Fintech Tips: Best digital bank for travel money

By Roger Baird on 15th April 2019

Challenger Banks

AltFi looks at the bespoke services and the rates charged for holidaymakers by digital banks.

Fintech Tips: Best digital bank for travel money

Millions of holidaymakers are planning summer getaways in hotspots they hope will allow them to forget Brexit for a fortnight.

Since Britain’s June 2016 referendum decision to leave the European Union, the pound is down more than 13.5 per cent against the dollar at around $1.31 and just under nine per cent lower against the euro at around 1.16. So, any savings travellers make abroad will boost their spending power.    

Choosing the right bank to handle your travel arrangements, avoids a nasty surprise when you open your credit card bill back at home.

Below are some of the best travel money deals from digital banks.

The Winner: Starling Bank

Starling offers a comprehensive travel money service.

There are no limits on cash withdrawals from your account, and no fees, although local ATM providers may levy a charge.

It uses the Mastercard exchange rate, which tend to be slightly better for consumer’s than wholesale rates set by rivals Visa and American Express, according to MoneySavingExpert.

Starling does not add fees on top of the Mastercard rate.

The account from the bank, founded in 2017, has a number of other nifty features.

Instant app notifications on spending in both pounds and foreign currency are sent to your mobile phone and overdrafts can be applied for while on holiday.

If you think you have lost your card you can lock it from your mobile, and unlock it if it turns up the next day hidden away under an old pair of trunks.

Read our full review: Starling Bank - April 2019

The Runners-up:

B

The digital banking app does not charge an additional foreign exchange fee for taking cash out while abroad, but it does levy a 3 per cent charge, with a £3 minimum, for withdrawing cash on its credit card.  

The service, launched by Clydesdale and Yorkshire Banks in 2016, uses Mastercard exchange rates.

The app comes with a free currency converter, so you can compare whether the pumps you saw in Paris are cheaper than the same pair you saw in Porthcawl.

Loot

The digital current account app has a limit of £250 a day on cash withdrawals with the first two each month coming free, after that each withdrawal costs £1. The firm, founded in 2014, uses the Mastercard exchange rate.

The app allows users to pause and unpause misplaced cards. However, the mag stripe transactions are turned off on Loot cards, even though ATMs in some countries only accept cards by swiping the mag stripe. The business “recommends taking an extra card with you whilst travelling”.

The Rest:

Revolut

The digital bank might have 4.5 million customers across Europe - with 1.6 million users in the UK alone - but its travel service does not reflect that scale. The lender, founded in 2015, allows customers to withdraw £200 a month from ATMs for free, after that it charges a 2 per cent fee. It does not use Mastercard exchange rates.

The bank provides foreign exchange at interbank exchange rates without any additional fees on most currencies during the week, but charges between 0.5 per cent and 1 per cent on all currencies at the weekend.

Monzo

The challenger bank allows customers to withdraw up to £200 a month for free, after which it charge a 3 per cent fee. The lender, which has amassed 1.5 million customers since its launch in 2015, does use Mastercard exchange rates.

Monese

Digital service Monese standard free account charges a fee of either £1, or €1, for whole-in-the-wall cash withdrawals. It levies a 2 per cent fee on currency transactions, which use Mastercard exchange rates.

Monese, founded in 2013, has over 800,000 customers signed up across 30 countries.

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Companies in this Article:

Loot
Monese
Monzo
Starling Bank