Last Updated on October, 2024
Monzo is a digital bank based in London with a core value being transparency. Of course, any financial institute that is clear in its operations and how it handles your hard-earned money is everyone’s top priority.
Better than most others, Monzo has a dashboard that gives real-time information regarding annual reports to system status. So you know what you’re getting.
Moreover, did you know? Monzo is the 7th largest bank in the UK in terms of customer numbers.
But is this enough for you to take the leap and start using their service? No, there are so many other factors to consider when deciding whether or not their service suits your needs.
In this detailed Monzo review, we’ll determine whether you should go for their service or not and under what circumstances. So keep on reading till the end.
Contents
- Monzo Features in a Nutshell
- How Does Monzo Work?
- Opening Your Monzo Bank Account
- Different Account Options Monzo Has to Offer
- What Monzo Has to Offer?
- Borrowing With Monzo
- Savings and Investment With Monzo
- What Does Monzo Charge for its Service?
- Signing Up for Monzo
- Is Monzo Safe to Use?
- Customer Service and Reviews
- Monzo Pros & Cons
- So, is Monzo any Good?
- Frequently Asked Questions
Monzo Features in a Nutshell
| Established in | 2015 |
| Headquarters | London, UK |
| Clients served | Both business and personal |
| Service availability | Mobile and online |
| Safety | UK Regulated |
| Security | Deposit protection, PIN, Face ID, and Touch ID |
| Fees | Based on the account type |
How Does Monzo Work?
Let’s begin our Monzo review by understanding how it works.
Monzo works just like other traditional banks or banking apps. But it has so much more to offer to the customers. When you apply for Monzo’s current accounts, you’ll get a Mastercard that you can use without paying any additional costs all across the globe.
The best part is that you can track your savings and spending within the app. No need to jot down anything separately anymore. The only difference here with Monzo is that you can’t visit a physical location or a bank branch.
But what if you lose your card, you might ask? Well, you can freeze or unfreeze your lost card using the app. Just get in touch with their customer service through the app (live chat) to share your issue, and they will sort it out for you.
Opening Your Monzo Bank Account
Next up in our Monzo review is how to open your Monzo business or personal account.
To open your Monzo business or personal account, you must be at least 16 years old and live in the United Kingdom. You’ll only need your smartphone, and you must provide them with your valid ID. It can either be your national ID card, passport, or driving license.
Just download the app and enter your details, including your name, date of birth, and home address, to verify your identity. Moreover, Monzo will ask you to upload a selfie video alongside a photo ID.
Once Monzo verifies your account, they will send you the Monzo card by post which should only take a couple of days. But if you want to use your card instantly, you can add it to Google Pay or Apple Pay and use it right away.
Different Account Options Monzo Has to Offer
Now, let’s talk about different accounts on offer in this Monzo review. At present, Monzo offers four different types of accounts (excluding a savings account),
Monzo Current Account
This is similar to standard current accounts in the United Kingdom without any fees. You can use it to withdraw and spend cash across the globe anywhere where Mastercards are accepted. You’ll be able to manage your expenses using the Monzo app for your current accounts.
Monzo 16-17 Accounts
This account is designed for teenagers, and it has almost all the features that current accounts have. The only difference is that Monzo has blocked spending on anything illegal if you’re under 18 (gambling, etc.)
Monzo Business Account
You can either choose Monzo Business Lite (free) or Monzo Business Pro (paid – GBP 5 a month). Businesses can even apply for the Monzo Business A/C if they are a sole trader or have a registered limited company with shares in the UK (and paying tax in the United Kingdom).
If you already have a Monzo current account, you can go for Monzo Business by just using your app.
Monzo Joint Accounts
As long as both individuals have Monzo current accounts, opening a joint account is simple, and it can be done using the app.
Both individuals will receive a new joint account card and both of you can see who made the transaction. You can set monthly budgets, and you will get your alerts if it seems you’re spending too quickly.
What Monzo Has to Offer?
Of course, with Monzo, you’ll get a specific type of account that you need, and along with that, you’ll get a Mastercard to spend and make withdrawals.
In addition to that, Monzo offers the following features to its customers:
How’s Monzo As an App-Based Bank?
Monzo, as an app-based bank offers a streamlined service, but it does come with limits. If you’re looking for highly customizable features, such as an online application for managing your expenses and getting paid, Monzo can work pretty well.
Nevertheless, if you prefer an in-person service and walking into banks and talking to someone about your money, Monzo is not right for you.
Can I Use Monzo Internationally?
You can opt for Monzo to make an international payment wherever Mastercard service is accepted. It means that you can use it pretty much everywhere (excluding North Korea, Cuba, and Bulgaria). You might need to activate a magstripe to use foreign ATMs in some cases.
