How we got customers to sign up to Monzo in the early years(tomblomfield.com)
tomblomfield.com
How we got customers to sign up to Monzo in the early years
https://tomblomfield.com/post/691384431502557184/monzo-growth
119 comments
Before starting Monzo they attempted a hostile takeover of Starling but we’re rebuffed by the founder. Tom took basically all
The staff and started Monzo, so I can imagine he doesn’t want to draw too much attention to it.
Anne Boden’s book is worth reading if your interested in the early history of digital first banks in the UK
https://www.goodreads.com/book/show/51007680
Anne Boden’s book is worth reading if your interested in the early history of digital first banks in the UK
https://www.goodreads.com/book/show/51007680
The irony is that Starling is consistently the better bank, from my perspective.
I started off getting Monzo when it advertised itself as a pre-paid debit card and it's big selling point was free foreign ATM transactions. I never actually used it all that much (I've been with them about 5-6 years, and maybe done about £1000 total foreign withdrawals).
At some point when they introduced limits, there was a post on their forum comparing them to Starling, Revolut and N26 and others. N26 was a bit of a hassle, but I got the other two just in case I needed more than the £200 a month you were now allowed.
Since then, the service at Monzo has steadily declined, as they decide to start charging fees for this that or the other than used to be free, adding more and more junk dressed up to look pretty, but every month or so the service gets degraded a little more somehow. An extra charge here. A restriction there. More in-app advertising for services I don't want, etc.
And yet throughout that, Starling has continued to do everything you'd expect from a bank, and with the convenience of an online bank. Their app hasn't really changed at all in that time, and yet somehow it's still better than Monzo's. Simpler, sure, but certainly less annoying.
It's telling that I've never felt comfortable trusting Monzo with my salary, because it always feels like it'll fold any moment, so I've always had my salary paid into a "real bank" and just have a standing order each month to transfer £500 a month for monthly expenditure, but pay most bills directly from the old brick and mortar bank. I needed to keep that old account around anyway, because Monzo makes life impossible if you need occasionally to use cheques.
And so, when I started a company and needed to choose a bank for my business account, it was a no brainer - Starling.
I started off getting Monzo when it advertised itself as a pre-paid debit card and it's big selling point was free foreign ATM transactions. I never actually used it all that much (I've been with them about 5-6 years, and maybe done about £1000 total foreign withdrawals).
At some point when they introduced limits, there was a post on their forum comparing them to Starling, Revolut and N26 and others. N26 was a bit of a hassle, but I got the other two just in case I needed more than the £200 a month you were now allowed.
Since then, the service at Monzo has steadily declined, as they decide to start charging fees for this that or the other than used to be free, adding more and more junk dressed up to look pretty, but every month or so the service gets degraded a little more somehow. An extra charge here. A restriction there. More in-app advertising for services I don't want, etc.
And yet throughout that, Starling has continued to do everything you'd expect from a bank, and with the convenience of an online bank. Their app hasn't really changed at all in that time, and yet somehow it's still better than Monzo's. Simpler, sure, but certainly less annoying.
It's telling that I've never felt comfortable trusting Monzo with my salary, because it always feels like it'll fold any moment, so I've always had my salary paid into a "real bank" and just have a standing order each month to transfer £500 a month for monthly expenditure, but pay most bills directly from the old brick and mortar bank. I needed to keep that old account around anyway, because Monzo makes life impossible if you need occasionally to use cheques.
And so, when I started a company and needed to choose a bank for my business account, it was a no brainer - Starling.
> It's telling that I've never felt comfortable trusting Monzo with my salary, because it always feels like it'll fold any moment
In which case you will be protected up to £85,000 by the FSCS.
In which case you will be protected up to £85,000 by the FSCS.
as long as you've got another account to pay it into?
and don't mind being without your money for some time
(personally I wouldn't have my salary paid into a bank that's losing ever increasing sums of money)
and don't mind being without your money for some time
(personally I wouldn't have my salary paid into a bank that's losing ever increasing sums of money)
> as long as you've got another account to pay it into?
I'm guessing you would just open up another account.
But I understand if you wouldn't want to be without your current account to pay bills etc.
I'm guessing you would just open up another account.
But I understand if you wouldn't want to be without your current account to pay bills etc.
>> It's telling that I've never felt comfortable trusting Monzo with my salary, because it always feels like it'll fold any moment
Can you elaborate more on this, the fold part?
>> from the old brick and mortar bank
Which such bank/s you recommend?
PS: I have been in UK for quite a few years now and only use Monzo.
Edit: typo and query
Can you elaborate more on this, the fold part?
>> from the old brick and mortar bank
Which such bank/s you recommend?
PS: I have been in UK for quite a few years now and only use Monzo.
Edit: typo and query
Of the "traditional" banks First Direct generally have quite a good reputation. I've used them for a while and they've been fine. Customer service is good on the occasions I use it and the product's been reliable.
