Monzo vs Wise
Monzo Key Features
- Fast transfers
Wise Key Features
- Offers low rates
- Well known brand
The main difference between Monzo and Wise is that Monzo adds an average exchange rate spread of 0.05 – 0.5% to most foreign currency transfers while Wise does not add any kind of markup to the price.
In this comparison we will be considering the similarities and differences between two of the UK’s leading online financial service providers, Monzo and Wise, formerly Transferwise. By evaluating the overall cost, global coverage and customer feedback of both brands, we will be able to gain insight into which one offers the best options for customers making international money transfers.
At a Glance
- About Monzo and Wise
- Which brand has lower fees?
- Which brand offers better exchange rates?
- Which brand covers more locations?
- Which is faster?
- Which brand offers more transfer & payment options?
- What do users have to say about each brand?
- What brand offers better ease of use, accessibility, transparency & security?
- Additional features
About Monzo and Wise
Both Monzo and Wise are UK-based financial services dedicated to breaking the mould in their respective fields, by providing innovative solutions for consumers around the world.
Founded in 2015, Monzo is an app-based challenger bank which operates entirely online and is designed to be quicker and more convenient than traditional banking. Over the last six years, Monzo has been constantly developing their offerings, keeping up with the fast-paced evolution of the FinTech industry. As a result, the company has expanded into an FCA approved bank that boasts a wide range of UK accounts as well as loans and overdrafts.
Wise, formerly known as Transferwise, was set up in 2011 to cater to customers who were tired of being charged high fees and unfavourable exchange rates whenever they sent money overseas. To solve this problem, founders Kristo Käärmann and Taavet Hinrikus decided to start their own business that would offer fast and fair cross-border money transfers to rival the extortionate cost of a traditional international bank transfer.
The company manages to stay ahead of the curve through their mid-market rates and guaranteed transparency of currency conversions and transfer fees. With bank accounts across the globe, Wise specialises in moving money seamlessly between international users, offering excellent rates for exotic currencies and serving over 10 million customers.
In 2018, Monzo teamed up with Wise to provide low-cost, easy to use international money transfers to their customers. We want to find out not only which brand is benefiting most from this partnership, but also who our customers should be trusting to transfer their hard-earned money abroad.
Which brand has lower fees?
Monzo international money transfers are handled by Wise, who base fees on the type of transfer chosen by the customer. The transfer options include a low cost, advanced or fast transfer.
Generally speaking, transfer fees do not amount to more than 0.35 – 0.65% of the transfer.
For money transfers up to £500 or equivalent, Wise fees are reasonably low. However, keep in mind the higher the transfer amount, the higher the fees.
It is possible to review the transfer fees in full, using the Monzo app, before initiating payment.
Wise stays true to its word, by providing customers as close to the mid-market rate as possible, but this means the company relies on transfer fees to turn a profit.
These fees vary depending on the currency pairing.
Additionally charges include debit and credit card fees; these can range from 0.15% – 2% on top of the transfer amount.
Wise has a useful pricing tool which allows customers to calculate the transfer fees, ensuring total transparency, before initiating payment.
Monzo global money transfers are provided by Wise, so the same fee structure is applied to both. In that sense, Wise is our pick of the two.
Which brand offers better exchange rates?
When spending money abroad with your Monzo card, the bank applies the Mastercard® exchange rate to all payments.
However, when arranging international money transfers, Monzo customers can take advantage of Wise exchange rates. This means, in most cases, customers will be offered an exchange rate that is near-identical to the mid-market rate.
Our research indicates an average exchange rate spread of 0.05 – 0.5% is added to most foreign currency transfers.
Wise consistently remains at the top of the leaderboard in the race to offer customers the most competitive exchange rates. For all standard currencies, Wise does not appear to add any kind of markup to the price, which means customers can benefit from the exact mid-market rate that banks use when trading currencies.
Wise also allows customers to lock in a rate for up to 96 hours to avoid currency fluctuations.
Wise has to be the winner of this category because foreign exchange is the company’s main line of focus, whereas Monzo is unable to guarantee the mid-market rate in all areas relating to global payments.
Which brand covers more locations?
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.
Wise customers are able to send and receive over 50 currencies, send to 60 countries and request money from over 30.
Find the full list of countries supported by Wise here.
Monzo international money transfers are powered by Wise and as an authority in the foreign currency market, Wise is generally better equipped for facilitating cross-border transactions to a bigger variety of countries.
Which is faster?
Domestic transfers sent from one Monzo account holder to another are instant. International transfers can take up to 3 working days to arrive with the recipient.
Moving money between Wise accounts based in the same country can be processed instantly by either party.
International money transfers sent from a bank account in one country to an account holder in another country are processed in three stages: receiving, converting and delivering. The average time for this process to be complete is 3 business days.
Quicker transfer speed is available to those using a debit or credit card as payment, albeit with a higher fees attached.
Customers will receive the same transfer speed whether sending money with Wise or Monzo.
Which brand offers more transfer & payment options?