Borrowing With Monzo
Now, let’s talk about borrowing in this Monzo review. You can also borrow from Monzo as you would from conventional banks.
Monzo Credit Checks:
When you apply to open your account with Monzo, they will run a soft credit check or quotation search. This check is to find out if you’re eligible for an optional overdraft without impacting your credit score.
If you pass this soft credit check, you’ll have the option to go for an overdraft. And if you go for the overdraft, a hard credit check will appear on your credit report.
Monzo Overdrafts and Loans:
As we have already established, Monzo does offer overdrafts or loans if you have a Monzo bank account. Depending upon your eligibility, you can get up to GBP 3,000, and you can alter the limit or cancel the overdraft.
Interest will be accrued at 19%, 29%, and 39% EAR (equivalent annual rate or the rate that is used when you borrow money), and there won’t be any hidden charges.
They also offer loans of up to GBP 3,000 that you can pay back in a few years (3 years or less). There are sliders within the smartphone application that you can adjust to decide how much you want to borrow and choose your repayment date.
You can also alter the repayment date so that there are no additional fees. If Monzo accepts your loan, the amount will appear in your account and be ready to spend on the same date. Whether the loan is for home improvements, a wedding, or a new car, you can give it a name and add an image to it.
Your loan will be right next to your Bill Pots and you can see the progress of your repayment. There are no additional fees for paying your loan back early or for any extra repayments.
Savings and Investment With Monzo
You can also save and invest with Monzo Premium, and they will pay interest on it. You can earn interest on your savings, and Monzo pays 4.60% AER (annual equivalent rate or the rate that is used for savings). The rate applies to a 12-month fixed pot (GBP 5,000 minimum deposit).
And fixed means that you’ll be locked away for this period, and interest is earned on it. You can also go for easy access savings that will enable you to get your money back on the next working day.
What Does Monzo Charge for its Service?
Monzo offers free international purchases. Well, let’s further our Monzo review and find out how much “free” is free in these international purchases.
Fees
They only charge a 3% service fee for withdrawals that go over GBP 200 every 30 days outside the United Kingdom (the free part). Now, this cost can be fairly significant because GBP 200 in 30 days is not a lot of money.
Exchange Rates
Monzo has the Mastercard exchange rate for currency conversions. This rate is different from the mid market rate. There might not be any additional fees here but the Mastercard rate is not better than the mid market rate. But you’ll get much better rates in comparison to any bank (that’s for sure).
Signing Up for Monzo
First of all, you’ll have to download the Monzo application on your smartphone and then sign up. You can also sign up on a desktop using the Monzo website. As there are no branches to verify your identity, you have to submit a brief selfie video during your application.
The signup process is fast, and address verification is not mandatory. Therefore, you can open your Monzo business or personal account before you move to the UK and finance your account. But you’ll need a UK address to open your account and get your card.
You can begin using your personal account after opening it. Just download the Monzo app, connect it with Apple Pay or Google Pay, and start using your account without your card (on the same day).
Is Monzo Safe to Use?
Monzo is registered in the UK, and it is safe to use as different safeguards keep your money secure. For instance, the money you put in your account with Monzo (up to GBP 85,000) is under the protection of FSCS (Financial Services Compensations Scheme).
Apart from that, Monzo has many security initiatives. For instance, Monzo asks to verify online purchases by text or in-app to make sure that your phone/card/app access is in your possession.
Customer Service and Reviews
Monzo is highly regarded for its quality customer service as long as you are in charge of your account. They have live chat support in the application and it is fairly quick to respond.
But they don’t have phone support, so anyone who prefers human interaction won’t be too impressed by what the app-based bank has to offer here.
However, most of the negative reviews from customers regarding Monzo go around frozen accounts. But this is a way Monzo prevents fraud or suspicious activities.
Monzo can freeze/block accounts without any warning and that too for weeks without relinquishing the funds. This can be troubling because some customers go stranded abroad without any access to their finances.
But this is something associated with most Mastercard-based services, and not just Monzo. Therefore, it is best to have a traditional account in a bank with a credit card as a backup.
There are almost no complaints from customers regarding hidden fees and a few complaints about service speeds. It means that Monzo delivers excellent service to its customers.
Monzo Pros & Cons
Pros
Cons
Other online bank reviews and comparisons:
So, is Monzo any Good?
Monzo is pretty impressive when it comes to managing your finance. But they are also very transparent in their operations which makes them reassuring in their services. Get Monzo today and join the community of satisfied customers.
The only thing that can stop you from having an account with Monzo is if you prefer a traditional bank and it’s working over an app-based bank. Therefore, it’s all about your preferences and which route you take to manage your finances.
Frequently Asked Questions
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