That said I'd be surprised to see a bank like Monzo just fold without warning. It's possible that one or more of the "challenger" banks won't last a long time, but the outcome there will most likely be them getting bought by someone else.
That said I'd be surprised to see a bank like Monzo just fold without warning. It's possible that one or more of the "challenger" banks won't last a long time, but the outcome there will most likely be them getting bought by someone else.
I thought the first internet bank was Smile https://en.wikipedia.org/wiki/Smile_(bank) , but it looks like the claim is "first fully digital bank".
Good old Monzo times.
Sadly, in my opinion the company took on too much investment and was now bound to deliver tech-company returns with a product that fundamentally isn't compatible with them. This led them to become yet another bullshit "growth & engagement" operation and ultimately killed the appeal of the product, all while competitors such as Starling Bank stepped up their game and delivered a very similar product that is not only profitable but doesn't have those "growth & engagement" vibes because they didn't have the same pressure and could afford to take things slow.
Sadly, in my opinion the company took on too much investment and was now bound to deliver tech-company returns with a product that fundamentally isn't compatible with them. This led them to become yet another bullshit "growth & engagement" operation and ultimately killed the appeal of the product, all while competitors such as Starling Bank stepped up their game and delivered a very similar product that is not only profitable but doesn't have those "growth & engagement" vibes because they didn't have the same pressure and could afford to take things slow.
A bit ironic given Tom literally worked for Starling at the beginning. A bit odd that this doesn’t get a mention.
yeah, as far as I'm aware the only reason Monzo exists is because of a falling out between Tom and the Starling CEO
I don't know what really went on, but Starling's side was reported in the UK press: https://www.thetimes.co.uk/article/starling-bank-boss-anne-b...
I don't know what really went on, but Starling's side was reported in the UK press: https://www.thetimes.co.uk/article/starling-bank-boss-anne-b...
Steven Bartlett has a really insightful with Tom Blomfield about this [1], and then also with Starling CEO Anne Boden [2]. While I'm generally not a great fan of his podcast, these two I found to be fascinating.
[1] https://podcasts.apple.com/dk/podcast/e86-monzo-ceo-on-death...
[2] https://podcasts.apple.com/us/podcast/e107-starling-bank-bui...
[1] https://podcasts.apple.com/dk/podcast/e86-monzo-ceo-on-death...
[2] https://podcasts.apple.com/us/podcast/e107-starling-bank-bui...
Thanks - I read Anne Borden’s book so will be interesting to hear Tom’s side too.
What defines a "growth & engagement operation"? Is it when the goal is to grow as much as possible, while engaging users without actually meeting users needs or retaining them?
When the objective isn't to sell a product/service and make profit on it, but instead to "grow" and increase arbitrary numbers such as user or "engagement" counters to use them to raise more VC money or sell the (non-profitable) business to a bigger sucker.
I was one of the early adopters. Monzo felt fresh and exciting back when it started, kind of like Google in its early days. But I later switched to Revolut and never looked back. I was driven purely by intuition and no particular reason.
While trying to understand why, I thought it was probably because there was too much PR and fuzz around Monzo as an "ethical business" and little action. You don't just talk about being ethical or caring about the customers (most data collection companies say "we value your privacy"). You prove it by doing, by delivering an amazing product and customer support, and by showing how you are going to turn profitable. Revolut and other competitors talk less but you can see they are doing reasonable job on all fronts.
While trying to understand why, I thought it was probably because there was too much PR and fuzz around Monzo as an "ethical business" and little action. You don't just talk about being ethical or caring about the customers (most data collection companies say "we value your privacy"). You prove it by doing, by delivering an amazing product and customer support, and by showing how you are going to turn profitable. Revolut and other competitors talk less but you can see they are doing reasonable job on all fronts.
I would try Monzo, but all I get from them is
> Unfortunately we can't offer you a Monzo account
> We're afraid we can't go into more detail about why we can't offer you an account.
> We assess every application using details you've given us, and any information we get from the credit reference agencies we use (Experian and TrnsUnion) or from anti-fraud services like Cifas.
Starling is the same. As a debt-free UK resident without any UK driver's licenses, utility bills, benefit claims, gun certificates, electoral register or GP records, the only bank that is willing to do business with me is Revolut.
Not having any credit history is becoming a barrier to access more and more services that require an identity check. While it is understandable that companies want to protect themselves from fraud, this trend is making it difficult for people who don't have a credit history to access basic services. This is creating a significant barrier for certain groups of people, and it is something that should be addressed. When it comes to providing essential services to those who fall through the cracks, Revolut may be more ethical than the other options.
> Unfortunately we can't offer you a Monzo account
> We're afraid we can't go into more detail about why we can't offer you an account.
> We assess every application using details you've given us, and any information we get from the credit reference agencies we use (Experian and TrnsUnion) or from anti-fraud services like Cifas.
