If you’re reading this, you’re interested in finding a new card to use when travelling abroad. Specifically, a card that doesn’t charge you high, or even worse, hidden fees when spending on your trip.
So we’ve compared Monzo’s Terms and Conditions for spending abroad with our own, to help you make the right decision.
What is Monzo?
Monzo, founded in 2015, is an app-based mobile bank. It provides you with a debit card and works just like a standard current account, with the key difference being that it’s all digital.
What card options and plans does Monzo offer?
Monzo has several options including Monzo Plus and Monzo Premium, but for the purposes of this comparison we’ll be focusing on the card that comes with their free to use Personal Current Account.
Card scheme vs interbank foreign exchange rates
The card scheme foreign exchange rate is set each day by major credit card networks such as Visa and Mastercard.
While the value of currencies fluctuates throughout the day, the card scheme rate stays the same for the whole day. The rate will contain a mark-up to protect the card schemes from fluctuation risks. It’s difficult to figure out exactly how this rate is calculated as the information isn't shared, but this is the rate that Monzo uses.
The interbank rate, on the other hand, tracks the real-time value of currencies and is considered the fairest rate in the industry. It fluctuates throughout the day, and is the rate that Currensea uses, with an additional 0.5% markup.
So what does Monzo charge you to spend abroad?
We don’t believe fees should ever be hidden - so we’ve done the calculations for you.
Using data from January to March 2023, we were able to calculate the average markup over the interbank rate applied to the card scheme rates. We did this by comparing those rates with the average highs and lows of the daily interbank rate, using a selection of the most popular travel currencies. On average, the markup built into the card scheme rate was 0.54% for Mastercard and 0.6% for Visa- since Monzo uses Mastercard, this means that you're typically being charged 0.54% above the interbank rate when you use their card to spend abroad.
What other fees does Monzo charge?
Cash Withdrawals
While Monzo advertise free unlimited cash withdrawals within the UK and Europe, this benefit is only available if Monzo is your main bank account.
This means you must have:
- Paid at least £500 into your Monzo account over the last rolling 35-day period
- Have an active Direct Debit on the same account in the same period
- Received a Department for Work and Pensions or a Department for Communities payment into a Monzo account in your name over the last rolling 35-day period
- Received a student loan payment in your name over the last rolling 8-month period
- Share a Monzo Joint Account with someone who has done at least one of the above
Go outside of Europe and there is a cash withdrawal limit of £200 per month. Exceed this and you'll be charged 3% per withdrawal and you may also have to pay additional ATM charges on some machines.
If Monzo is your secondary bank account, the fees are higher. Within the EEA, you'll be charged 3% per withdrawal if you exceed £400 in a rolling 30-day period, and outside the EEA you'll be charged this if you exceed just £200.
Replacement cards
In the UK, no fee is charged for replacing stolen, frauded and expired cards, but a replacement card fee of £5 is charged in any other circumstances. However, if you need a replacement while abroad, Monzo will charge you £30 per card no matter the circumstances!
What is Currensea?
Currensea is a travel debit card that allows you to spend money directly from your trusted bank account, rather than having to open up a new one or top up a prepaid card. It is based on open banking, which was introduced several years ago to promote innovation and competition in financial services so that you have access to a wider range of options and rates.
What card options does Currensea offer?
Currensea has three travel cards, including Currensea Premium and Currensea Elite. For the purposes of this comparison, we'll be focusing on Currensea Essential, which is free like the Monzo personal current account.
So what is different about Currensea?
Not only do we offer realtime (and marginally better!) rates, but unlike Monzo users you won’t need to faff around opening a new bank account to get a card.
What Currensea offers is a card that partners directly with your trusted bank account. That means you can spend with your Currensea card abroad just as you would at home with your regular debit card. Funds come straight out of your bank account, and you can spend whatever balance you have.
Because it’s not a prepaid card (like some travel cards), you never have to top up your Currensea card. You don’t have to worry about losing it and any funds that might remain on it, nor do you have to constantly top it up and remember how much you have on it: we offer travel, but without the hassle.
We also check how much your bank would have charged you to use your regular debit card abroad- and we can tell you exactly how much money you saved by using your Currensea card.
What does Currensea charge to spend abroad?
We convert your currency based on the real-time interbank exchange rate, with an additional markup of 0.5% per transaction no matter when you use it or how much you spend with it. No hidden fees, no weekend fees, no increases to the markup - just clear, transparent information on how much we charge and how much you save.
What other fees does Currensea charge?
Cash withdrawal
We charge our usual fee of 0.5% for withdrawals up to £500 a month, and for anything over this amount we charge 2%.
Replacement cards
While your first card is free, we charge a £5 replacement fee (but no delivery fees).
How does Currensea stack up against Monzo?
We compared how much it would cost spending with Currensea versus Monzo on a 10 day holiday to Florida for a family of four. With a combination of card and cash spending, we found that using a Currensea card can save you just shy of £12 on FX fees compared to Monzo.
Take a look at the table to see the breakdown of spend- we've also included the card scheme rate that Monzo charges.
| |
Our charges |
Monzo charges |
| $10,000 card spend |
£39.06 |
£0 |
| $600 on ATM withdrawals |
£2.34 |
£8.06 |
| Card scheme rate |
£0 |
£44.72 |
| TOTAL |
£41.40 |
£52.78 |
Total saved with Currensea vs using Monzo: £11.38
% saved with Currensea vs using Monzo: 21.55%
In summary
Monzo and Currensea are fairly similar when it comes to FX charges. Both products offer competitive rates that significantly undercut those offered by high street banks, and whichever product you choose there is no doubt that you'll save a significant amount when spending abroad. If you are looking for a new bank account that will cost you less than high street banks when spending abroad, Monzo could be a good choice. But be careful – you will have to ensure you are using Monzo as your primary bank account to access the full benefits.
However, if you have no plans to leave your high street bank, Currensea is the easier option for you. While Currensea simply partners with your existing bank account, Monzo requires you to create an entirely new bank account. Assuming this is used as a secondary account, you'll then need to faff around topping it up as you spend abroad. With Currensea on the other hand, you can spend abroad just as you would at home with your regular debit card- we do travel, but without the hassle.
Even if you leave your high street bank and operate with Monzo as your primary bank account, rates are still a consideration. Although Monzo uses the Mastercard card scheme rate, this includes a 0.54% markup on average over the interbank rate. We offer the real-time interbank rate with a markup of just 0.5%, meaning that typically our rates are slightly lower. It's pretty marginal though, so we would never advocate basing a decision on that alone.
Overall, if you are in the market for a new primary bank account, Monzo is a great option with good rates. But if you are happy with your existing bank account and want a product focused on great rates when travelling abroad, then Currensea is the right choice for you.
