Are you familiar with that moment when your holidays are coming up and you are thinking of the best way to avoid bank fees? Thinking of withdrawing a huge amount once there to pay these fees only once. Also, you need to tell the bank about going away lest they freeze your card while abroad, leave you in chaos to get any money out of your account. Traditional banks are not made for the times we live in, where travelling is more accessible than ever before.
Until around 2016, there was no way around it. Banks, as we traditionally know them anyway, all charge fees. Lucky for us, new 21st-century banks have been allowed to launch throughout Europe. They welcome you to free international banking, that you can set up for free in less than 5 minutes from your smartphone and that will make you feel like you truly live in the present times, not the past.
The following services provide you with a current account, just like your normal old-school bank would and a Visa or MasterCard debit card to use it.
Monzo has launched based in the UK. With them, your money is FSCS protected, just as it would be with a traditional bank. Obtaining a debit card is free, making the whole process of opening an account and having a debit card completely free and doable from your smartphone. When you receive your card you will be able to use it right away. You can choose the card pin before you receive it. You can pay with your card in any country and any currency, and it will convert your pounds automatically using the normal current conversion rate – that is, not some marked up rate, but the actual current currency conversion rate. You get a sort code and an account number like with any traditional bank. It is essentially a normal UK bank account that you can even be paid by your employer into. Also, money transfers between people who have a Monzo card are made so easy it is impressive. It also offers savings accounts via the “Pot” feature.
One shortcoming is that you will not get an IBAN number. This means that you cannot transfer money into your Monzo account from a bank account opened in another country than the UK. Not that you would need it though since your card can pay in any currency and any country. More details here.
Revolut is extremely similar to Monzo. The only differences are that it creates an account for you in several currencies, providing you with an IBAN number as well as a UK account number. It also gives you a virtual card for free with which you can pay online, but you will need to order a physical card for £5. There is no FSCS protection making it different to normal traditional bank accounts, though your Revolut account is a current account nonetheless. You also have the same friends feature, just like with Monzo, except for Revolut users. It offers savings accounts via “Vaults” accounts, allowing you to save a certain amount using some saving tricks such as rounding up your expenses (read our article on this). Revolut also enables investing in cryptocurrencies directly from the app. More details here.
Open an account on either of these and pay on holidays as if you had a local account. No fees, no need to let your bank know you are going away and you can manage everything from the app. When you make a payment with your card, you also get an instant notification on your phone. Welcome to the 21st century, where you do not let banks take your holiday money anymore.
Note: Revolut and Monzo are actual banks. This means you could close your accounts in your traditional bank and just have either of them as your main bank accounts.