Starling is the same. As a debt-free UK resident without any UK driver's licenses, utility bills, benefit claims, gun certificates, electoral register or GP records, the only bank that is willing to do business with me is Revolut.
Not having any credit history is becoming a barrier to access more and more services that require an identity check. While it is understandable that companies want to protect themselves from fraud, this trend is making it difficult for people who don't have a credit history to access basic services. This is creating a significant barrier for certain groups of people, and it is something that should be addressed. When it comes to providing essential services to those who fall through the cracks, Revolut may be more ethical than the other options.
> the only bank that is willing to do business with me is Revolut.
That's because Revolut isn't a UK bank. Until very recently (less than a year ago), it wasn't a bank at all anywhere. Unlike Monzo, Starling et al. (which are UK banks) Revolut is an "electronic money institution" and hence your balance isn't protected by the Financial Services Compensation Scheme (FSCS).
That's because Revolut isn't a UK bank. Until very recently (less than a year ago), it wasn't a bank at all anywhere. Unlike Monzo, Starling et al. (which are UK banks) Revolut is an "electronic money institution" and hence your balance isn't protected by the Financial Services Compensation Scheme (FSCS).
I didn't realise this. Why would anyone accept this risk and use Revolut as anything more than a place for pocket money while abroad?!
People who have no choice or don't know any better.
I hope @mojuba is now aware of this. This is not a good "bank if you have other options. Going back to Monzo would be a better choice.
They have recently become a real bank and converted the customers' accounts to real current ones. They are a UK bank though due to Brexit for EU-based customers they are a Latvian one (I think).
Perhaps it is different for the UK part. According to https://www.fscs.org.uk/check-your-money-is-protected/ Revolut Ltd money is not protected:
> Money at risk
> Reason why
> Revolut Ltd is an e-money institution. FSCS can't provide protection if an e-money institution fails.
Money in Revolut savings accounts ("vaults"?) is apparently protected as that money is held with real banks, not Revolut Ltd.
> Money at risk
> Reason why
> Revolut Ltd is an e-money institution. FSCS can't provide protection if an e-money institution fails.
Money in Revolut savings accounts ("vaults"?) is apparently protected as that money is held with real banks, not Revolut Ltd.
> Not having any credit history is becoming a barrier to access more and more services that require an identity check.
Agreed. My husband and I are against debt on principle and it really irritates me that credit history is being used for identity checks. I accept the trade off that a lack of credit history would make it more difficult for me to get credit in the future, but it should not affect my access to non-debt-related services.
We’ve already encountered this problem once [0] and I’m concerned that it will become even more of an issue going forward.
[0] My husband was not able to create an online account with the social security administration because their identity system didn’t have enough info on him to even attempt to verify his identity. He couldn’t even go in person to set it up because the local office was closed due to COVID.
Agreed. My husband and I are against debt on principle and it really irritates me that credit history is being used for identity checks. I accept the trade off that a lack of credit history would make it more difficult for me to get credit in the future, but it should not affect my access to non-debt-related services.
We’ve already encountered this problem once [0] and I’m concerned that it will become even more of an issue going forward.
[0] My husband was not able to create an online account with the social security administration because their identity system didn’t have enough info on him to even attempt to verify his identity. He couldn’t even go in person to set it up because the local office was closed due to COVID.
The problem of lacking credit history has been around for a long time, I remember getting a credit card, which I paid off in full every month, just to increase my credit score ~ 20 years ago.
For people without a good credit history in the UK there is meant to be "basic bank accounts" which don't require credit checking as they don't offer overdrafts (https://www.moneyhelper.org.uk/en/everyday-money/banking/bas...)
That said, you will still need proof of identity/address. If a bank is taking you on without those, I'd struggle to see how it's meeting KYC (Know your customer) requirements.
For people without a good credit history in the UK there is meant to be "basic bank accounts" which don't require credit checking as they don't offer overdrafts (https://www.moneyhelper.org.uk/en/everyday-money/banking/bas...)
That said, you will still need proof of identity/address. If a bank is taking you on without those, I'd struggle to see how it's meeting KYC (Know your customer) requirements.
As far as I know the aforementioned banks merely check for a credit bureau record (and absence of any fraud markers) to use for KYC as opposed to for credit eligibility, so if he's being rejected for those his problem is not creditworthiness but the complete lack of CRA record. It's unlikely he'll qualify for any credit card with absolutely zero records.
His best bet is to open an account at a brick & mortar bank which will be able to verify his identity using physical documents and not only skip the CRA check, but actually create a CRA record (which can be a good or bad thing depending on your opinions regarding privacy). After a year or so, he should become eligible for those accounts accounts (if the lack of CRA record is truly what caused them to reject initially) and even qualify for a credit card if needed.
His best bet is to open an account at a brick & mortar bank which will be able to verify his identity using physical documents and not only skip the CRA check, but actually create a CRA record (which can be a good or bad thing depending on your opinions regarding privacy). After a year or so, he should become eligible for those accounts accounts (if the lack of CRA record is truly what caused them to reject initially) and even qualify for a credit card if needed.
