Breaking the habit

You make monzo, monzo

Banking has been going through some significant changes in the past few years, with a number of ‘challenger’ banks emerging with a focus on convenience and technology.

After starting out as a financial service called Mondo that allowed customers to load money onto a pre-paid debit-card and use an app to monitor their financial transactions, Monzo is now a fully-fledged bank with a license regulated by the Financial Conduct Authority (FCA) to operate in the UK. It’s also backed by the Financial Services Compensation Scheme (FSCA) which protects up to £85,000 of your money if the bank should encounter any problems.

This means Monzo can offer customers current, joint, teen, business and savings accounts, ISAs, loans and overdrafts, plus a number of innovative services all with the assurance that your finances are safe.

How does Monzo work?
As one of the new smart-banks, Monzo dispenses with physical branches and instead has a focus on its smartphone app and online customer service. This means you can discuss issues regarding your account 24/7 via its instant messaging system.

While the app remains the hub of the Monzo experience, accounts also come with a debit card to use in the physical world. This is backed by Mastercard, so you can use it almost anywhere around the globe for contactless payments or to withdraw cash from ATMs. The app itself is available for Android and iOS and features an attractive design, with images and graphics livening up the boring old spreadsheet approach that banks have used for years. Instant notifications let you know when money has been paid into or out of your account, making it easy to keep track of your activities, and all transactions or

The interface includes sections for payments you’ve made and any scheduled to come out, plus you can use the Roundup feature to take all of those pennies left over in transactions and put them in your savings account. So, if you make a payment of £12.63 then £0.37 will makes its way to your piggy bank without you having to do anything at all.

You can also set specific savings targets, or Pots as Monzo calls them, complete with a picture so you can recognise them at a glance. These can be added to by the Roundup feature, with a monthly automated payment or simply whenever you want to pop a few quid in the jar. At the time of writing these also offered interest rates of up to 1.50% (AER, fixed) so your savings gets a little bonus.

One interesting feature in the Current account is being able to get your wages a day early. This works if you have them paid directly into your account via BACS. At 4pm on the day before its due to arrive in your account Monzo can free up the money and make it available to you. No fees, just your wages and the chance to spend them.

But what exactly does the future look like at Monzo?