Is the era of affordable Revolut about to end?

I received interesting email last week related to Revolut and the increase of their fees. It made me wonder, would this be the end of the expansion of Revolut?

You will find out my thoughts about it in this article.

What is Revolut?

Revolut is a Fintech company which provides Banking like services and is regulated by the British government and the Latvian banking regulators. It also provides additional services like cheap currency conversions, cheap transfer of funds between different governments and a simple way to split bills and transfer money among Revolut members.

It is extremely popular among millennials and digital nomads. I am also a paid user, who has a fancy metal card.

I had used their services to send money, buy stocks and split bills with friends. I really like their easy-to-use app based approach to money management.

What Revolut change in 2021?

In one word – a lot!

Trading

For many people who were curious to get into trading, the 3 free commissions trades per month were enough. With the new regulations, they will now have only 1 such transaction monthly. It is clear that Revolut wants you to upgrade to another plan. As you can see in the table 1. If you want to keep the same level of trading, you need to upgrade to the next price level, which is the Plus.

Also, now the fees for keeping your positions per year increased to 0.12% from 0.01%, which might not look as a lot at first unless you look more carefully and see that this is actually an increase of 12 times!

Also, you don’t own the stocks, but a3rd party company is facilitating the purchases of both stocks and BTC and crypto. This is an additional risk in case that company got busted.

ATM withdraws

The ATM withdraws is the next thing changed. Now, not only you have a limit to the amount of money you can withdraw per month, but you also need to be careful about the amount of times you withdraw money. No matter if you reach your limit or not, if you withdraw over 5 times per month, you will need to pay overcharge.

WEEKDAY EXCHANGE FEES

There is no change in the weekdays exchange policy, but it’s good to remind us what it is. According to their site, there are fees for people who use the standard plan, but also I had seen that even on the metal plan, the exchange rate over the weekend is not the best one.

Remember, if you exchange more than £1,000 during the month (in foreign exchange, cryptocurrency or precious metals), a fair usage fee of 0.5% will begin to apply in addition to the fees below. You can avoid this fair usage fee by signing up to a Metal or Premium plan and receiving unlimited exchange.

src: https://www.revolut.com/legal/fees#exchange

International money transfer

Revolut is a fairly good option if you want to send euros over SEPA transfer. SEPA stands of Single Euro Payments Area (SEPA). However, sending in a different currency or outside of the EU using SWIFT (Society for Worldwide Interbank Financial Telecommunications), will give you only 1 free allowance per month. Just be careful and take this into an account!

Summary

Below you will find a comparison between different plans and how the new fees will look like. Do you still think that Revolut is a good option to be used for 2021?

My personal opinion is that the appeal for free or low-cost money movement is fading away and the company becomes more and more like an ordinary bank, which might be a good thing, because it will become a sustainable business. On the other hand, I am excited about TransferWise and their new direction and I might choose to explore their services and use more of their products in 2021, just because they provide a better transparency about the fees and a better visibility about the exchange rates during the weekend and a better value. They also have a debit card just like Revolut does.