The page I linked gives that info for the UK :) including alternative identity proof where traditional information might be lacking.
The page also lists the banks which provide the "basic bank account" service, which scanning down them appear to be primarily traditional ones (although with branch closures in the UK that's getting less like bricks and mortar by the year.)
The page also lists the banks which provide the "basic bank account" service, which scanning down them appear to be primarily traditional ones (although with branch closures in the UK that's getting less like bricks and mortar by the year.)
Thank you for your insightful comment explaining how the CRA process works. I'm not interested in credit, but it is good to know that it takes a year merely to qualify for a score.
Last year, I stuffed every document I owned into a folder and went to a brick & mortar bank to open an account. No dice. The customer adviser went through some kind of a decision tree and told me that my best bet is to apply for benefits if I am eligible, saying that I just need to show them some letter without claiming the benefit. It is absurd. If wearing an ankle tag for a month to prove my address was an option, I'd go with that.
Last year, I stuffed every document I owned into a folder and went to a brick & mortar bank to open an account. No dice. The customer adviser went through some kind of a decision tree and told me that my best bet is to apply for benefits if I am eligible, saying that I just need to show them some letter without claiming the benefit. It is absurd. If wearing an ankle tag for a month to prove my address was an option, I'd go with that.
> but it is good to know that it takes a year merely to qualify for a score.
Technically it doesn't - banks leak your details to CRAs upon every major interaction (account application, etc) and regularly confirm them if they have a continued relationship with you (if you have an account open they'll typically report the status of the account every month).
However other banks may still be suspicious of a brand new record and might want to wait a few months before trusting it (since if the record was created fraudulently, it will usually get discovered and rectified pretty early - if the record is there for a long time, either it's legit or the fraudster has done an above-average job). The "one year" number is purely arbitrary but feels fair to me, that's probably what I'd do if I was building such a system (though I'd also build an escape hatch to allow people to confirm identity differently without CRA scum being involved).
Furthermore, in the UK there is no concept of "credit score". It's a myth perpetuated by the CRAs just so you obsess over that meaningless number that they can tweak every month to give you a reason to keep coming back and look at their "offers". In the UK, lenders get your raw report (aka identity, address history, recent credit applications and their status, open accounts, etc) and then make a decision internally based on their own algorithms.
Technically it doesn't - banks leak your details to CRAs upon every major interaction (account application, etc) and regularly confirm them if they have a continued relationship with you (if you have an account open they'll typically report the status of the account every month).
However other banks may still be suspicious of a brand new record and might want to wait a few months before trusting it (since if the record was created fraudulently, it will usually get discovered and rectified pretty early - if the record is there for a long time, either it's legit or the fraudster has done an above-average job). The "one year" number is purely arbitrary but feels fair to me, that's probably what I'd do if I was building such a system (though I'd also build an escape hatch to allow people to confirm identity differently without CRA scum being involved).
Furthermore, in the UK there is no concept of "credit score". It's a myth perpetuated by the CRAs just so you obsess over that meaningless number that they can tweak every month to give you a reason to keep coming back and look at their "offers". In the UK, lenders get your raw report (aka identity, address history, recent credit applications and their status, open accounts, etc) and then make a decision internally based on their own algorithms.
Have you tried Chase UK? They are an app-only bank but don't offer any lending so the checks should be more relaxed. They claim to accept an EU photo ID card if you have one of those.
If you want another option, check out TransferWise - they should be able to open you an account as well.
I wouldn't consider Revolut ethical though.
Revolut allowed people to open accounts immediately with no (or very soft) KYC but then had to limit (by law) the amount of money they could transact before passing stronger KYC. This led to a lot of people opening Revolut accounts, going abroad and ending up stranded with no access to their money once they've exhausted the initial limit, sometimes with no way to complete KYC at all if they didn't have the required documents on hand.
The ethical approach here would've been to prevent these people from opening accounts without initial full KYC or have strong & persistent warnings about the issue to dissuade people from going abroad with a limited account, but who cares about people being stranded if you can have "growth" instead?
Revolut allowed people to open accounts immediately with no (or very soft) KYC but then had to limit (by law) the amount of money they could transact before passing stronger KYC. This led to a lot of people opening Revolut accounts, going abroad and ending up stranded with no access to their money once they've exhausted the initial limit, sometimes with no way to complete KYC at all if they didn't have the required documents on hand.
The ethical approach here would've been to prevent these people from opening accounts without initial full KYC or have strong & persistent warnings about the issue to dissuade people from going abroad with a limited account, but who cares about people being stranded if you can have "growth" instead?
See my sibling comment for a counterargument. I do agree with the warnings though.
That's strange, I've used Revolut as my main account for years and never hit any limits. I suppose there's ATM withdrawal cap but I don't use cash much.
I gave up on Revolut after scandals about its CEO and financial shenanigans; and the many customer service nightmares.
