The announcement is likely to disappoint customers and could be the first of many.
We’re huge fans of Revolut here at bonkers.ie. The UK-based fintech has helped revolutionise banking since its launch only a few years ago with its beautiful and easy-to-use app, its lack of foreign exchange fees and its largely fee-free day-to-day banking. And despite a few disgruntled customers voicing complaints online about poor customer service, it’s fair to say not a lot of people have had a bad word to say about the company.
However, that may be about to change as Revolut has taken many by surprise by announcing some small but still significant changes to its fee structure.
The biggest change is around foreign exchange fees.
Previously customers could spend up to €6,000 a month and avoid racking up any foreign exchange fees on most currencies. This limit is now decreasing to just €1,000 a month, which, even though according to Revolut most people won’t hit, is still a big reduction. Above this limit, the fee will stay the same at just 0.5%, and Revolut will let you know if an exchange will be subject to a fee. Premium and Metal cardholders still have unlimited exchange, as they always have.
The markup on exchange rates at weekends is also increasing. Currently Revolut customers avail of the Interbank exchange rate on weekdays with a 0.5% markup added to currencies at weekends. This is now increasing to 1%. This is still likely to be a much better rate than you’d get with your bank but the gap (at weekends) will close.
If you make a transfer to an account outside of your country, only your first payment each month will now be free; after that there will be a fee of €0.50 per payment. However payments to other Revolut users, transfers in euros to accounts in Ireland, and transfers in euros within the Single Euro Payments Area are remaining free.
But if you want to send sterling to the UK, or dollars to America for example, you'll be charged 50 cent going forward after your first transaction.
Finally, if you make a transfer to a country that is not in its national currency, there will be a fee of €3 for US dollar transfers (like US dollars being sent to the UK) or €5 for non-US dollar transfers (like sending sterling to Brazil).
Revolut is saying it will always let customers know if a transaction they are about to make will incur a fee.
When are the changes coming in?
These changes will take effect on August 12, 2020.
Revolut also says it's changing its operations to allow it to reverse some payments made by mistake into other Revolut accounts. So basically if you Revolut someone some dosh and then realise you've sent it to the wrong account, not all will be lost.
Things like contactless transactions, mobile payments and chip and pin will remain free, as will topping up your account. For now at least.
The first of many?
Revolut recently celebrated signing up its one millionth customer in Ireland. And with so many of us now hooked on the app, maybe we shouldn’t be so surprised to see it implement some revenue raising measures. It’s not a charity after all. The question is whether this is the first of many price change announcements.
Revolut still represents incredibly good value for all your day-to-day banking needs but it has struggled to make a profit so more fee increases in the future can’t be ruled out.
Any other options?
Although not nearly as popular in Ireland as Revolut, N26 is a great alternative and has no limit on foreign exchange fees - for now. It's also covered by the German government Deposit Guarantee Scheme. However it does charge a 3% fee for instant top-ups. See here for more info on how these two providers compare.