First look at Revolut: Send and spend money globally with zero fees

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Thanks to my interest in manufacturing spend to increase credit card rewards, I’m always excited to see new options for moving money around.  New no-fee prepaid cards can be exciting too (Remember Redird?).  How about one product that does both?   Via Laptop Nomad on Inside Flyer I learned about a new product called Revolut.

Revolut is made up of two parts: an app (iPhone or Android) and an optional physical prepaid card called RevolutCard.

Revolut Card

The app is an interesting product all on its own.  Once you sign up, you can add money for free with a debit card or via online bank transfer.  Once money is added, you can convert funds between US Dollars, Euros, and British Pounds at will.  You can send money to other Revolut customers, or you can spend the money in your account by using the included virtual MasterCard (each user gets their own card number, expiration date, CVV code, and PIN).  You can also withdraw money to your bank account (theoretically).

Within the Revolut app, you can also request a physical card: the RevolutCard.  This appears to be a prepaid card with true Chip & PIN capability.  It can be used for credit, debit, or ATM transactions worldwide with no fees (other than unavoidable fees such as those charged by ATM operators).

Fees

None… yet.  Revolut promises no fees for the first 12 months of being a customer.  Here are the details from their FAQ:

The Revolut app and multi-currency card are completely free.

Revolut offers the very best exchange rate available and applies no charges or fees. We guarantee this for the first 12 months of being a Revolut customer.

Revolut headstand

The photo above is taken from a Revolut video.  The Revolut lady is apparently so happy about Revolut that she stands on her head.  She follows up with a cartwheel (not shown).

Adding Funds

Revolut AppI was interested in seeing whether debit gift cards would work to load Revolut.  I first tried a US Bank MasterCard gift card (that I had bought as OfficeMax).  After registering my name and address with the gift card, I clicked “top Up” in the Revolut app and entered my gift card details.  No dice.  How about my no longer useful US Bank Buxx card?  Yep, that worked.  I successfully moved the final $300 from my Buxx card to my Revolut account.  Nice!  Later I tried a $300 Metabank Visa card from Staples.com.  No only did that not work, but it also resulted in my Revolut account being blocked by their automated security.  At their request I emailed a photo of my passport and my Buxx account showing the successful $300 top-up.  In less than an hour my account was unblocked!

 

It’s also worth noting that you can only top up a total of $1500 per year unless you verify your identity.  The app has a built in “Verify My Identity” feature which is apparently intended to scan your drivers license or passport.  Unfortunately, I couldn’t get either to work.  My account now shows “Sorry, we couldn’t verify you automatically. We will review…”

Invite a friend

When you click the “Send” button at the bottom of the app, you’ll see an option to “Invite a Friend. And get £5, when they top-up.”  So, I invited my son.  He signed up with my link and added $25 (of my money) to his account.  I expected 5 pounds to appear in my account, but it didn’t.  Luckily, the app has an in-app Support-Chat feature.  I used that and within minutes support rep Gus had added $5 (not £5) to my account and signed off with a friendly “cheers”.

Rather than trying to make money off your friends, I’d recommend having them try a promo code so that they can get £5 (or $5) themselves.  According to this page, anyone can use the promo code MSE when registering the app and they’ll get £5 (or $5) after adding £10 (or, maybe $10), to their account.

Before trying this yourself, though, I highly recommend you read the rest of this post…

UPDATE 10/28/2015 1:15PM: My son loaded with a PNC debit card and was charged a foreign transaction fee. Make sure to use a debit card that has not foreign transaction fees when topping up.

Send money

My son used the Send Money feature to send $25 to my account (it was my money, after all).  The app automatically found people in his contacts that were Revolut users (i.e. it found me).  And, the rest was just as simple as you’d expect.  He typed in the amount to send and the $25 appeared in my account pretty much right away.  Cool.

Exchange funds

I didn’t have any real immediate need to exchange funds, but I tested out the feature anyway.  I started by converting $10 to €9.05.  Then, I took my €9.05 Euro balance and converted it to £6.52. Then, I took my 6.52 Pounds and converted to US Dollars.  I figured that if Revolut was really using published exchange rates without taking any off the top, I would end up with $10 back.  In the end, I got back $9.97.  In my mind, that’s close enough.  The missing 3 cents could be due to necessary rounding when converting from one currency to another.

Withdraw

The Withdraw feature turned out to be a bit more difficult than I had hoped.  When I first clicked “Withdraw”, I entered my bank routing number and account number and the amount I wanted to withdraw.  The result: “We’re sorry, something has gone wrong. Please try again.”  So, I tried again, but with the same result.

Revolut Withdrawal Error

Via support chat, Gus informed me that:

We do not allow withdraws to local US bank accounts yet.  You will need to use IBAN and swift (putting your account number in the IBAN section).

Thanks Gus, but ugh.  I checked with a couple of the banks that I have accounts with to see if they would charge a fee for accepting an international transfer.  PNC?  $15.  US Bank?  $16.  Luckily I had recently opened a CitiGold checking account (to get 50,000 points, of course).  Citi normally would charge a fee, but not to CitiGold customers.  Cool.  Citi told me to use their swift code: CITIUS33.  As Gus suggested, I put my account number in the IBAN section and CITIUS33 in the BIC section.  Result: Error.  I tried again.  Another error, but this time $100 disappeared from my account (luckily it reappeared a few hours later).

Later, I chatted with support again, and Anuj (what happened to Gus?) told me that it should work now.  So, I tried again and it appeared to work!  Unfortunately, it will most likely take several business days for the funds to show up in my account, so I probably won’t know for sure about this feature until next week.

The card

Revolut lets you request a physical RevolutCard, for free.  Unfortunately, the first few times I tried to request it, the app timed out.  Finally, after my son surprised me by ordering his card without any trouble, I tried again and it worked!

I’m looking forward to trying out the physical card once it arrives.

My take

I really want to like Revolut, but at this point it feels less than half-baked.  If you read through the post, above, you’ll see that I encountered quite a few bugs or incomplete features while testing out the Revolut app.  Often, though, things would work after a while.  It felt like there were a couple of programmers watching my struggles and fixing code on the back end in real time.  If that’s true, that’s worrisome in itself since I’d like to see financial systems (especially the back-end systems) go through rigorous testing with every release.

It was disappointing, but not surprising, that Revolut wouldn’t accept my gift cards for funding.  I would like to try other debit cards to see what works and what doesn’t, but I don’t really want to get my account locked again.  If you try any interesting cards, please let me know the results.

Aside from the manufactured spend angle, I think that Revolut and the RevolutCard has great promise for travelers and/or those who need to exchange money with people in other countries.  In the latter case, it seems close to perfect: no fees, instant transfers.  If they ever get around to supporting US bank accounts, it will be especially useful.  For travelers from the US, the card offers a free and easy way to get true Chip & PIN capability (most US credit cards now offer only Chip & Signature).  I still recommend using a rewards credit card with no foreign transaction fees as your primary method of payment while traveling, but having the RevolutCard in your pocket for unattended terminals and for ATM withdrawals may make sense.

My recommendation right now is to wait until Revolut cleans up the bugs and adds support for US bank accounts.  Why the caution?  If you add money to your account, I can’t promise that you’ll be able to get it back.  If you try Revolut anyway, please let me know how it goes.

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