In banking, boring is better
In banking, boring is better
I tried boring with TSB. Their botched IT migration which left with me with no access to money for a few days and seeing other customer full account details when I signed in online causes some to switch to Monzo. They’re not perfect, and their app is getting noticeable worse for the fundamentals as they add more money making features like loans and flex, but I’ve still had no major issues in years.
You want "boring" but modern, competent "boring" such as Starling. It's modern but otherwise boring code (a Java monolith if I remember correctly), a modern app and is backed by a profitable, sustainable business with no "growth & engagement" smell.
> In banking, boring is better
Exactly, you don't want to hand your money to a fancy organization that experiments with its PR and god knows what it does behind the scenes.
Never heard about the scandals though, do you have any links?
Exactly, you don't want to hand your money to a fancy organization that experiments with its PR and god knows what it does behind the scenes.
Never heard about the scandals though, do you have any links?
Just noticed the double entendre in 'we value your privacy'--your private data provides the $value.
The Revolut app is a hot mess though.
Monzo have kept theirs clean l, focus and and useful.
Monzo have kept theirs clean l, focus and and useful.
Monzo's initial UI used to be amazing. I find their V2 UI terrible, and of course the various "growth & engagement" shenanigans don't help - feels more like a bullshit social media app than a tool that's supposed to hold & manage my money.
Revolut still doesn’t have a UK banking license, so you’re not protected up to £85k like you are with a normal bank.
Sadly closed my Monzo account down recently after applying for a joint account with my partner and being denied with no explanation (both long term users, good credit etc). Apparently a common story. Opened a Starling account and got one straight away. It's a shame because the Monzo user interface is miles better.
Monzo froze my account for over a year with no explanation and only released my money after I reported them to the financial ombudsman. Switched to Starling and couldn't be happier with the decision. Monzo's customer support is a clown car, Starling's is fast, responsive and professional.
I have this same issue - really weird - I have a joint account already with someone on my Starling and can't start a second one, anyone know another alternative I could use for a joint account?
This mirrors my experience a couple of weeks back. Having come across many others with the same problem I almost wondered if it was a case of pretend to have a feature to gauge interest (I'm sure it wasn't - I hate those things!)
I also ended up using starling instead - perfect really.
While I like the Monzo travel bits when travelling I find bank accounts much of a muchness really for my basic needs so don't have any real loyalty.
I also ended up using starling instead - perfect really.
While I like the Monzo travel bits when travelling I find bank accounts much of a muchness really for my basic needs so don't have any real loyalty.
For what it's worth I've had a joint account for years. It works fine but there are some wrinkles - mainly that it's not a first class citizen. Split the bill and other Monzo specific features only work with your individual account.
Starling is no better, you were just lucky. I found Starling customer service appalling. Basically "go somewhere else if you don't like it".
I have a monzo personal and business account and I haven't had any major issues. As a former Barclays customer, they'd have to be fairly terrible to be any worse though.
I did try an open a Starling account once but they claimed my phone number was already linked to an existing account, which I found strange and wasn't prepared to jump through the hoops required to prove otherwise.
I did try an open a Starling account once but they claimed my phone number was already linked to an existing account, which I found strange and wasn't prepared to jump through the hoops required to prove otherwise.
Well it might be true. They just haven't realised that there are only so many phone numbers, and they change hands.
Earlier this year my partner and I switched our joint account from Monzo to Starling simply because we both hated using the Monzo app. Navigating the app feels unnatural to us and probably due to how infrequently we use it, we never learnt to live with it.
Last week I finally closed my personal Monzo account as I only used it for one small DD a month and much prefer the Starling and NatWest apps.
I have used Starling app and I couldn't make sense of statements. I think it's equally bad as Monzo.
Also I kind of despise the idea that you have to have an app to access the account.
After trying these "challenger" banks I am staying with my good old High Street bank where I can access my account from the web and it does not have any confusing bells and whistles.
Also I kind of despise the idea that you have to have an app to access the account.
After trying these "challenger" banks I am staying with my good old High Street bank where I can access my account from the web and it does not have any confusing bells and whistles.
I don’t know about Monzo but you can access your Starling account on the web.
You can access a monzo business account on the web to access statements and such. I believe they also have an emergency web access feature for personal accounts.
https://monzo.com/blog/2018/06/13/how-to-get-online-in-an-em...
https://monzo.com/blog/2018/06/13/how-to-get-online-in-an-em...
Monzo business account is very much useless as it isn't connected to SWIFT.
You need to have an app to sign up to Starling.
I made the same switch due to Monzo refusing me and my partner a joint account. Starling had no issue with giving us one
On a general note, referral rewards are not necessarily a good thing i.e. when you say "invite a friend and get $X". Turns out non-money rewards work better.
A quote from [1]:
> When money comes into play it switches us from ‘social mode’ to ‘business transaction mode’. We become more selfish, distant, less helpful, and less willing to be helped.