Wise handles international money transfers on behalf of Monzo and the transfer options available are as follows:
Fast and easy transfer: the quickest way to send money overseas, paid for using debit or credit card, or a digital wallet like Google Pay. Albeit fast, this option is the most expensive.
Low-cost transfer: this cost-effective option and is ideal for customers prioritising price over speed. This type takes the longest, due to payment via bank transfer.
Advanced transfer: this type of international money transfer utilises the SWIFT network, which typically incurs a fee.
The payment options available with Wise are:
ACH direct debit
The same transfer and payment options are applicable.
Monzo international money transfers are powered by Wise, meaning both brands offer the same transfer options and payment methods.
What do users have to say about each brand?
As a challenger bank that is exclusively accessible via mobile or smart device, a great way to gauge customer satisfaction is by evaluating reviews of the Monzo app.
Over 60,000 Android users have rated the app 4.7 out of 5 stars, while iOS users have given the app 4.9 out of 5. This suggests the app is well designed and considered reliable by all who use it.
Over on Trustpilot Monzo has been awarded 4.5 out of 5 stars by more than 17,000 users.
Positive feedback accounts for 86% of the reviews, many of which reference the easy to use mobile interface, quick cross-border payments, helpful real-time notifications and spending insights.
Around 12% of the reviews are categorised as Bad or Poor and they include comments about account freezes and closures, blocked funds and unsatisfactory customer service.
The Wise platform is available via mobile app or website, enhancing the accessibility of their services. The app has been given a 4.8 out of 5 by iOS users and 4.5 out of 5 by Android customers.
On Trustpilot Wise has been given 4.6 out of 5 which is an Excellent rating.
Positive customer reviews highlight the transparent fee structure, unmatched exchange rates, and trusted transfer process.
Negative comments reference disappointment with recent price increases for certain currencies, unexplained deactivation or blocking and holding funds.
Elsewhere, Wise regularly knocks competitors off of the top spot and has been awarded a number of highly coveted titles by the money transfers community.
Monzo is a popular challenger bank with a good online presence but Wise wins the gold for their overall reputation and standing within the industry.
What brand offers better ease of use, accessibility, transparency & security?
Accessibility: Only customers with a residential address in the UK can access Monzo services, and it is also only accessible in the English language.
Transparency: Monzo customers can benefit from the guaranteed transparency of Wise terms of service, with support accessible via in-app messaging, email or phone
Security: Monzo is covered by the Financial Services Compensation Scheme (FSCS) which means customers’ funds are protected (up to £85,000). In addition to this bank-level insurance, sophisticated data encryption and two-factor authentication is used to further protect customer details.
Ease of use: User consensus is that Monzo is quick and easy to sign up for, learn how to use and manage finances with. The clearly displayed categories make it easy to create tailor made budgets and savings pots, review spending habits and set up domestic or international money transfers.
Accessibility: Wise services are available in over 60 countries and accessible in the following 15 languages: English (US and UK), Deutsch, French, Spanish, Italian, Indonesian, Portuguese, Hungarian, Polish, Romanian, Russian, Japanese, Chinese and Turkish.
Transparency: Wise has a reputation for guaranteeing total transparency, clearly displaying fees and other charges throughout the entire transfer process, as well as letting customers lock in an exchange rate for up to 96 hours.
Security: Registered as an e-money institution, Wise is not covered by the FSCS but the company is covered by the FCA. Wise is a long-standing, secure business to use for money transfers but we do not recommend the company for use as a primary bank account.
Ease of use: Wise has had over 10 years to streamline and optimise the user experience of their website, and it is now considered one of the best of its kind. Online reviews suggest the Wise website is more popular than the mobile app.
Although Wise is unable to meet the same bank-level standards of security as Monzo, it exceeds expectations in all other areas and continues to evolve into an all-encompassing financial services brand.
Customers that switch energy suppliers through Monzo will be rewarded £50 credit
Saving is easy with Monzo Saving Pots; plus zero interest rates on free savings accounts (up to 1.5% AER on paid accounts)
Joint accounts are available for couples and junior accounts for 16 – 17 year olds
Wise offers a Borderless multi-currency bank account which is popular with globetrotting customers: it comes with a free Mastercard prepaid card and is compatible with Apple and Google Pay and can be used in 200 countries
Challenger banks are, by definition, known for staying ahead of the curve and Monzo is no different. The digital bank is constantly rolling out new incentives and cutting-edge features to encourage customers to leave traditional banking for pastures new.
In this comparison Wise has excelled in almost every category and has to be given the gold. The tech savvy founders of Wise have kept their finger on the pulse of cross-border money transfers for the past decade and continue to exceed expectations when it comes to global coverage, transparent fees and competitive exchange rates.
Add to this the fact the company has launched their own product line of multi-currency accounts, while also teaming up with other challenger banks like Monzo, and it is clear Wise is becoming an all-in-one service for customers around the globe. Find out more about the company in our full review of Wise international money transfers. Still not convinced? Use our comparison tool to see which service provider comes out on top when moving money around.