Online banking has expanded over the past few years. The demand for online banks has increased as people look for more innovative and convenient banking methods.
In response, the banks have continuously added features to capitalise on the growing market and attract more users. While this is a good thing, it makes it harder for average users to determine the best option for them with so much diversity.
Wise and Monzo are among the most notable online banks in the UK. Like other competitors, they have expanded their features and benefits. Choosing the right one requires comparing different aspects of their model to find the best one, depending on your needs.
Wise Vs Monzo: About
Wise and Monzo are UK-based financial services. They provide innovative banking and money-sending solutions to private customers and businesses in their respective fields.
Monzo is an app-based challenger bank founded in 2015. It operates entirely online, promising to deliver a quicker and more convenient range of financial solutions than traditional banking. Since its establishment, Monzo has constantly developed its offerings and has kept up with the fast-paced nature of the FinTech industry. The company has now expanded into an FCA-approved bank boasting a wide range of UK accounts and offering additional services, including overdrafts and loans.
Wise has been around longer. It was founded in 2011 to cater to customers looking for a more affordable way to send money overseas. Wise achieved this by offering better money-sending and favourable exchange rates. The founders of Wise envisioned a start-up that would offer faster and fair cross-border money transfers to rival the exploitative costs of traditional international money transfers.
Wise has always stayed ahead of the competition through its mid-market rates and guaranteed transparency of currency conversions and transfer fees.
Wise has bank accounts across the glove. Using them, it specialises in moving money seamlessly between international users. It also offers excellent rates for exotic currencies and serves over 10 million customers globally.
When looking at both companies, you’re more interested in their differences. However, in 2018 Monzo and Wise teamed up to provide low-cost, easy-to-use international money transfers to their customers. Still, you have to find out which brand you can benefit from most when sending your hard-earned money abroad.
Wise Vs Monzo: Account Features
Both companies offer more or less the same services but have different account features, which is a great place to start looking into when considering the differences between the two FinTech companies.
Monzo account features
Monzo offers a free-to-open full-service current account. The account can hold money in GBP, and you can set up direct debits to pay bills and utilities.
With Monzo, customers can also create savings pots and earn interest on their savings. You can use your unique Monzo account number with your employer to get your salary credited into your account.
Other vital features on the Monzo account include easy budgeting and splitting features, joint accounts, multiple ways to fund your account, including bank transfer, cheque deposit and cash deposits at PayPoint, and pre-approved overdraft features and loans.
You can also open a dedicated business account and manage your business finances using multi-user access and integration with key business apps.
Wise account features
A wise account is also free to open and hold. With Wise, you can manage and transfer over 40 currencies with Wise and Wise borderless multi-currency accounts.
You can get international bank details with Wise Borderless in various major currencies, including USD, GBP, AUD, CAD, and NZD.
Using Wise, you can send money directly to your recipient’s bank account and get paid like a local. It’s also possible to transfer money locally with a borderless account.
You can find your Wise account in the same ways you fund a Monzo account and even open a dedicated business account with features like invoice generation and integration with business apps.
Wise has some features that Monzo doesn’t like holding multiple currencies, and the same is also true for Monzo with its pre-approved loans and overdrafts. Something that Wise doesn’t offer. You must carefully consider these differences and choose the company that best suits your needs.
Wise Vs Monzo: Cards and Fees
Although opening an account with either company is free, operating the account attracts various fees.
Monzo has a debit Mastercard that is accepted globally. You incur zero foreign exchange fees with the card when travelling abroad. You also get free ATM withdrawals in the European Economic Zone with no upper limit and up to £200 per month when travelling abroad. There’s a 3% fee applicable over the limit. Also, some ATMs may charge a convenience fee.
When you apply for the Monzo card, there’s no card delivery fee, but you will need to pay a £30 replacement fee if you lose the card abroad.
You can integrate your account and the card with Gpay and Apple Pay for contactless payments. You can also freeze and unfreeze the card from the app. Although you can use the card globally, it is only available in the UK.
Wise also issues a globally accepted MasterCard. The fee structure for Wise is slightly more complicated than Monzo’s and is often based on percentages. Foreign exchange fees are also applicable on payments while travelling abroad that range from 0.35% to 2.85%, depending on the currency.
Here’s a quick breakdown of the Wise fees and costs for foreign exchange fees applicable on payment while travelling abroad;
- from EUR to USD 0.41%
- from USD to GBP 0.45%
- from USD to EUR 0.45%
- from AUD to USD 0.47%
Depending on the transaction in question, you will also incur additional fees with Wise. These include;
- Free ATM withdrawals up to £200 per month; a 2% fee is applicable over the limit
- Integrates with Gpay and ApplePay for contactless payments
- Freeze and unfreeze card from the app
- No card delivery fee or renewal fees
- Available in the UK, US, Canada, Europe, Australia, and NewZealand
Both cards are quite similar in how they operate and what they offer. If you’re in the UK, Monzo is better, while the Wise card is ideal for travellers, although it can get expensive with the foreign exchange fee.