You don't even need research to back this, it seems obvious when you think about it.
[1] https://tips.ariyh.com/p/non-money-referrals
A quote from [1]:
> When money comes into play it switches us from ‘social mode’ to ‘business transaction mode’. We become more selfish, distant, less helpful, and less willing to be helped.
You don't even need research to back this, it seems obvious when you think about it.
[1] https://tips.ariyh.com/p/non-money-referrals
I downloaded Monzo on the Play store and installed it. During registration it asked for personal data like my address etc then proceeded to tell me it’s a UK only app. I was shocked. I’m in the EEA and thought I could use the app. It should be clear in the app’s description that it’s a UK only affair. I imagine this has happened to many more people other than me.
Kind of hard to determine if you're a UK tax resident without some details, no?
There’s no mention of it being a strictly UK affair in the app description. I imagine 100s of people download it each day, fill in the form and then bail once they realize it’s UK only.
I've just checked the description in the Play Store and it says 'Open a full UK bank account'. Maybe that is new, but it is pretty clear.
That doesn't mean that it's closed to non-residents.
Don't all UK banks require a UK address?
But that's not something you'd expect a non-resident to know. Making account opening criteria transparent wouldn't hurt anything and would save everyone time.
I wouldn't expect a non-resident to know without doing research. But I would expect them to do that research because opening a bank account in another country because it is not a standard thing to do. I don't think it's the job of an app store page to explain this.
You don't need to be a UK tax resident to have a Monzo account. I have UK citizenship, but am not a resident or tax resident
FYI, I'm pretty sure they actually do require you to be a resident, though a lot of people get away with not updating their address
https://monzo.com/help/legal-stuff/tax-residency-not-uk
https://monzo.com/help/legal-stuff/tax-residency-not-uk
It is not a simple app, it's a bank. Not sure how you expect to open a UK bank account not living in the UK...
Edit: I've just checked the description in the Play Store and it says 'Open a full UK bank account'. Maybe that is new, but it is pretty clear.
Edit: I've just checked the description in the Play Store and it says 'Open a full UK bank account'. Maybe that is new, but it is pretty clear.
Non-resident accounts exist (though they are generally more expensive), and several countries don't even require any proof of residence (i.e. you can open a bank account while on a tourist visa)
I know they exist, but they are not the norm. They even call them 'international bank accounts' in most cases (I think HSBC calls it that, or Barclays). Most common bank accounts will require proof of address in the respective country. I don't think it is expected to specify all that in the app description.
Given Monzo's hiring practices, I'm not sanguine about the future of this company.
I myself went through their interview process not long ago and to say it lived up to the sentiment of the glassdoor reviews is putting it mildly. Several rounds, silly armchair-psychologist behavioral questions, and the interviewers made it blatant that they didn't want to be there. Did my last interview at 4pm one day, got rejected by 8am next business day. I've gotten offers from Google, Amazon, etc so I know I interview well, not sure what happened there but really got the vibe that their employees are never quite sure if they're doing well, and management likes it that way.
They're a bank struggling to market themselves as a tech company.
I myself went through their interview process not long ago and to say it lived up to the sentiment of the glassdoor reviews is putting it mildly. Several rounds, silly armchair-psychologist behavioral questions, and the interviewers made it blatant that they didn't want to be there. Did my last interview at 4pm one day, got rejected by 8am next business day. I've gotten offers from Google, Amazon, etc so I know I interview well, not sure what happened there but really got the vibe that their employees are never quite sure if they're doing well, and management likes it that way.
They're a bank struggling to market themselves as a tech company.
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I’d you have offers from Google and Amazon then why are you interviewing at a place like Monzo? They can probably tell you’re both wasting your time so rejected you on that.
I turned down my offers from Google at Amazon because I value WLB and being able to continue with my freelance work and content creation. I figured working at a bank would be congruent with this sentiment.
You do cool work, btw. Just be careful, Shopify seems to be real layoff happy. I've even had some of your staff engineers hmu on Linkedin for a position and I've been having to say thanks but no thanks.
You do cool work, btw. Just be careful, Shopify seems to be real layoff happy. I've even had some of your staff engineers hmu on Linkedin for a position and I've been having to say thanks but no thanks.
Because Monzo will pay more than Google or Amazon in the UK.
This hasn't been the case in my experience interviewing at all of those three -- both Google and Amazon's comp for a similar role and level at Monzo were way higher.
Edit: to clarify, I didn't actually end up interviewing at Monzo because the recruiter said no pretty much right away on hearing my salary ask.
Edit: to clarify, I didn't actually end up interviewing at Monzo because the recruiter said no pretty much right away on hearing my salary ask.
I didn't think anyone paid more than Google?
Facebook pay better than Google in London from what I've heard.
So let me ask you. Is the only reason that you're at Shopify that you couldn't get an offer from Google or Amazon?
I did apply to Google before and didn't get an offer so yes I guess that is literally true.
