Best British neobanks for non-UK residents

Being an “alien” in a foreign country is pretty difficult, but being an unbanked foreigner may be even harder

British neobanks

Best British neobanks for non-UK residents. Source: pixabay.com

Financial inclusion is just as important for assimilation as social acceptance. The bank account in your home country may appear useless abroad for many reasons: too high fees for overseas spending or cash withdrawals; inability to use them for paying local utility bills; or the need to convert currencies for every transaction.

Foreigners prefer to open a local bank account in the UK when they go there to study, work temporarily, or do business. Some tourists who are planning to stay for a while also consider opening a British bank account. Most UK banks don’t mind foreign citizenship as long as applicants do have a local residential address. However, not all of a bank’s products may be available to non-UK residents, and routine KYC checks may take much longer.

Neobanks or challengers usually facilitate the application process for their customers. Non-UK residents can also enjoy some of their services.

Revolut

One of the most highly valued neobanks in Europe currently serves legal residents of the European Economic Area (EEA), Australia, Canada, Singapore, Switzerland, Japan, and the US. Besides traditional current accounts, Revolut has been offering global business current accounts for easy international payments, with prepaid business cards and an Open API.

Personal accounts in the UK have favorable terms:

  • free subscription;
  • no fees for top-ups;
  • free virtual card and £4.99 for standard delivery of the physical card;
  • free ATM withdrawals up to £200 per month;
  • free P2P payments to other Revolut users;
  • free Cross-border payments to non-Revolut accounts within the SEPA region in EUR and SEK;
  • £0.5 for cross-border payments outside the SEPA region;
  • £3 for SWIFT payments if they are in US dollars and £5 for other currencies;
  • free currency (including cryptocurrency or precious metal) exchange up to £1,000 per month and the usage fee of 0.5% on any additional amount;
  • you can also avoid this additional fee by signing up for a Metal or Premium plan and receiving an unlimited exchange option.

Business accounts allow clients to hold, exchange, send and receive funds in 28+ currencies at the interbank exchange rate, free transfers between Revolut Business accounts, free international and local payments within the business plan allowance with a 0.4% fee on additional local transactions. International payments over the plan allowance cost £3.

Monese

Anyone who’s at least 18 years old and is a resident of the European Economic Area (EEA) is eligible for a Monese account, regardless of their citizenship or financial history. Moreover, the support and app interface come in 14 languages making it even more inclusive.

Monese current accounts come with contactless Mastercard debit cards attached. This neobank allows opening accounts in multiple currencies. You can transfer money for free when sending between Monese accounts, no matter the country or currency.

International money transfers to other banks take place using quite favorable exchange rates (not the interbank rates but close to them). The fees for cross-border transactions will be applied only in the case of the currency exchange. Thus, if you transfer GBP to EUR, you may pay 2-2000GBP extra depending on the chosen account plan and the transfer amount.  Premium members can use this service for free. You can estimate the fee by using this calculator.

Other applicable fees depend on the subscription plan of your choice. In general, those preferring a Simple (free) plan will get more additional charges whereas Premium users will pay £14.95 per month for unlimited withdrawals and foreign currency spending, and no fees on top-ups or transfers. Those in between can choose a Classic £5.95 monthly fee enabling higher top-up and transfer limits at reduced rates.

You can’t add other debit or credit cards to the app for tracking purposes, but you can link your Avios and PayPal accounts to Monese.

Monzo

You can open a Monzo account even if you’re not a UK tax resident. All you need is a UK address and a valid UK phone number. Monzo offers full UK current accounts enabling users to receive salaries, make direct debit payments and bank transfers, and open overdrafts. The challenger bank also provides prepaid debit cards.

Most transactions and financial operations with Monzo accounts are conducted free of charge. Remittance services here are powered by Transferwise which has some of the lowest rates in Europe. The only significant nuance for non-residents is the inability to receive money from outside the UK. Technically, it can be done if you use an online IBAN generator to generate an IBAN.

Yet, the bank itself admits it isn’t reliable: “Payments might take a few days to go through, or they might not reach your account at all.” Therefore, Monzo isn’t a good variant for foreign students expecting to receive some money from their parents. However, the offer is quite suitable for workers supporting their families abroad.

Cash withdrawals in any currency can be free up to a certain limit (£200 – £250 within a month). The limits may be lifted for those meeting certain criteria:

  • At least £500 was paid into a Monzo account in your name over the last rolling 35-day period, and you have at least one active Direct Debit on the same account in the same period.
  • You’ve received a Department of Work and Pensions or a Department for Communities’ payment into a Monzo account in your name over the last rolling 35-day period.
  • You’ve received a student loan payment into a Monzo account in your name over the last rolling 8-month period.
  • You’re sharing a Monzo Joint Account with someone who has done at least one of the above.

Those who have multiple bank accounts in different financial institutions may prefer the Monzo Plus plan. For a monthly fee of £5, you’ll get other bank accounts and credit cards visible in the Monzo app. Such functionality gives one better control over finances and facilitates money management. You can also create up to 5 virtual cards and use them for online shopping. This way, you’ll keep your physical card details safe.

Monzo Plus doubles the limits of free cash withdrawals abroad, so non-UK residents may appreciate it when they travel to their home country. Other great features include personalized budget tracking, interest earned on the account balance, connected savings accounts, tracking your credit score, and special offers from partners.

Starling

Starling welcomes customers of all nationalities and tax residencies as long as they are over 16 and live at a UK address. Of course, you’ll also need a valid UK mobile number since the whole registration process is based on that.

Starling’s current account offers zero-fees on electronic payments, receiving payments, domestic transfers, cash deposits, and ATM withdrawals. The neobank also rewards those trusting it with storing their money. Starling pays interest of 0.05% AER on balances up to £85,000. The unique feature of this bank account is mobile cheque deposits. Users can take a photo of the cheque up to £500 via the app, and then receive the funds within two working days.

The bank has also taken good care of savings options, P2P transactions, budgeting features, and overdrafts. Travelers will enjoy using their Starling debit card abroad without additional costs. The currency exchange will happen using standard MasterCard terms.

Debit cards can be topped up at the post office which is an alternative to physical bank branches. Customers can also withdraw cash from their Starling account there. This may appear a crucial option for those non-UK residents who receive their salaries in cash as gig workers, or exchange money received in foreign currencies. People receiving cash remittances would also appreciate more chances to top up their current accounts, considering that many remittance companies have their branches at post offices too.

In 2018 Starling became the first UK bank to allow users to set up Google Pay from the bank’s native app. Before the physical card arrives, Starling users can already link their virtual card to Google Pay and Apple Pay. Samsung Pay, Garmin Pay, and Fitbit Pay can be set up once your card has arrived in the post.

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