Customers turn their backs on Monzo and Revolut as fears mount over profitability

SlovakianGuy

penners324 said:

The issue with Monzo closing accounts is they open accounts far too easily and a lot of their customers are young and naive.
Pretty obvious most people moaning about having their account shut down have been used as money mules so have brought it on themselves.

Agree.

I recently moved 10k to my Monzo and later to my Starling in one payment. No problem at all.

I move money around my 12 current accounts often and never had frozen any account.

Maybe TSB... a couple years ago, I sent 3k to my friend (just added her as a new payee). I was locked out of my account but as soon as I called TSB and explained that I lent money to my friend, it was unblocked straight away. The other case was just the transaction blocked, not the whole account. It was when I sent larger amount from my newly opened Halifax to my other current account. Again, I had to call them and explain it was not a fraud, just my own money to my other account. It was then unblocked immediately.

I wonder what all those people are doing with their account that they get frozen for weeks or months...

older_wiser

i don't really use revolut as a bank other than the odd overseas purchase what i do have is shares held on the platform is that money different to deposits ? i'm wondering whether it would be better to cash in the shares and the buy them on a different platform which i use regularly which now is freetrade. 

garmeg

penners324 said:

The issue with Monzo closing accounts is they open accounts far too easily and a lot of their customers are young and naive.
Pretty obvious most people moaning about having their account shut down have been used as money mules so have brought it on themselves.

I would have agreed with this, but the number of people in the group is large and there probably more not on facebook. It seems like a large number of mules. In that case it is very worrying.

There is a similar group for NatWest with 2,000 members.

Thrugelmir

The way to make current account banking profitable is to charge a monthly account fee. Digital banks have an uphill struggle to become sufficiently profitable to organically grow. 

[Deleted User]

Thrugelmir said:

The way to make current account banking profitable is to charge a monthly account fee. Digital banks have an uphill struggle to become sufficiently profitable to organically grow. 

The easiest way is to run the challenger brand via an legacy bank (like First Direct) then you can mop up most of the market via either of the brands. 

SlovakianGuy

dahj said:

The easiest way is to run the challenger brand via an legacy bank (like First Direct) then you can mop up most of the market via either of the brands. 

It didn't go very well for NatWest with their Bo   Although it wasn't a full-blown current account AFAIK, but not sure if that was the reason why it failed.

SlovakianGuy

older_wiser said:

i don't really use revolut as a bank other than the odd overseas purchase what i do have is shares held on the platform is that money different to deposits ? i'm wondering whether it would be better to cash in the shares and the buy them on a different platform which i use regularly which now is freetrade. 

Don't you need to pay tax on capital gains if you hold shares for less than 12 months?  If you cash in, this would trigger the tax, I guess.

[Deleted User]

SlovakianGuy said:

dahj said:

The easiest way is to run the challenger brand via an legacy bank (like First Direct) then you can mop up most of the market via either of the brands. 

It didn't go very well for NatWest with their Bo   Although it wasn't a full-blown current account AFAIK, but not sure if that was the reason why it failed.

Neither Monzo or Starling are currently profitable and of questionable long term sustainability.
RBS obviously didn't feel the need to burn through the cash with Bó

Thrugelmir

dahj said:

Thrugelmir said:

The way to make current account banking profitable is to charge a monthly account fee. Digital banks have an uphill struggle to become sufficiently profitable to organically grow. 

The easiest way is to run the challenger brand via an legacy bank (like First Direct) then you can mop up most of the market via either of the brands. 

First Direct is old tech. Launched as telephone banking originally.  When the price is right the fintechs will start selling out. 

older_wiser

SlovakianGuy said:

older_wiser said:

i don't really use revolut as a bank other than the odd overseas purchase what i do have is shares held on the platform is that money different to deposits ? i'm wondering whether it would be better to cash in the shares and the buy them on a different platform which i use regularly which now is freetrade. 

Don't you need to pay tax on capital gains if you hold shares for less than 12 months?  If you cash in, this would trigger the tax, I guess.

it would be far less than the 12k captial gains tax so that shouldn't be a problem the more worrying thing is what happens to my shares if revolut do get into financial problems.

They were my first platform for buying shares since then i've moved into HL for my S&S isa and freetrade as my indivudal share buying platform.