Not the intended use case, but the monzo.me links are great for financial domination too.
As a cash slave, it makes it very easy to send to UK-based cash masters from outside the UK.
As a cash slave, it makes it very easy to send to UK-based cash masters from outside the UK.
How do they make money?
The short answer is that they don't really. UK retail banking is notoriously low margin, and all of the major banks struggle to make anything from their consumer businesses. Charging for bank accounts is not something the UK market accepts.
They'll likely cover costs in the long term, and their business banking will probably do fine, but I suspect the valuations aren't justified. The main way that the major players make money is through things like mortgages, wealth management for the very wealthy, and through their investment banking arms.
Starling is another startup bank, a main competitor to Monzo. While they're decidedly less "cool", they seem to have targeted business banking much more, and I suspect that's why they're now in a better position. Monzo went big on Monzo Plus and even on its ~3rd? iteration, it seems to have had a lacklustre reception. I'm Monzo user #13, about as onboard with the idea as I could be, and I find it unconvincing.
Monzo have just launched Monzo Flex, an easy payment system like AfterPay/ClearPay/Klarna. I'd normally expect that to do well but it's about 2 years too late and going into a recession is probably not the right time. Hopefully it'll do well as we come out.
They'll likely cover costs in the long term, and their business banking will probably do fine, but I suspect the valuations aren't justified. The main way that the major players make money is through things like mortgages, wealth management for the very wealthy, and through their investment banking arms.
Starling is another startup bank, a main competitor to Monzo. While they're decidedly less "cool", they seem to have targeted business banking much more, and I suspect that's why they're now in a better position. Monzo went big on Monzo Plus and even on its ~3rd? iteration, it seems to have had a lacklustre reception. I'm Monzo user #13, about as onboard with the idea as I could be, and I find it unconvincing.
Monzo have just launched Monzo Flex, an easy payment system like AfterPay/ClearPay/Klarna. I'd normally expect that to do well but it's about 2 years too late and going into a recession is probably not the right time. Hopefully it'll do well as we come out.
Do they lend? That’s where basically all of a bank’s profits come from, deposits are just there mostly as low-cost liquidity (and because creating deposits and the flows of inter-bank transfers are all part of enabling lending to happen).
So I’m always surprised that lending and credit isn’t the core strategy of these banks - there’s very little money to be made in fees…
So I’m always surprised that lending and credit isn’t the core strategy of these banks - there’s very little money to be made in fees…
They are very conservative with their lending. They do lend, but not much (relatively speaking), and in any case I'm not sure lending alone will satisfy their investor's expectations.
There's not even that much to be made in most lending (by transactions). Lending through overdrafts doesn't make a lot as it's typically lending to customers who are least able to afford it.
Mortgages and credit cards are the big ones, and Monzo does neither. However I would like to see a credit card from Monzo.
Mortgages and credit cards are the big ones, and Monzo does neither. However I would like to see a credit card from Monzo.
Monzo does have Buy Now Pay Later now, for whatever that's worth.
Starling makes money from business accounts (they pocket the interest on those, and that interest amounts to more considering business accounts keep a larger balance) and I believe also provides services to other payment companies, essentially SaaS-ing their tech.
It's a shame because this is something that Monzo could've done just as well and there's absolutely a place (well, was - that's now taken by Starling) in the market for it. Natwest still charges extra for a "next-gen" business account that allows multi-user access to a web UI, and I bet it's terrible - this is something a company can Monzo could've built in days based on their existing modern tech at a time where there was nothing like it in the market.
It's a shame because this is something that Monzo could've done just as well and there's absolutely a place (well, was - that's now taken by Starling) in the market for it. Natwest still charges extra for a "next-gen" business account that allows multi-user access to a web UI, and I bet it's terrible - this is something a company can Monzo could've built in days based on their existing modern tech at a time where there was nothing like it in the market.
Monzo do have good tech, but I've also heard that there is a "surprising amount of legacy tech" there as well. I'd interpret that as either they do too many re-writes of things, and/or they're perhaps not building at the level of quality that they should have been. They have some excellent engineers in the early team, but I've also seen a lot of very inexperienced people go there, so that in combination with a "move fast" mentality, will likely result in a lot of codebase issues and churn.
Starling seem to have taken a "slow and steady wins the race" sort of approach, and had a bunch of experienced engineers build a boring old Java app. Nothing special but I'm not surprised that it is working out ok in the long run.
Starling seem to have taken a "slow and steady wins the race" sort of approach, and had a bunch of experienced engineers build a boring old Java app. Nothing special but I'm not surprised that it is working out ok in the long run.
Monzo seems to have gone all-in on microservices (they have thousands apparently), which sounds like an absolute nightmare.
One of their earliest engineers was apparently a bit of a microservices guru, so there's a good chance that at least they did it well, in terms of mitigating the litany of common issues. Though I'm still skeptical as to whether it was actually a good idea.
