Monzo is a new type of bank, offering customers services based around convenience and technological innovation. You won’t find any physical branches - instead Monzo customers can access their accounts, and 24 hour support, via an app.
If you have a Monzo current account - or if you’re considering getting one - you might want to know how you can make international payments. Maybe you need to pay back a friend who lives abroad, or you’re planning a holiday, and need to make a deposit payment to a hotel on the continent. This handy guide on Monzo international payments has you covered.
Monzo is a digital bank, based in the UK. Founded in 2015, Monzo’s success and new approach to banking services has led it to be described as a challenger bank.
Unlike traditional high street banks, Monzo doesn’t have any physical branches. Instead, you can operate your account, check your balance, make payments and access other financial services via the Monzo app¹.
You’re eligible to open a Monzo account if you’re over 16 years old, and a UK resident. Joint accounts are also available, and there are no monthly fees to pay for any Monzo account².
At the moment, receiving an international payment isn’t as reliable as Monzo would like it to be just yet, but they’re working on it. In the meantime, they recommend that you use an online IBAN generator to get your IBAN - the internationally recognized account number used to send money overseas.
You can give this IBAN to the sender, to process the payment. Monzo does say that the payment might take several days, or may not reach your account at all. The reason for it not being completely reliable is that Monzo is not yet connected to the SEPA or SWIFT network³.
However, thanks to the partnership between Wise and Monzo, you can still receive international payments to your Monzo account and bypass the SWIFT network.
With Wise, you can make a payment from your local bank account to Wise’s local bank account, after which they’ll convert the money with the real, mid-market exchange rate to GBP, and will then transfer it with a local transfer to your Monzo account in the UK.
So there will be no need to generate an IBAN or use the SWIFT network, you can just give your UK Monzo account number and sort code to make the payment.
You can send money to a friend or family member with a bank account overseas using Monzo. Although Monzo has partnered with Wise, so they’re able to offer international payments to their customers, you don’t have to leave the Monzo app to do this.
Simply choose the bank transfer option in the Monzo app, and then click on international transfer. You can then enter your recipient’s details, and send the money⁴.
If you haven’t made an international payment via the Monzo app before, your Monzo account will have to be connected to Wise with your first payment. If you already have a Wise profile, you can connect your Monzo account to that one. If you don’t have a Wise profile yet, you can create one via the Monzo app.
And the easiest part is that you don’t have to transfer the money to Wise. At the last step, you simply confirm your payment in the Monzo app, and after you’ve confirmed it, they automatically send the money to Wise as a Faster Payment, so it should arrive with Wise in a few minutes maximum.
Your international Monzo payment always has to be from GBP, but there are currently 35 currencies supported that you can send money to - here’s the full list:
Monzo have teamed up with Wise to offer great value, convenient international transfers. Like Monzo, Wise believes in transparency. That means there are no hidden costs when you make an international payment - and Monzo customers will pay exactly the same as they would if they made the transfer directly from the Wise website or app⁴.
Let’s say you’re sending pounds to euros - so making a payment from your Monzo account to a friend in France, for example, with a euro denominated account.
Transferring £500 will cost £2 in fees, while a £1,000 transfer comes in at £3.75. You essentially pay 0.26 GBP fixed fee, and 3.49 GBP (0.35%) variable fee. Independent research has shown that this can be on average up to 8x cheaper than sending money via a high street bank, so you end up with more to spend on yourself.
You’ll be able to see the costs for your transfer in the Monzo app, before you decide to go ahead - no surprises, and no sneaky fees.
When you make an international transfer with Monzo, it will be processed using the mid-market exchange rate. That’s the rate you’ll see if you google your currency pairing, and the one that banks use when they trade currencies between themselves.
Most banks and international transfer services don’t offer this exchange rate to their customers. Instead, they add a markup, which they then keep as profit for themselves. That means that it’s very hard to see the true cost of an international payment - and often you pay more than you have to.
International payments with Monzo come with a low, transparent fee, and always use the real, mid-market exchange rate, so you can see exactly what the transfer will cost you before you get started.
So there you have it - all you need, to get started making and receiving international payments with your Monzo account. Competitively priced services, with no hidden costs - so you know you’re getting a fair deal every time.
All sources checked on October 8, 2020
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