slightly different approach to security. Monto is cooperating with FSCS that “guarantees the account up to the amount 85,000 GBP”, while Revolut cooperates with FCA (The Financial Conduct Authority) to increase security. There are options to freeze your card, use a TouchID, PIN and also a location-based security that can decline a transaction if the location of your phone and the shop you use your Revolut card in didn’t match.
Monzo
Monzo offers a very nicely graphically made mobile app, friendly interface and welcoming animations right after launch. Everything is explained step by step. The app provides the possibility to have a look at your expenses in a simple graphical budget. Other features include freezing your card, withdrawals abroad up to 200GBP, notifications on your phone, chat support, credit and the possibility to quickly transfer money to your friends. However, all these features Revolut offers as well… So what is Monzo doing better, or differently?
One of the major pluses is card delivery for free, thanks to which you can try out digital banks without paying any fees. Unfortunately, that will be it… Another difference would be its cooperation with FSCS (The Financial Conduct Authority) in security, with which you are guaranteed up to the amount of 85k GBP. The offer of bonus features is significantly missing in comparison with competitive Revolut and although Monzo cooperates with Transferwise, it has currently the highest fee for exceeding the limit. Also transferring money to your card takes longer in comparison to the card by Revolut.
Transferwise
Although Transferwise provides a very useful and well-working service in the area of currency exchange, they are currently very behind its competitors with a digital account. So far Transferwise offers very limited and expensive alternative that counts on its customers’ loyalty. Yes, they do offer bank details and holding four currencies (GBP, EUR, USD, AUD), but nothing else.
We have tried the mobile app as well. Its options are very limited, it misses extra services and the design of the interface needs to be tuned. All that coupled with fees for transfers makes it very difficult for TransferWise to be a relevant competitor for the current market.
Paypal
Quite surprisingly, Paypal is not taking part in the market as yet with its own product. We expect this big player to come up with its own product and we are going to inform you about it.
Summary
To sum it up, we have compared all the available information and listed the mentioned digital accounts together with one or two most important characteristics. All plusses and minuses considered, Revolut currently offers the best and most complex service while Monzo is trying to catch up with it.
- Revolut – the widest offer of services and possibility to upgrade to a premium version
- Monzo – Playful design and free card delivery, less extra services
- Transferwise – Currently very behind its competitors
- Paypal – We are looking forward to what this player is going to offer
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