Yes that is one of my concerns with their tech stack. The management overhead of that must be insane.
I've noticed that about Monzo. They were very early adopters of Kubernetes amongst other things, which surprised me as early Kubernetes was not exactly secure...
Having seen some presentations about their tech. stack, it seems very clever and has interesting ideas, but I was worried that once the people who designed it had moved on , how maintainable would it be (coming from a banking background where I found that systems lived on for EVAR)
Having seen some presentations about their tech. stack, it seems very clever and has interesting ideas, but I was worried that once the people who designed it had moved on , how maintainable would it be (coming from a banking background where I found that systems lived on for EVAR)
Monzo does have business accounts... I have one. It's great.
They have them now, long after Starling ate their lunch - my point was that they could've offered them before Starling and probably made a killing (it would've been the only option for a modern business bank account in the market back in those days).
I see plenty of people with blue Monzo+ cards.
I think since app dominated baking became a thing a lot more people are paying for premium accounts.
Imho they all offer poor value for money though
I think since app dominated baking became a thing a lot more people are paying for premium accounts.
Imho they all offer poor value for money though
That might be highly location specific as well - ie, clustered around wealthy urban areas such as London. In Wales I've never seen such a card (although, certainly more than a few coral cards around!) Probably quite easy to saturate that market.
> The short answer is that they don't really. UK retail banking is notoriously low margin, and all of the major banks struggle to make anything from their consumer businesses.
I do wonder why the VCs wanted into this market at all
intense competition snuffed out the margins of retail banking 30 years ago
and the "legacy" (read: profitable) banks are more that capable of putting together a shiny looking app
I do wonder why the VCs wanted into this market at all
intense competition snuffed out the margins of retail banking 30 years ago
and the "legacy" (read: profitable) banks are more that capable of putting together a shiny looking app
I find it hard to believe that they struggle to make money off bank accounts. It's an intentional top of funnel strategy to offer free accounts.
> I find it hard to believe that they struggle to make money off bank accounts.
Why is that? Current accounts are a loss-leader for most (all?) legacy banks too, they're used to lure the customer in so they can then pitch revenue-generating products such as credit cards or mortgages.
Why is that? Current accounts are a loss-leader for most (all?) legacy banks too, they're used to lure the customer in so they can then pitch revenue-generating products such as credit cards or mortgages.
Go look up how much money they have in deposits. When I checked in 2017/18 they had like 87mm USD total. That’s a single UHNW account at a “real” bank. Maybe it would earn 1-2mm in annual profits from AUM to cover a dozen staff? Idk I’m not an expert.
£4.4 billion in Feb, so about 6bn USD. https://www.statista.com/statistics/1118161/customer-loans-a...
UK banks work to an expectation of 0-3% margin. In Monzo's favour is that they don't have to operate a branch network, but then again they are small compared to the high street banks. There's just not a lot of money available in accounts, even accounting for using it for lending etc. Also bear in mind that while they can use deposits to fund some amount of lending, the amount they have to keep on hand, collateral, insurance (not sure if it's called that) with the Bank of England, etc, are all very heavily regulated so that they can't mess it up, which conversely means it's much harder to monetise than expected based on a basic understanding of fractional reserve banking.
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- Interchange fees (Monzo take ~1% of every card transaction)
- Packaged account fees (Monzo Plus, Premium and business Pro)
- Lending (Overdrafts, Personal Loans, Credit Card)
- Interest on bank deposits
- Packaged account fees (Monzo Plus, Premium and business Pro)
- Lending (Overdrafts, Personal Loans, Credit Card)
- Interest on bank deposits
they also charge you to take your own money out and put your own money in(!!!)
Cash withdrawal in pounds in the UK: First £250 in a rolling 30-day period free, 3% after that
Cash deposit: £1 per deposit to pay in cash at any PayPoint
I was surprised by this and it turns out its a bit of a misrepresentation as you get unlimited fee free withdrawals if you meet one of these criteria which, in the UK, pretty much anyone except a teenager with no job will meet:
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.
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.
it's not misleading, it's true
if you lose your job, you're now being charged 3% to pull your own money out
(and regardless: they still charge you to deposit your own money, unheard of for retail customers)
if you lose your job, you're now being charged 3% to pull your own money out
(and regardless: they still charge you to deposit your own money, unheard of for retail customers)
The criteria seem to be mostly designed to ensure that people who aren't using it as their main account can't do things that cost Monzo lots of money. That said, if you want to deal mostly with cash then Monzo probably isn't for you, and I think they're ok with that.
What the heck?
Interest on loaning your current account balance out.
Is it odd that the author, along with the rest of the founders, came from Starling Bank[1], a UK digital bank founded in 2014, and yet Starling Bank isn't mentioned?
Slightly less obvious, but still important, is the UK's first internet bank, Egg, was founded in 1998! [2]
[1] https://en.wikipedia.org/wiki/Monzo [2] https://en.wikipedia.org/wiki/Egg_Banking