The announcement is likely to disappoint customers and could be the first of many. – an article written by Charlie Weston
DIGITAL bank Revolut is increasing its charges, just weeks after saying it had signed up one million customers in Ireland. The move has prompted some to claim the fast-growing fintech is now acting like a regular bank.
The announcement is likely to disappoint customers here, with financial experts saying it could be the first of many fee hikes.
People have been signing up to Revolut in their droves as the app-based financial services company is seen as a low-cost way of availing of day-to-day banking.
But one disappointed Revolut customer said: “I just got an email from Revolut telling me they are increasing the fees they charge on foreign exchange, which is what most people use them for. It didn’t take them long to be like a regular bank.”
Revolut told customers this week it plans to change its fee structure. It will charge 0.5pc on transactions in a foreign currency above €1,000 a month on its basic debit card account. At the moment customers can spend up to €6,000 a month and avoid racking up foreign exchange fees on most currencies.
The company insisted only a small number of its Irish customers would be affected by this. “Very few of our standard customers in Ireland come close to using the current free FX (foreign exchange) limit which will stay at €1,000 without charges, so for the vast majority of our customers they won’t see any increase in fees,” said Revolut.
It added that its premium and metal plans still have fee-unlimited exchange. However, there is a monthly charge for operating these accounts.
The fintech is also increasing the fee on exchange rates at weekends. The fee goes from 0.5pc to 1pc.
Revolut said a new fee will also apply for foreign currency transfers, such as sterling transfers to banks in the UK. A fee of 50c will apply.
However, sending dollars to a bank in the UK will cost a €5 fee, a so-called cross-currency payment. Fee changes will take effect on August 12.
Revolut clarified that transfer in euro from Revolut accounts will remain free to any Irish bank, as well as banks in the single European payment area, which includes the UK.
Confusion had been created because the email sent to customers on the fee changes makes reference to a new fee for transferring money from a Revolut account.
In the past few days, it has been reported Revolut has let go of staff in Portugal and Poland, prompting some to question its rapid growth.
Finance expert Daragh Cassidy, of price comparison site Bonkers.ie, warned of more fee rises. “The announcement is likely to disappoint customers and could be the first of many.”
He said Revolut still represents good value for day-to-day banking needs, but it has struggled to make a profit so more fee rises can’t be ruled out. It was recently valued at more than €5.07bn. Many commentators have questioned its rapid growth.
Mr Cassidy said Revolut rival N26 has no limit on foreign exchange fees, for now.
However, N26 charges 3pc of the value of a top-up into the account from an Irish bank’s debit card. This means it costs €1.50 to deposit €50 into a N26 account.
Banking 4.0 – „how was the experience for you”
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