Wise Vs Monzo: Money Transfer and Exchange rates
When using Monzo and Wise, you will most likely be sending money within the UK or internationally. Both services have excellent money transfer features and exchange rates.
With Monzo, there are five ways to transfer money. You can make Monzo to Monzo payments to anyone in the UK instant and free. You can also send money to anyone via email, text, or social media. You don’t need their banking details. Once you send the money, the recipient will get a like to sign up for Monzo to claim their funds.
You can also use the “Nearby Friends” feature on the Monzo app to send money by Bluetooth. Alternatively, you can initiate a regular bank transfer from your payments screen in the app. This is only possible with UK bank accounts only. In some cases, the receiving bank may charge a convenience fee.
Finally, Monzo has partnered with Wise to facilitate international transfers. Monzo supports transfers from GBP to 35 currencies. When sending money internationally with Monzo, expect a £0.5 to £3.0 fee, including Wise’s percentage fee on the interbank change rate.
There’s a £10,000 limit when transferring money with Monzo, and you can’t receive international payments with Monzo.
Wise has a more robust money transfer system that is also favoured because of its low, transparent fee structure.
When using Wise, you can fund your transfer with a credit or debit card or location-specific methods like Sofort or iDEAL.
Wise will charge you a percentage over the interbank exchange rate which is extremely competitive compared to its peers and high street banks who charge 3-5% of each transfer.
Wise has a handy currency convertor widget on their website that you can use to calculate the exact fees you’ll pay before sending money.
Another benefit of Wise is that it has bank details in all the areas it services. There are no unexpected deductions for you or your recipient. Wise allows you to send and receive money locally and internationally in over 40 currencies worldwide.
The only downside with Wise is that you can only send money to another bank account. However, it is convenient because the recipient can access the funds once the transfer is complete.
Wise offers an amazing range of money transfer solutions. Although Monzo has some exciting technology, you can’t receive money internationally. Wise is more flexible, offering multiple currency accounts and competitive exchange rates.
Wise Vs Monzo: Locations/Presence
For customers in the UK, the location might not be much of an issue. But location becomes a matter of concern when sending and receiving money internationally.
Monzo is only available to customers in the UK, but it is possible to send money to 34 countries through the mobile app.
Monzo is covered by the SEPA zone making Euro transfers the easiest and most popular international transfer on Monzo.
Wise customers can send and receive money in over 50 currencies, send money to 60 countries from the UK and request money from over 30 countries. It’s safe to say Wise has more of a global presence. So much so that Monzo has partnered with Wise to facilitate international transfers.
Wise is generally better equipped for facilitating cross-border transactions to a wider variety of countries.
Wise Vs Monzo: Transaction Speed
With the world becoming a global village thanks to the IoT, communication has become easier, and it is also easier and faster to send money across the world. Of course, how fast you send the money depends on the service you use.
Domestic transfers from one Monzo account holder to another are instant. However, international transfers can take up to 3 working days to get to the recipient because of Monzo’s limited international coverage.
Moving money between Wise accounts based in the same country can be processed instantly by either party.
International transfers sent from a bank account in one country to an account holder in another country are processed in three stages. The first is Wise receiving the money from the sender account, converting the money into the recipient’s local currency and finally delivering. The average time to process the transfer can be 3 business days, but there are cases where the process has taken a shorter time.
Debit and credit card users have a faster transfer speed, but the fees attached to this transfer process are higher.
It seems both services have the same transfer speeds in money transfer. Even though Wise has a more elaborate international transfer process, it gets money to the recipient within the same time as Monzo.
Wise Vs Monzo: Transfer and Payment Options
Wise and Monzo have various transfer and payment options available. However, it is worth noting that Wise handles international money transfers on behalf of Monzo. Therefore, the modes of sending money and payments between the two companies are identical.
Fast and easy transfer
This is the quickest way to send money overseas on Monzo and Wise. The sender loads money using their debit or credit or a digital wallet like Google Pay. Although this method is the fastest and the easiest to send money, it is the most expensive.
Customers looking for a more cost-effective method of sending money in lieu of speed can consider this method. It takes the longest time because the payment is via bank transfer, but the cost associated with it are minimal.
This is a type of international money transfer that uses the SWIFT network. The sender incurs a fee to send money using this method, but it has benefits, especially if you intend to send regular amounts of money to the same recipients.
When using Wise and Monzo for payments, you have four options available. These are;
- Credit card
- Debit card
- Bank transfer
- ACH direct debit
Once more, both brands have a tie because whether you use Monzo or Wise for international payments and money transfers, you have the same options, and the experience is pretty much the same across the different options.
Wise Vs Monzo: Ease of Use, Accessibility, Security and Transparency
Online banks have a precarious balance to maintain between ease of operation, safety and speed. Luckily, both Monzo and Wise have managed to strike a balance between the three aspects.
Monzo is a registered bank in the UK. That’s to say, your money is safeguarded by the same security and regulatory protocols used by traditional high street banks. Monzo is also insured by the Financial Services Compensation Scheme (FCS), which means if it shuts down, you have guaranteed fund protection of up to £85,000.
