What is Monzo and how safe is it?
Monzo is a challenger bank which allows customers to manage their money through a phone app.
What is Monzo Bank?
Monzo Bank was first introduced in 2015 under the name Mondo. It was one of the fastest growing crowd-funded campaigns in history, managing to raise one million dollars in a matter of minutes. As an app-based mobile bank, Monzo is a smart banking solution.
It provides you with a Mastercard debit card and functions exactly as a normal current account does, with the key difference being that it’s all digitally run.
It now offers current accounts, loans, savings accounts and investments – which can all be opened through the app.
How does Monzo work?
Monzo works much like a regular current account – you’ll be able to set up standing orders and make withdrawals and deposits, but the difference is you can manage your account without needing to visit a branch.
While there are no branches, you can deposit money at a Paypoint or transfer money over from another bank account.
It also has several free money management tools for customers, helping them to understand and organise their finances.
Is Monzo a registered bank?
Monzo has a UK banking licence and it is registered by the Prudential Regulation Authority and regulated by the Financial Conduct Authority (FCA). This also means that up to £85,000 kept within a Monzo account is protected under the Financial Services Compensation Scheme (FSCS).
What features are there?
There are a number of features you can benefit from if you sign up with Monzo bank including:
Live, real-time updates when making purchases with your Monzo card via the app, letting you keep track of your balance
You can move money into specific ‘pots’ for savings or bills, and set up direct debits for these
Earn cashback at certain retailers
Overdrafts
Joint accounts
The app provides user-friendly graphics to help you understand your spending and saving habits
Pay anyone instantly through your app – and they don’t need a Monzo account. You can also keep track of who owes you money, and split bills
Round each transaction you make up to the nearest pound and add the remainder to a savings pot
Monzo can pinpoint certain transactions you make on a map made available through the app
You can opt to receive notifications if your bills are higher or lower than usual
The app allows you to add notes and receipts to your transactions
Perks for travel
You’ll be able to forego fees and charges when using a Monzo card abroad. This includes regular purchases at retailers and when paying with your Monzo card.
Monzo provides free ATM cash withdrawals abroad, but it does have a £200 ATM withdrawal limit in place — anything above that over a 30-day period will be charged at 3%. There’s no limit on debit card purchases.
The Mastercard exchange rate applies so it’s a good idea to keep track of the foreign exchange rate when you plan your travels.
How do you apply?
The app is available on iOS and Android. Once you download the Monzo app you can then sign up.
This will require a form of identification – your passport or driver’s licence, for example. Once you’ve completed the application, you’ll receive your debit card in the post.
Can you withdraw money from Monzo?
Yes, you will be able to withdraw money from Monzo, much like you would with a regular debit or credit card. There is no cap on free ATM withdrawals within the UK.
Do you have to pay for Monzo?
There’re no fees involved in the sign up or use of Monzo within the UK, including free ATM withdrawals, for the basic account. This is also true for overseas use but if you withdraw more than £200 abroad, you’ll be charged 3% for withdrawals made moving forward.
However, it does also have a range of paid-for accounts to choose from. They include the following:
Monzo Extra Account (£3 per month)
Monzo Perks Account (£7 per month)
Monzo Max Account (£17 per month)
Monzo Max Family Account (£22 per month)
How to contact Monzo
Email: help@monzo.com
UK telephone number: 0800 802 1281
Calling from abroad: +44 20 3872 0620
Compare current accounts with MoneySuperMarket
You can compare the best current accounts with the MoneySuperMarket online tool. You’ll be able to filter your choices by any rewards and perks you may be able to benefit from as well as switch incentives and any overdraft charges and interest rates that come into play. We make comparing easy to make sure you have access to the best deals on offer.
Once you’ve decided to switch your current account, simply click through to the provider where you’ll be able to sign up to your new account.