Monzo also uses various safety and security features for its transactions. These include verifying all purchases in the app and via text and double-checking that the payments have been authorised by you.
Monzo customers benefit directly from the transparency of Wise terms of service. Users can access support via the app, messaging, email or phone. Like Wise customers, they can use the currency converter to know how much their recipient will receive.
Only customers with a residential address in the UK can access Monzo services. Monzo is accessible in English, expanding the range of customers that can use the app and the service.
Ease of use
Many users say that Monzo is quick and easy to sign up for, use and manage finances with. The clearly displayed categories make it easy to create tailor-made budgets and saving pots, review spending habits and set up domestic or international money transfers.
Wise is also a registered and regulated financial services provider in all the countries it services. It is regulated by the FCA in the UK, the Australian Securities and Investments Commission (ASIC) in Australia, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) in Canada and so forth.
Wise also undertakes the verification of all user accounts and audits transfers to prevent theft, fraud and money laundering. Also, it has an industry-leading encryption protocol to ensure your account and transfers are completely secure.
However, because Wise is not a bank, funds held in the accounts are not protected under the government guarantee. That’s why we recommend transferring funds to your multi-currency wallet shortly before initiating the transfer so you can lock in the exchange rate.
Wise has built a reputation for total transparency. It clearly displays fees and other charges associated with the transfer of money during the entire process and even lets customers lock in an exchange rate for up to 96 hours.
Wise is highly accessible. It has services available in over 60 countries and is accessible in multiple languages, including English, Deutsch, French, Italian, Indonesian, Portuguese, Chinese, Turkish, Polish, Japanese, Russian and Hungarian, among others.
Ease of use
Wise has had over a decade to streamline and optimise the user experience of its website. It is now considered one of the best in its industry. Online reviews indicate that the Wise website is more popular than the mobile app.
Both companies are registered by leading financial regulators and are compliant. They’ve also deployed the latest safety and security features to provide their users with a safe platform to transfer and receive money.
Wise Vs Monzo: Additional Features
Besides the standard features, both Monzo and Wise have additional features that could help you choose between them.
Monzo customers that switch energy suppliers through the app are rewarded a £50 credit. Also, saving is made easier with the Monzo Saving Pots. You also get zero interest rates on free savings accounts and up to 1.5% AER on paid accounts.
Under Monzo, you can also open joint accounts. These are available for couples. There are also junior accounts for 16-17 years old.
The Wise Borderless multi-currency bank account is their most significant additional feature. The account is popular with globetrotting customers, which allows them to carry different currencies to the countries they visit.
The account comes with a free Mastercard prepaid card and is compatible with Apple and Google Pay. The card can be used in close to 200 countries.
Monzo has stayed true to the mission of most challenger banks, to stay ahead of the pack. Monzo is constantly rolling out new incentives and cutting-edge features to encourage customers to leave traditional banking for better pastures.
Wise Vs Monzo: Customer Reviews and Customer Support
Customer reviews are the best way to measure a company’s support. Monzo and Wise have served enough customers and have received enough feedback to paint a good picture of what they have to offer.
Customer reviews Monzo
Monzo is rated 4.5 out of 5 and has received over 19,000 reviews. 80% of Monzo users have rated the service provider as excellent, while 8% have had a good or average experience.
Most people highlight how easy it is to use the app, as well as the quick sign-up process and the rapid Monzo to Monzo transfers.
However, 12% of the users have shared having a bad experience with the service. Most have cited difficulties opening the account, issues using the credited card, and unexpected account freezes.
Customer reviews Wise
Wise has a higher positive rating on Trustpilot at 4.6 out of 5, with over 135,000 reviews. 85% of reviewers have had an excellent experience with Wise, while 9% have had a good or average experience. 6% have had a bad experience with the service.
The top causes of dissatisfaction include transfer delays and unexpected account suspension.
Customer support Monzo
Both Monzo and Wise have a vibrant customer support team that can be reached via various platforms.
Monzo has a vibrant Q&A forum and a fairly comprehensive help section on their website. Existing Monzo users can reach out to Monzo customer service via the chat option in the app.
Getting a hold of the customer service team on Monzo can be challenging because they don’t list the number on their website. However, this problem is not with Monzo only. Most challenger banks also don’t list a customer support number. That’s because most of their operations are fully digital. They try to keep costs low by working with remote customer service teams.
Customer support Wise
Like Monzo, Wise also has a thriving Q&A section where you can get answers to the most common questions. If you don’t get assistance on that platform, you can reach Wise customer support via phone, live chat or email.
Wise also has a reputation for rising to the occasion and helping its users efficiently and swiftly in emergencies.
Wise serves a larger customer base but still finds ways to be more responsive to its customers by publishing useful, comprehensive online guides and ensuring its customer support team is easy to reach.
Wise would be the clear winner if you had to choose between the two. But from this comparison, you can see that it doesn’t excel in all the categories. Instead of simply choosing a winner, you should consider your needs, compare the features and benefits each challenger bank offers, and choose the one that best suits your needs.